Document:

Exhibit 4.3

 

NEITHER THE ISSUANCE AND
SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE HAVE BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED
FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL, IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT
REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING, THE
SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES.

 

Lilis
Energy, Inc.

 

Warrant
To Purchase Common Stock

 

Number of Shares of Common Stock: 1,000,000

Date of Issuance: September 2, 2014 ("Issuance
Date")

 

Lilis Energy, Inc., a Nevada
corporation, (the "Company"), hereby certifies that, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, Bristol Capital, LLC, the registered holder hereof or its permitted assigns (the "Holder"),
is entitled, subject to the terms set forth below and pursuant to a Consulting Agreement between the Company and Consultant entered
into on September 2, 2014 (the “Consulting Agreement”), to purchase from the Company, at the Exercise Price (as defined
below) then in effect, upon surrender of this Warrant to Purchase Common Stock (including any Warrants to Purchase Common Stock
issued in exchange, transfer or replacement hereof, the "Warrant"), at any time or times on or after the date
hereof, but not after 11:59 p.m., New York Time, on the Expiration Date (as defined below), One Million (1,000,000) fully paid
nonassessable shares of Common Stock (as defined below) (the "Warrant Shares"). Except as otherwise defined
herein, capitalized terms in this Warrant shall have the meanings set forth in Section 16. In the event of any conflict between
the terms of this Warrant and the Consulting Agreement, the terms of the Consulting Agreement shall govern.

 

    	 

    	 

    

 

1.EXERCISE OF WARRANT.

 

(a)Mechanics of
Exercise. Subject to the terms and conditions hereof (including, without limitation, the limitations set forth in Section 1(f)),
this Warrant may be exercised by the Holder on any day on or after the date hereof in whole or in part, by (i) delivery of
a written notice, in the form attached hereto as Exhibit A (the "Exercise Notice"), via electronic mail
to an e-mail address provided by the Company, of the Holder's election to exercise this Warrant and (ii) payment to the Company
of an amount equal to the applicable Exercise Price multiplied by the number of Warrant Shares as to which this Warrant is being
exercised (the "Aggregate Exercise Price") in cash or by wire transfer of immediately available funds or (B) by
notifying the Company that this Warrant is being exercised pursuant to a Cashless Exercise (as defined in Section 1(f)). The Holder
shall not be required to deliver the original Warrant in order to effect an exercise hereunder. Execution and delivery of the Exercise
Notice with respect to less than all of the Warrant Shares shall have the same effect as cancellation of the original Warrant and
issuance of a new Warrant evidencing the right to purchase the remaining number of Warrant Shares. On or before the third Business
Day following the date on which the Company has received each of the Exercise Notice and the Aggregate Exercise Price (or notice
of a Cashless Exercise) (the "Exercise Delivery Documents"), the Company shall transmit by facsimile or electronic
mail to an e-mail address provided by an authorized representative of the Holder an acknowledgment of confirmation of receipt of
the Exercise Delivery Documents to the Holder and the Company's transfer agent (the "Transfer Agent"). On or before
the third Trading Day following the date on which the Company has received all of the Exercise Delivery Documents (the "Share
Delivery Date"), the Company shall (X) provided that the Transfer Agent is participating in The Depository Trust Company
("DTC") Fast Automated Securities Transfer Program, upon the request of the Holder, credit such aggregate number
of shares of Common Stock to which the Holder is entitled pursuant to such exercise to the Holder's or its designee's balance account
with DTC through its Deposit Withdrawal Agent Commission system, or (Y) if the Transfer Agent is not participating in the DTC Fast
Automated Securities Transfer Program, issue and dispatch by overnight courier to the address as specified in the Exercise Notice,
a certificate, registered in the Company's share register in the name of the Holder or its designee, for the number of shares of
Common Stock to which the Holder is entitled pursuant to such exercise. Upon delivery of the Exercise Delivery Documents, the Holder
shall be deemed for all corporate purposes to have become the holder of record of the Warrant Shares with respect to which this
Warrant has been exercised, irrespective of the date such Warrant Shares are credited to the Holder's DTC account or the date of
delivery of the certificates evidencing such Warrant Shares, as the case may be. If this Warrant is submitted in connection with
any exercise pursuant to this Section 1(a) and the number of Warrant Shares represented by this Warrant submitted for exercise
is greater than the number of Warrant Shares being acquired upon an exercise, then the Company shall as soon as practicable and
in no event later than three Business Days after any exercise and at its own expense, issue a new Warrant (in accordance with Section
7(d)) representing the right to purchase the number of Warrant Shares purchasable immediately prior to such exercise under this
Warrant, less the number of Warrant Shares with respect to which this Warrant is exercised. No fractional shares of Common Stock
are to be issued upon the exercise of this Warrant, but rather the number of shares of Common Stock to be issued shall be rounded
up to the nearest whole number. The Company shall pay any and all taxes which may be payable with respect to the issuance and delivery
of Warrant Shares upon exercise of this Warrant.

 

(b)Exercise Price.
For purposes of this Warrant, “Exercise Price” means $2.00, subject to adjustment as provided herein.

 

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(c)Company's Failure
to Timely Deliver Securities. If the Company shall fail for any reason or for no reason to issue to the Holder within three
(3) Trading Days of receipt of the Exercise Delivery Documents, a certificate for the number of shares of Common Stock to which
the Holder is entitled and register such shares of Common Stock on the Company's share register or to credit the Holder's balance
account with DTC for such number of shares of Common Stock to which the Holder is entitled upon the Holder's exercise of this Warrant,
and if on or after such Trading Day the Holder purchases (in an open market transaction or otherwise) shares of Common Stock to
deliver in satisfaction of a sale by the Holder of shares of Common Stock issuable upon such exercise that the Holder anticipated
receiving from the Company (a "Buy-In"), then, in addition to all other remedies available to the Holder, the
Company shall, within three Business Days after the Holder's request and in the Holder's discretion, either (i) pay cash to the
Holder in an amount equal to the Holder's total purchase price (including brokerage commissions, if any) for the shares of Common
Stock so purchased (the "Buy-In Price"), at which point the Company's obligation to deliver such certificate (and
to issue such shares of Common Stock) or credit such Holder's balance account with DTC shall terminate, or (ii) promptly honor
its obligation to deliver to the Holder a certificate or certificates representing such shares of Common Stock or credit such Holder's
balance account with DTC and pay cash to the Holder in an amount equal to the excess (if any) of the Buy-In Price over the product
of (A) such number of shares of Common Stock, times (B) the Closing Bid Price on the date of exercise.

 

(d)Cashless Exercise.
 Notwithstanding anything contained herein to the contrary, if a Registration Statement covering the resale of the Warrant
Shares that are the subject of the Exercise Notice (the "Unavailable Warrant Shares") is not available or has
not been demanded for the resale of such Unavailable Warrant Shares, the Holder may, in its sole discretion, exercise this Warrant
in whole or in part and, in lieu of making the cash payment otherwise contemplated to be made to the Company upon such exercise
in payment of the Aggregate Exercise Price, elect instead to receive upon such exercise the "Net Number" of shares of
Common Stock determined according to the following formula (a "Cashless Exercise"):

 

	 	Net Number = (A x B) - (A x C)	 
	 	B		 
	 	 	 	 
	 	For purposes of the foregoing formula:	 

 

A= the total number of shares
with respect to which this Warrant is then being exercised.

 

B= the Closing Sale Price of the shares of Common
Stock (as reported by Bloomberg) on the date immediately preceding the date of the Exercise Notice.

 

C= the Exercise Price then
in effect for the applicable Warrant Shares at the time of such exercise.

 

(e)Disputes.
In the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the Warrant Shares, the
Company shall promptly issue to the Holder the number of Warrant Shares that are not disputed and resolve such dispute in accordance
with Section 12.

 

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(f)Limitation
on Exercises. The Company shall not effect the exercise of this Warrant, and the Holder shall not have the right to exercise
this Warrant, to the extent that after giving effect to such exercise, such Person (together with such Person's affiliates) would
beneficially own in excess of 4.99% (the "Maximum Percentage") of the shares of Common Stock outstanding immediately
after giving effect to such exercise; provided that the Holder may waive the limitations set forth herein to increase its beneficial
ownership to 9.9% with sixty-one (61) days written notice to the Company. For purposes of the foregoing sentence, the aggregate
number of shares of Common Stock beneficially owned by such Person and its affiliates shall include the number of shares of Common
Stock issuable upon exercise of this Warrant with respect to which the determination of such sentence is being made, but shall
exclude shares of Common Stock which would be issuable upon (A) exercise of the remaining, unexercised portion of this Warrant
beneficially owned by such Person and its affiliates and (B) exercise or conversion of the unexercised or unconverted portion of
any other securities of the Company beneficially owned by such Person and its affiliates (including, without limitation, any convertible
notes or convertible preferred stock or warrants) subject to a limitation on conversion or exercise analogous to the limitation
contained herein. Except as set forth in the preceding sentence, for purposes of this paragraph, beneficial ownership shall be
calculated in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act").
For purposes of this Warrant, in determining the number of outstanding shares of Common Stock, the Holder may rely on the number
of outstanding shares of Common Stock as reflected in (1) the Company's most recent Form 10-K, Form 10-Q, Current Report on Form
8-K or other public filing with the Securities and Exchange Commission, as the case may be, (2) a more recent public announcement
by the Company or (3) any other notice by the Company or the Transfer Agent setting forth the number of shares of Common Stock
outstanding. For any reason at any time, upon the written or oral request of the Holder, the Company shall within one (1) Business
Day confirm orally and in writing to the Holder the number of shares of Common Stock then outstanding. In any case, the number
of outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of securities of the
Company by the Holder and its affiliates since the date as of which such number of outstanding shares of Common Stock was reported.
The provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with the terms
of this Section1(f) to correct this paragraph (or any portion hereof) which may be defective or inconsistent with the intended
beneficial ownership limitation herein contained or to make changes or supplements necessary or desirable to properly give effect
to such limitation.

 

(g)Insufficient
Authorized Shares. If at any time while this Warrant remain outstanding the Company does not have a sufficient number of authorized
and unreserved shares of Common Stock to satisfy its obligation to reserve for issuance upon exercise of this Warrant at least
a number of shares of Common Stock equal to 130% (the "Required Reserve Amount") of the number of shares of Common
Stock as shall from time to time be necessary to effect the exercise of all of this Warrant then outstanding (an "Authorized
Share Failure"), then the Company shall immediately take all action necessary to increase the Company's authorized shares
of Common Stock to an amount sufficient to allow the Company to reserve the Required Reserve Amount for this Warrant then outstanding.
Without limiting the generality of the foregoing sentence, as soon as practicable after the date of the occurrence of an Authorized
Share Failure, but in no event later than sixty (60) days after the occurrence of such Authorized Share Failure, the Company shall
hold a meeting of its stockholders for the approval of an increase in the number of authorized shares of Common Stock. In connection
with such meeting, the Company shall provide each stockholder with a proxy statement and shall use its best efforts to solicit
its stockholders' approval of such increase in authorized shares of Common Stock and to cause its board of directors to recommend
to the stockholders that they approve such proposal.

 

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2.ADJUSTMENT OF
EXERCISE PRICE AND NUMBER OF WARRANT SHARES. The Exercise Price and the number of Warrant Shares shall be adjusted from time
to time as follows:

 

(a)Adjustment upon
Issuance of shares of Common Stock. If and whenever on or after the Issuance Date, while this Warrant is outstanding, the Company
issues or sells, or in accordance with this Section 2 is deemed to have issued or sold, to any third party providing consulting
services to the Company (other than Consultant or its affiliates), any shares of Common Stock for a consideration per share (the
"New Issuance Price") less than the Exercise Price (the "Applicable Price") in effect immediately
prior to such issue or sale or deemed issuance or sale (the foregoing a "Dilutive Issuance"), then immediately
after such Dilutive Issuance, the Exercise Price then in effect shall be reduced to an amount equal to the New Issuance Price.
For purposes of determining the adjusted Exercise Price under this Section 2(a), the following shall be applicable:

 

(i)Issuance
of Options. If the Company in any manner grants any Options and the lowest price per share for which one share of Common Stock
is issuable upon the exercise of any such Option or upon conversion, exercise or exchange of any Convertible Securities issuable
upon exercise of any such Option is less than the Applicable Price, then such share of Common Stock shall be deemed to be outstanding
and to have been issued and sold by the Company at the time of the granting or sale of such Option for such price per share. For
purposes of this Section 2(a)(i), the "lowest price per share for which one share of Common Stock is issuable upon exercise
of such Options or upon conversion, exercise or exchange of such Convertible Securities issuable upon exercise of any such Option"
shall be equal to the sum of the lowest amounts of consideration (if any) received or receivable by the Company with respect to
any one share of Common Stock upon the granting or sale of the Option, upon exercise of the Option and upon conversion, exercise
or exchange of any Convertible Security issuable upon exercise of such Option. No further adjustment of the Exercise Price shall
be made upon the actual issuance of such shares of Common Stock or of such Convertible Securities upon the exercise of such Options
or upon the actual issuance of such shares of Common Stock upon conversion, exercise or exchange of such Convertible Securities.

 

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(ii)Issuance
of Convertible Securities. If the Company in any manner issues or sells any Convertible Securities and the lowest price per
share for which one share of Common Stock is issuable upon the conversion, exercise or exchange thereof is less than the Applicable
Price, then such share of Common Stock shall be deemed to be outstanding and to have been issued and sold by the Company at the
time of the issuance or sale of such Convertible Securities for such price per share. For the purposes of this Section 2(a)(ii),
the "lowest price per share for which one share of Common Stock is issuable upon the conversion, exercise or exchange thereof"
shall be equal to the sum of the lowest amounts of consideration (if any) received or receivable by the Company with respect to
one share of Common Stock upon the issuance or sale of the Convertible Security and upon conversion, exercise or exchange of such
Convertible Security. No further adjustment of the Exercise Price shall be made upon the actual issuance of such shares of Common
Stock upon conversion, exercise or exchange of such Convertible Securities, and if any such issue or sale of such Convertible Securities
is made upon exercise of any Options for which adjustment of this Warrant has been or is to be made pursuant to other provisions
of this Section 2(a), no further adjustment of the Exercise Price shall be made by reason of such issue or sale.

 

(iii)Change
in Option Price or Rate of Conversion. If the purchase price provided for in any Options, the additional consideration, if
any, payable upon the issue, conversion, exercise or exchange of any Convertible Securities, or the rate at which any Convertible
Securities are convertible into or exercisable or exchangeable for shares of Common Stock increases or decreases at any time, the
Exercise Price in effect at the time of such increase or decrease shall be adjusted to the Exercise Price which would have been
in effect at such time had such Options or Convertible Securities provided for such increased or decreased purchase price, additional
consideration or increased or decreased conversion rate, as the case may be, at the time initially granted, issued or sold. For
purposes of this Section 2(a)(iii), if the terms of any Option or Convertible Security that was outstanding as of the date of issuance
of this Warrant are increased or decreased in the manner described in the immediately preceding sentence, then such Option or Convertible
Security and the shares of Common Stock deemed issuable upon exercise, conversion or exchange thereof shall be deemed to have been
issued as of the date of such increase or decrease. No adjustment pursuant to this Section 2(a)(iii) shall be made if such adjustment
would result in an increase of the Exercise Price then in effect.

 

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(iv)Calculation
of Consideration Received. In case any Option is issued in connection with the issue or sale of other securities of the Company,
together comprising one integrated transaction in which no specific consideration is allocated to such Options by the parties thereto,
the Option Value will be calculated as set forth in Section 1(b). If any shares of Common Stock, Options or Convertible Securities
are issued or sold or deemed to have been issued or sold for cash, the consideration received therefor will be deemed to be the
net amount received by the Company therefor. If any shares of Common Stock, Options or Convertible Securities are issued or sold
for a consideration other than cash, the amount of such consideration received by the Company will be the fair value of such consideration,
except where such consideration consists of publicly traded securities, in which case the amount of consideration received by the
Company will be the Closing Sale Price of such security on the date of receipt. If any shares of Common Stock, Options or Convertible
Securities are issued to the owners of the non-surviving entity in connection with any merger in which the Company is the surviving
entity, the amount of consideration therefor will be deemed to be the fair value of such portion of the net assets and business
of the non-surviving entity as is attributable to such shares of Common Stock, Options or Convertible Securities, as the case may
be. The fair value of any consideration other than cash or publicly traded securities will be determined jointly by the Company
and the Holder. If such parties are unable to reach agreement within ten (10) days after the occurrence of an event requiring valuation
(the "Valuation Event"), the fair value of such consideration will be determined within five (5) Business Days
after the tenth day following the Valuation Event by an independent, reputable appraiser jointly selected by the Company and the
Holder. The determination of such appraiser shall be final and binding upon all parties absent manifest error and the fees and
expenses of such appraiser shall be borne by the Company.

 

(v)Record
Date. If the Company takes a record of the holders of shares of Common Stock for the purpose of entitling them (A) to
receive a dividend or other distribution payable in shares of Common Stock, Options or in Convertible Securities or (B) to
subscribe for or purchase shares of Common Stock, Options or Convertible Securities, then such record date will be deemed to be
the date of the issue or sale of the shares of Common Stock deemed to have been issued or sold upon the declaration of such dividend
or the making of such other distribution or the date of the granting of such right of subscription or purchase, as the case may
be.

 

(b)Adjustment upon
Subdivision or Combination of shares of Common Stock. If the Company at any time on or after the Issuance Date subdivides (by
any stock split, stock dividend, recapitalization or otherwise) one or more classes of its outstanding shares of Common Stock into
a greater number of shares, the Exercise Price in effect immediately prior to such subdivision will be proportionately reduced
and the number of Warrant Shares will be proportionately increased. If the Company at any time on or after the Issuance Date combines
(by combination, reverse stock split or otherwise) one or more classes of its outstanding shares of Common Stock into a smaller
number of shares, the Exercise Price in effect immediately prior to such combination will be proportionately increased and the
number of Warrant Shares will be proportionately decreased. Any adjustment under this Section 2(b) shall become effective at the
close of business on the date the subdivision or combination becomes effective.

 

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(c)Voluntary Adjustment By Company.
The Company may at any time during the term of this Warrant reduce the then current  Exercise Price to
any amount and for any period of time deemed appropriate by the Board of Directors of the Company. 

 

(d)Other Events.
If any event occurs of the type contemplated by the provisions of this Section 2 but not expressly provided for by such provisions,
then the Company's Board of Directors will make an appropriate adjustment in the Exercise Price and the number of Warrant Shares
so as to protect the rights of the Holder; provided that no such adjustment pursuant to this Section 2(d) will increase the Exercise
Price or decrease the number of Warrant Shares as otherwise determined pursuant to this Section 2.

 

3.RIGHTS UPON DISTRIBUTION
OF ASSETS. If the Company shall declare or make any dividend or other distribution of its assets (or rights to acquire its
assets) to holders of shares of Common Stock, by way of return of capital or otherwise (including, without limitation, any distribution
of cash, stock or other securities, property or options by way of a dividend, spin off, reclassification, corporate rearrangement,
scheme of arrangement or other similar transaction) (a "Distribution"), at any time after the issuance of this
Warrant, then, in each such case:

 

(a)any Exercise Price
in effect immediately prior to the close of business on the record date fixed for the determination of holders of shares of Common
Stock entitled to receive the Distribution shall be reduced, effective as of the close of business on such record date, to a price
determined by multiplying such Exercise Price by a fraction of which (i) the numerator shall be the Closing Bid Price of the shares
of Common Stock on the Trading Day immediately preceding such record date minus the value of the Distribution (as determined in
good faith by the Company's Board of Directors) applicable to one share of Common Stock, and (ii) the denominator shall be the
Closing Bid Price of the shares of Common Stock on the Trading Day immediately preceding such record date; and

 

(b)the number of Warrant
Shares shall be increased to a number of shares equal to the number of shares of Common Stock obtainable immediately prior to the
close of business on the record date fixed for the determination of holders of shares of Common Stock entitled to receive the Distribution
multiplied by the reciprocal of the fraction set forth in the immediately preceding paragraph (a); provided that in the event that
the Distribution is of shares of common stock ("Other Shares of Common Stock") of a company whose common shares
are traded on a national securities exchange or a national automated quotation system, then the Holder may elect to receive a warrant
to purchase Other Shares of Common Stock in lieu of an increase in the number of Warrant Shares, the terms of which shall be identical
to those of this Warrant, except that such warrant shall be exercisable into the number of shares of Other Shares of Common Stock
that would have been payable to the Holder pursuant to the Distribution had the Holder exercised this Warrant immediately prior
to such record date and with an aggregate exercise price equal to the product of the amount by which the exercise price of this
Warrant was decreased with respect to the Distribution pursuant to the terms of the immediately preceding paragraph (a) and the
number of Warrant Shares calculated in accordance with the first part of this paragraph (b).

 

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4.PURCHASE RIGHTS;
FUNDAMENTAL TRANSACTIONS.

 

(a)Purchase Rights.
In addition to any adjustments pursuant to Section 2 above, if at any time the Company grants, issues or sells any Options, Convertible
Securities or rights to purchase stock, warrants, securities or other property pro rata to the record holders of any class of shares
of Common Stock (the "Purchase Rights"), then the Holder will be entitled to acquire, upon the terms applicable
to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired if the Holder had held the number of
shares of Common Stock acquirable upon complete exercise of this Warrant (without regard to any limitations on the exercise of
this Warrant) immediately before the date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or,
if no such record is taken, the date as of which the record holders of shares of Common Stock are to be determined for the grant,
issue or sale of such Purchase Rights.

 

(b)Fundamental Transactions.
The Company shall not enter into or be party to a Fundamental Transaction (other than with respect to a Change of Control with
a Public Successor or with respect to a Change of Control with a Public Successor where the sole consideration in such Change of
Control transaction is cash (each, an "Excluded Change of Control Transaction")) unless the Successor Entity assumes
in writing all of the obligations of the Company under this Warrant and the other Transaction Documents in accordance with the
provisions of this Section 4(b) pursuant to written agreements in form and substance satisfactory to the Holder and approved by
the Holder prior to such Fundamental Transaction, including agreements to deliver to each holder of Warrants in exchange for such
Warrants a security of the Successor Entity evidenced by a written instrument substantially similar in form and substance to this
Warrant, including, without limitation, an adjusted exercise price equal to the value for the shares of Common Stock reflected
by the terms of such Fundamental Transaction, and exercisable for a corresponding number of shares of capital stock equivalent
to the shares of Common Stock acquirable and receivable upon exercise of this Warrant (without regard to any limitations on the
exercise of this Warrant) prior to such Fundamental Transaction, and satisfactory to the Holder. Upon the occurrence of any Fundamental
Transaction (other than an Excluded Change of Control Transaction), the Successor Entity shall succeed to, and be substituted for
(so that from and after the date of such Fundamental Transaction, the provisions of this Warrant referring to the "Company"
shall refer instead to the Successor Entity), and may exercise every right and power of the Company and shall assume all of the
obligations of the Company under this Warrant with the same effect as if such Successor Entity had been named as the Company herein.
Upon consummation of the Fundamental Transaction (other than an Excluded Change of Control Transaction), the Successor Entity shall
deliver to the Holder confirmation that there shall be issued upon exercise of this Warrant at any time after the consummation
of the Fundamental Transaction, in lieu of the shares of the Common Stock (or other securities, cash, assets or other property)
purchasable upon the exercise of the Warrant prior to such Fundamental Transaction, such shares of the publicly traded Common Stock
(or its equivalent) of the Successor Entity (including its Parent Entity) which the Holder would have been entitled to receive
upon the happening of such Fundamental Transaction had this Warrant been converted immediately prior to such Fundamental Transaction,
as adjusted in accordance with the provisions of this Warrant. In addition to and not in substitution for any other rights hereunder,
prior to the consummation of any Fundamental Transaction pursuant to which holders of shares of Common Stock are entitled to receive
securities or other assets with respect to or in exchange for shares of Common Stock (a "Corporate Event"), the
Company shall make appropriate provision to insure that the Holder will thereafter have the right to receive upon an exercise of
this Warrant at any time after the consummation of the Fundamental Transaction but prior to the ninetieth (90th) day after the
consummation of the Fundamental Transaction, in lieu of the shares of the Common Stock (or other securities, cash, assets or other
property) purchasable upon the exercise of the Warrant prior to such Fundamental Transaction, such shares of stock, securities,
cash, assets or any other property whatsoever (including warrants or other purchase or subscription rights) which the Holder would
have been entitled to receive upon the happening of such Fundamental Transaction had the Warrant been exercised immediately prior
to such Fundamental Transaction. Provision made pursuant to the preceding sentence shall be in a form and substance reasonably
satisfactory to the Holder. The provisions of this Section shall apply similarly and equally to successive Fundamental Transactions
and Corporate Events and shall be applied without regard to any limitations on the exercise of this Warrant.

 

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5.WARRANT HOLDER NOT
DEEMED A STOCKHOLDER. Except as otherwise specifically provided herein, the Holder, solely in such Person's capacity as a holder
of this Warrant, shall not be entitled to vote or receive dividends or be deemed the holder of share capital of the Company for
any purpose, nor shall anything contained in this Warrant be construed to confer upon the Holder, solely in such Person's capacity
as the Holder of this Warrant, any of the rights of a shareholder of the Company or any right to vote, give or withhold consent
to any corporate action (whether any reorganization, issue of stock, reclassification of stock, consolidation, merger, conveyance
or otherwise), receive notice of meetings, receive dividends or subscription rights, or otherwise, prior to the issuance to the
Holder of the Warrant Shares which such Person is then entitled to receive upon the due exercise of this Warrant. In addition,
nothing contained in this Warrant shall be construed as imposing any liabilities on the Holder to purchase any securities (upon
exercise of this Warrant or otherwise) or as a shareholder of the Company, whether such liabilities are asserted by the Company
or by creditors of the Company. Notwithstanding this Section 5, the Company shall provide the Holder with copies of the same notices
and other information given to the shareholders of the Company generally, contemporaneously with the giving thereof to the shareholders.

 

6.NONCIRCUMVENTION.
The Company hereby covenants and agrees that the Company will not, by amendment of its Articles of Incorporation, Bylaws or through
any reorganization, transfer of assets, consolidation, merger, scheme of arrangement, dissolution, issue or sale of securities,
or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, and will
at all times in good faith carry out all the provisions of this Warrant and take all action as may be required to protect the rights
of the Holder. Without limiting the generality of the foregoing, the Company (i) shall not increase the par value of any shares
of Common Stock receivable upon the exercise of this Warrant above the Exercise Price then in effect, (ii) shall take all
such actions as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable
shares of Common Stock upon the exercise of this Warrant, and (iii) shall, so long as this Warrant is outstanding, take all action
necessary to reserve and keep available out of its authorized and unissued shares of Common Stock, solely for the purpose of effecting
the exercise of this Warrant, 130% of the number of shares of Common Stock as shall from time to time be necessary to effect the
exercise of this Warrant (without regard to any limitations on exercise).

 

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7.REISSUANCE OF WARRANTS.

 

(a)Transfer of Warrant.
If this Warrant is to be transferred, the Holder shall surrender this Warrant to the Company, whereupon the Company will forthwith
issue and deliver upon the order of the Holder a new Warrant (in accordance with Section 7(d)), registered as the Holder may request,
representing the right to purchase the number of Warrant Shares being transferred by the Holder and, if less than the total number
of Warrant Shares then underlying this Warrant is being transferred, a new Warrant (in accordance with Section 7(d)) to the Holder
representing the right to purchase the number of Warrant Shares not being transferred.

 

(b)Lost, Stolen
or Mutilated Warrant. Upon receipt by the Company of evidence reasonably satisfactory to the Company of the loss, theft, destruction
or mutilation of this Warrant, and, in the case of loss, theft or destruction, of any indemnification undertaking by the Holder
to the Company in customary form and, in the case of mutilation, upon surrender and cancellation of this Warrant, the Company shall
execute and deliver to the Holder a new Warrant (in accordance with Section 7(d)) representing the right to purchase the Warrant
Shares then underlying this Warrant.

 

(c)Exchangeable
for Multiple Warrants. This Warrant is exchangeable, upon the surrender hereof by the Holder at the principal office of the
Company, for a new Warrant or Warrants (in accordance with Section 7(d)) representing in the aggregate the right to purchase the
number of Warrant Shares then underlying this Warrant, and each such new Warrant will represent the right to purchase such portion
of such Warrant Shares as is designated by the Holder at the time of such surrender; provided, however, that no Warrants for fractional
shares of Common Stock shall be given.

 

(d)Issuance of New
Warrants. Whenever the Company is required to issue a new Warrant pursuant to the terms of this Warrant, such new Warrant (i)
shall be of like tenor with this Warrant, (ii) shall represent, as indicated on the face of such new Warrant, the right to purchase
the Warrant Shares then underlying this Warrant (or in the case of a new Warrant being issued pursuant to Section 7(a) or Section
7(c), the Warrant Shares designated by the Holder which, when added to the number of shares of Common Stock underlying the other
new Warrants issued in connection with such issuance, does not exceed the number of Warrant Shares then underlying this Warrant),
(iii) shall have an issuance date, as indicated on the face of such new Warrant which is the same as the Issuance Date, and (iv)
shall have the same rights and conditions as this Warrant.

 

    	11

    	 

    

 

8.NOTICES.
Whenever notice is required to be given under this Warrant, unless otherwise provided herein, such notice shall be given to the
Holder at the following address: 1100 Glendon Ave., Suite 850, Los Angeles, CA 90024. The Company shall provide the Holder with
prompt written notice of all actions taken pursuant to this Warrant, including in reasonable detail a description of such action
and the reason therefore. Without limiting the generality of the foregoing, the Company will give written notice to the Holder
(i) immediately upon any adjustment of the Exercise Price, setting forth in reasonable detail, and certifying, the calculation
of such adjustment and (ii) at least fifteen days prior to the date on which the Company closes its books or takes a record (A)
with respect to any dividend or distribution upon the shares of Common Stock, (B) with respect to any grants, issuances or sales
of any Options, Convertible Securities or rights to purchase stock, warrants, securities or other property to holders of shares
of Common Stock or (C) for determining rights to vote with respect to any Fundamental Transaction, dissolution or liquidation,
provided in each case that such information shall be made known to the public prior to or in conjunction with such notice being
provided to the Holder.

 

9.AMENDMENT AND
WAIVER. Except as otherwise provided herein, the provisions of this Warrant may be amended and the Company may take any action
herein prohibited, or omit to perform any act herein required to be performed by it, only if the Company has obtained the written
consent of the Holder.

 

10.GOVERNING LAW.
This Warrant shall be governed by and construed and enforced in accordance with, and all questions concerning the construction,
validity, interpretation and performance of this Warrant shall be governed by, the internal laws of the State of New York, without
giving effect to any choice of law or conflict of law provision or rule (whether of the State of New York or any other jurisdictions)
that would cause the application of the laws of any jurisdictions other than the State of New York.

 

11.CONSTRUCTION;
HEADINGS. This Warrant shall be deemed to be jointly drafted by the Company and the Holder and shall not be construed against
any person as the drafter hereof. The headings of this Warrant are for convenience of reference and shall not form part of, or
affect the interpretation of, this Warrant.

 

12.DISPUTE RESOLUTION.
In the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the Warrant Shares, the
Company shall submit the disputed determinations or arithmetic calculations via facsimile within two Business Days of receipt of
the Exercise Notice giving rise to such dispute, as the case may be, to the Holder. If the Holder and the Company are unable to
agree upon such determination or calculation of the Exercise Price or the Warrant Shares within three Business Days of such disputed
determination or arithmetic calculation being submitted to the Holder, then the Company shall, within two Business Days submit
via facsimile (a) the disputed determination of the Exercise Price to an independent, reputable investment bank selected by the
Company and approved by the Holder, or (b) the disputed arithmetic calculation of the Warrant Shares to the Company's independent,
outside accountant. The Company shall cause at its expense the investment bank or the accountant, as the case may be, to perform
the determinations or calculations and notify the Company and the Holder of the results no later than ten Business Days from the
time it receives the disputed determinations or calculations. Such investment bank's or accountant's determination or calculation,
as the case may be, shall be binding upon all parties absent demonstrable error, provided however that if the determination is
made by the Company's accountants, the Holder may request that a second accounting firm that is determined by the Holder to be
independent also perform its own calculation to confirm the first calculation.

 

    	12

    	 

    

 

13.REMEDIES, OTHER
OBLIGATIONS, BREACHES AND INJUNCTIVE RELIEF. The remedies provided in this Warrant shall be cumulative and in addition to all
other remedies available under this Warrant and the other Transaction Documents, at law or in equity (including a decree of specific
performance and/or other injunctive relief), and nothing herein shall limit the right of the Holder right to pursue actual damages
for any failure by the Company to comply with the terms of this Warrant. The Company acknowledges that a breach by it of its obligations
hereunder will cause irreparable harm to the Holder and that the remedy at law for any such breach may be inadequate. The Company
therefore agrees that, in the event of any such breach or threatened breach, the holder of this Warrant shall be entitled, in addition
to all other available remedies, to an injunction restraining any breach, without the necessity of showing economic loss and without
any bond or other security being required.

 

14.TRANSFER.
This Warrant may be offered for sale, sold, transferred or assigned without the consent of the Company.

 

15.SEVERABILITY.
If any provision of this Agreement is prohibited by law or otherwise determined to be invalid or unenforceable by a court of competent
jurisdiction, the provision that would otherwise be prohibited, invalid or unenforceable shall be deemed amended to apply to the
broadest extent that it would be valid and enforceable, and the invalidity or unenforceability of such provision shall not affect
the validity of the remaining provisions of this Agreement so long as this Agreement as so modified continues to express, without
material change, the original intentions of the parties as to the subject matter hereof and the prohibited nature, invalidity or
unenforceability of the provision(s) in question does not substantially impair the respective expectations or reciprocal obligations
of the parties or the practical realization of the benefits that would otherwise be conferred upon the parties. The parties will
endeavor in good faith negotiations to replace the prohibited, invalid or unenforceable provision(s) with a valid provision(s),
the effect of which comes as close as possible to that of the prohibited, invalid or unenforceable provision(s).

 

16.CERTAIN DEFINITIONS.
For purposes of this Warrant, the following terms shall have the following meanings:

 

(a)"Bloomberg"
means Bloomberg Financial Markets.

 

(b)"Business
Day" means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized
or required by law to remain closed.

 

    	13

    	 

    

 

(c)"Closing
Bid Price" and "Closing Sale Price" means, for any security as of any date, the last closing bid price
and last closing trade price, respectively, for such security on the Principal Market, as reported by Bloomberg, or, if the Principal
Market begins to operate on an extended hours basis and does not designate the closing bid price or the closing trade price, as
the case may be, then the last bid price or last trade price, respectively, of such security prior to 4:00:00 p.m., New York Time,
as reported by Bloomberg, or, if the Principal Market is not the principal securities exchange or trading market for such security,
the last closing bid price or last trade price, respectively, of such security on the principal securities exchange or trading
market where such security is listed or traded as reported by Bloomberg, or if the foregoing do not apply, the last closing bid
price or last trade price, respectively, of such security in the over-the-counter market on the electronic bulletin board for such
security as reported by Bloomberg, or, if no closing bid price or last trade price, respectively, is reported for such security
by Bloomberg, the average of the bid prices, or the ask prices, respectively, of any market makers for such security as reported
in the "pink sheets" by Pink Sheets LLC (formerly the National Quotation Bureau, Inc.). If the Closing Bid Price or the
Closing Sale Price cannot be calculated for a security on a particular date on any of the foregoing bases, the Closing Bid Price
or the Closing Sale Price, as the case may be, of such security on such date shall be the fair market value as mutually determined
by the Company and the Holder. If the Company and the Holder are unable to agree upon the fair market value of such security, then
such dispute shall be resolved pursuant to Section 12. All such determinations to be appropriately adjusted for any stock dividend,
stock split, stock combination or other similar transaction during the applicable calculation period.

 

(d)"Common Stock" means
(i) the Company's shares of Common Stock, par value $0.0001 per share, and (ii) any share capital into which such Common
Stock shall have been changed or any share capital resulting from a reclassification of such Common Stock.

 

(e)"Convertible Securities"
means any stock or securities (other than Options) directly or indirectly convertible into or exercisable or exchangeable for shares
of Common Stock.

 

(f)"Eligible
Market" means the Principal Market, the NYSE Amex, The New York Stock Exchange, Inc., The NASDAQ Global Market, The NASDAQ
Capital Market or The NASDAQ Global Select Market.

 

(g)"Expiration
Date" means sixty (60) months after the Issuance Date or, if any such date falls on a day other than a Business Day or
on which trading does not take place on the Principal Market (a "Holiday"), the next day that is not a Holiday.

 

    	14

    	 

    

 

(h)"Fundamental
Transaction" means that (i) the Company shall, directly or indirectly, in one or more related transactions, (A) consolidate
or merge with or into (whether or not the Company is the surviving corporation) another Person or Persons, if the holders of the
Voting Stock (not including any shares of Voting Stock held by the Person or Persons making or party to, or associated or affiliated
with the Persons making or party to, such consolidation or merger) immediately prior to such consolidation or merger shall hold
or have the right to direct the voting of less than 50% of the Voting Stock or such voting securities of such other surviving Person
immediately following such transaction, or (B) sell, assign, transfer, convey or otherwise dispose of all or substantially all
of the properties or assets of the Company to another Person, or (C) allow another Person to make a purchase, tender or exchange
offer that is accepted by the holders of more than the 50% of the outstanding shares of Voting Stock (not including any shares
of Voting Stock held by the Person or Persons making or party to, or associated or affiliated with the Persons making or party
to, such purchase, tender or exchange offer), or (D) consummate a stock purchase agreement or other business combination (including,
without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with another Person whereby such other
Person acquires more than the 50% of the outstanding shares of Voting Stock (not including any shares of Voting Stock held by the
other Person or other Persons making or party to, or associated or affiliated with the other Persons making or party to, such stock
purchase agreement or other business combination), (E) reorganize, recapitalize or reclassify its Common Stock or (ii) any "person"
or "group" (as these terms are used for purposes of Sections 13(d) and 14(d) of the Exchange Act) is or shall become
the "beneficial owner" (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of 50% of the aggregate
Voting Stock of the Company.

 

(i)"Options" means any
rights, warrants or options to subscribe for or purchase shares of Common Stock or Convertible Securities.

 

(j)"Parent
Entity" of a Person means an entity that, directly or indirectly, controls the applicable Person and whose common stock
or equivalent equity security is quoted or listed on an Eligible Market, or, if there is more than one such Person or Parent Entity,
the Person or Parent Entity with the largest public market capitalization as of the date of consummation of the Fundamental Transaction.

 

(k)"Person"
means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization,
any other entity and a government or any department or agency thereof.

 

(l)"Principal
Market" means the NASDAQ Global Market.

 

(m)"Public
Successor" means a Successor Entity that is not a publicly traded corporation whose common stock is quoted on or listed
for trading on an Eligible Market.

 

(n)"Successor
Entity" means the Person (or, if so elected by the Holder, the Parent Entity) formed by, resulting from or surviving any
Fundamental Transaction or the Person (or, if so elected by the Holder, the Parent Entity) with which such Fundamental Transaction
shall have been entered into.

 

(o)"Trading
Day" means any day on which the Common Stock is traded on the Principal Market, or, if the Principal Market is not the
principal trading market for the Common Stock, then on the principal securities exchange or securities market on which the Common
Stock is then traded; provided that "Trading Day" shall not include any day on which the Common Stock is scheduled to
trade on such exchange or market for less than 4.5 hours or any day that the Common Stock is suspended from trading during the
final hour of trading on such exchange or market (or if such exchange or market does not designate in advance the closing time
of trading on such exchange or market, then during the hour ending at 4:00:00 p.m., New York Time).

 

    	15

    	 

    

 

(p)"Voting
Stock" of a Person means capital stock of such Person of the class or classes pursuant to which the holders thereof have
the general voting power to elect, or the general power to appoint, at least a majority of the board of directors, managers or
trustees of such Person (irrespective of whether or not at the time capital stock of any other class or classes shall have or might
have voting power by reason of the happening of any contingency).

 

[Signature Page Follows]

 

    	16

    	 

    

 

IN WITNESS WHEREOF,
the Company has caused this Warrant to Purchase Common Stock to be duly executed as of the Issuance Date set out above.

 

	 	Lilis
                                         Energy, Inc.

	 	 	 
	 	By:	/s/
    Abraham Mirman
	 	Name:	Abraham
    Mirman
	 	Title:	Chief
    Executive Officer

 

    	17

    	 

    

EXHIBIT A

 

EXERCISE NOTICE

 

TO BE EXECUTED BY THE REGISTERED HOLDER
TO EXERCISE THIS

WARRANT TO PURCHASE COMMON STOCK

 

LILIS ENERGY,
INC.

  

The undersigned holder
hereby exercises the right to purchase _________________ of the shares of Common Stock ("Warrant Shares") of Lilis
Energy, Inc., a Nevada corporation (the "Company"), evidenced by the attached Warrant to Purchase Common Stock
(the "Warrant"). Capitalized terms used herein and not otherwise defined shall have the respective meanings set
forth in the Warrant.

 

1. Payment of Exercise Price. The holder
shall pay the Aggregate Exercise Price in the sum of $___________________ to the Company in accordance with the terms of the Warrant.

 

2. Delivery of Warrant Shares. The
Company shall deliver to the holder __________ Warrant Shares in accordance with the terms of the Warrant.

 

Date: _______________ __, ______

 

_____________________________

Name of Registered Holder

 

	By:		 
	 	Name:	
	 	Title:	

  

    	18

    	 

    

 

ACKNOWLEDGMENT

 

The Company hereby acknowledges
this Exercise Notice and hereby directs [Name of Transfer Agent] to issue the above indicated number of shares of Common Stock
in accordance with the Transfer Agent Instructions dated _____________ from the Company and acknowledged and agreed to by [Name
of Transfer Agent].

  

	 	LILIS ENERGY, INC.
	 	 	 
	 	By:	
	 	Name:	
	 	Title:	

 

 

19Exhibit 10.9

 

SEPARATION
AGREEMENT

 

This
Separation Agreement (this “Agreement”) is made this 1st day of August, 2014 by and between Lilis Energy, Inc. (“Lilis”
or the “Company”) and Robert A. Bell (“Bell”). As used herein, “Parties” means, collectively,
Lilis and Bell, and “Party” means either Lilis or Bell.

 

RECITALS

 

WHEREAS, Lilis and Bell are parties to that
Employment Agreement dated May 1, 2014 (the “Employment Agreement”);

 

WHEREAS, Lilis and Bell agree that, effective
August 1, 2014 (the “Separation Date”), Bell voluntarily resigned from his positions as officer and employee of Lilis
and any of its subsidiaries, including his positions of President and Chief Operating Officer and member of the Board of Directors
of Lilis; and

 

WHEREAS, in exchange for the consideration
provided herein, Bell has agreed to (a) release all claims that Bell may have against the Company, including all his remaining
rights (if any) in, to and under the Employment Agreement and any other interests or claims he might have against the Company
arising from his efforts as President, Chief Operating Officer or member of the Board of Directors, and (b) confirm certain surviving
provisions under the Employment Agreement, and Lilis has agreed to provide the payments and other consideration specified herein.

 

NOW, THEREFORE, in consideration of the provisions
herein, and other good and valuable consideration the receipt and sufficiency of which are hereby acknowledged by Lilis and Bell,
the Parties agree as follows:

 

		1.	Resignation.
                                         Effective as of the Separation Date, Bell resigned, and Lilis accepted such resignation,
                                         from all his positions as officer and employee of Lilis and any of its subsidiaries,
                                         including his positions of President and Chief Operating Officer and member of the Board
                                         of Directors of Lilis.

 

		2.	Existing
                                         Obligations. The following payments and obligations exist independently of this Separation
                                         Agreement and the releases contained herein (the “Existing Obligations”):

 

		(a)	Within
                                         five (5) calendar days after the date this Agreement is executed, Lilis will pay Bell
                                         all compensation due and owing to Bell including but not limited to:

 

(i)
All salary through the date this Agreement is executed;

 

(ii)
All accrued but unused vacation; and

 

(iii)
All unpaid expense reimbursements properly submitted in accordance with Section 4.8(a) of the Employment
Agreement.

 

The
foregoing payments shall be less all applicable state and federal withholding and other lawful deductions.

 

		(b)	Within
                                         five (5) calendar days after the date this Agreement is executed, Lilis will (in full
                                         settlement of the terms of the signing bonus and stock grant obligations under Section
                                         4.2 of the Employment Agreement):

 

(i)
Pay Bell a lump sum of $100,000 (the “Lump Sum Payment”), less all applicable state and federal tax withholdings
and other lawful deductions; and

 

(ii)
Provide to Bell evidence of the issuance of 33,333 shares of the common stock of Lilis to Bell, which vested on May 1, 2014,
pursuant to Section 4.2 of the Employment Agreement and Lilis’s 2012 Equity Incentive Plan (the “Plan”),
relating to his employment as the COO, it being understood that Lilis will satisfy all withholding obligations and other
lawful deductions related to these shares out of the Lump Sum Payment.

 

		3.	Consideration.
                                         Lilis agrees to make the following additional payments to Bell in consideration of the
                                         releases and other consideration provided by Bell under this Agreement, in full satisfaction
                                         of any and all other obligations of Lilis to Bell, under the Employment Agreement or
                                         otherwise (the “Consideration”):

 

		(a)	Within
                                         ten (10) calendar days after the date this Agreement is executed, Lilis will pay Bell
                                         a lump sum of $25,000, less all applicable state and federal tax withholdings and other
                                         lawful deductions.

 

    	 

    	 

    

 

		(b)	Within
                                         ten (10) calendar days after the termination of the Revocation Period (as defined in
                                         Paragraph 6(g) below), on the express condition that Bell does not revoke his waiver
                                         and release of claims under the Age Discrimination in Employment Act, Lilis will:

 

i.
Pay Bell an additional lump sum of $75,000, less all applicable state and federal tax withholdings and other lawful
deductions, and

 

ii.
Issue to Bell 66,667 shares of the common stock of Lilis, which shares shall be fully vested as of the date of issuance, it
being understood that Lilis will satisfy all withholding obligations and other lawful deductions related to these shares out
of the lump sum payment described in Paragraph 3(b)(i).

 

		(c)	Lilis
                                         and Bell agree and acknowledge that if Lilis fails for any reason to remit payment of
                                         the Existing Obligations or Consideration set forth in these Paragraphs 2 and 3 , Bell
                                         will retain his right to pursue claims under the terms of the Employment Agreement that
                                         govern resignation for "Good Reason" (including claims for additional severance
                                         in connection therewith) until such time as such payment of the Existing Obligations
                                         and Consideration are made, and that if Bell elects to pursue any such claims, Lilis
                                         shall retain its right to assert any and all defenses and counterclaims available under
                                         the Employment Agreement or otherwise, without giving effect to the provisions hereof.
                                         All other provisions of this Agreement will remain in full force and effect.

 

		4.	General
                                         Release.

 

		(a)	Except
                                         as otherwise set forth in this Agreement, Bell, for himself, and Lilis, for itself, and
                                         each Party for its respective affiliates, successors, heirs, subrogees, assigns, principals,
                                         agents, partners, employees, associates, attorneys and representatives, voluntarily,
                                         knowingly and intentionally releases and discharges the other Party and its respective
                                         predecessors, successors, parents, subsidiaries, affiliates and assigns and each of its
                                         respective officers, directors, principals, shareholders, agents, attorneys, board members,
                                         and employees (the "Released Parties") from any and all claims, actions, liabilities,
                                         demands, rights, damages, costs, expenses, and attorneys’ fees (including but not
                                         limited to any claim of entitlement for attorneys’ fees under any contract, statute,
                                         or rule of law allowing a prevailing party or plaintiff to recover attorneys’ fees),
                                         of every kind and description through the date hereof (the “Released Claims”).
                                         Lilis expressly agrees and assents that this General Release includes a release of any
                                         and all claims, actions, liabilities, demands, rights, damages, costs, expenses, and
                                         attorneys’ fees (including but not limited to any claim of entitlement for attorneys’
                                         fees under any contract, statute, or rule of law allowing a prevailing party or plaintiff
                                         to recover attorneys’ fees), of every kind and description against Pierre Caland,
                                         Peak Oil LLC, Peak Oil Holdings LLC and Peak Operator LLC arising out of or related to
                                         the service of Bell or any other employee of Peak Operator LLC at Bell’s direction,
                                         as an officer, director, employee or consultant to Lilis (each such party to be included
                                         as a "Released Party" and each such claim to be included as a "Released
                                         Claim").

 

		(b)	The
                                         Released Claims include but are not limited to those which arise out of, relate to, or
                                         are based upon: (i) Bell’s employment with Lilis and the termination thereof,
                                         (ii) statements, acts or omissions by the Parties whether in their individual or
                                         representative capacities, (iii) express or implied agreements between the Parties (including
                                         the Employment Agreement), except as provided in this Agreement, (iv) any severance,
                                         stock, or stock option grant, agreement, or plan, except as provided in this Agreement,
                                         (v) all federal, state, and municipal statutes, ordinances, and regulations, including,
                                         but not limited to, claims of discrimination based on race, color, national origin, age,
                                         sex, sexual orientation, religion, disability, veteran status, whistleblower status,
                                         public policy, or any other characteristic of Bell under the Age Discrimination in Employment
                                         Act, the Older Workers Benefit Protection Act, the Americans with Disabilities Act, the
                                         Equal Pay Act, Title VII of the Civil Rights Act of 1964 (as amended), the Employee Retirement
                                         Income Security Act of 1974, the Rehabilitation Act of 1973, the Worker Adjustment and
                                         Retraining Notification Act, or any other federal, state, or municipal law prohibiting
                                         discrimination or termination for any reason, (vi) common law, including but not
                                         limited to claims for breach of contract, tort, defamation, slander or emotional distress,
                                         (vii) taxes, penalties, or interest assessed against vested or unvested compensation
                                         paid, provided, or granted to Bell by the Company, including all such claims that may
                                         arise based on the application of Code Section 409A, and (viii) any claim which
                                         was or could have been raised; provided, notwithstanding anything to the contrary in
                                         this Agreement. The “Released Claims” shall not include rights or obligations
                                         under this Agreement, Article 5 of the Employment Agreement, COBRA, any 401(k) plan or
                                         matters arising out of or in connection with claims by governmental authorities or self-regulatory
                                         organizations involving actual or potential violations of the securities laws, rules
                                         or regulations applicable to Lilis, any existing rights Bell has to indemnification,
                                         contribution and a defense from Lilis for the time that Bell was an officer and director
                                         of Lilis, any rights Bell has to any D&O and general liability insurance coverage
                                         of Lilis, any rights that Bell has as a shareholder of Lilis arising after the date hereof,
                                         and any rights which cannot be waived or released as a matter of law.

 

    	2

    	 

    

 

Moreover,
nothing contained in this Agreement is intended to prohibit or restrict either party in any way from (1) bringing a lawsuit against
the other to enforce the obligations under this Agreement; (2) providing information to, or testifying or otherwise assisting
in any investigation or proceeding brought by, any federal regulatory or law enforcement agency or legislative body, any self-regulatory
organization, or Lilis’ legal, compliance or human resources officers; (3) testifying or participating in or otherwise assisting
in a proceeding relating to an alleged violation of any federal, state or municipal law relating to fraud or any rule or regulation
of the Securities and Exchange Commission or any self-regulatory organization; or (4) filing any claims that are not permitted
to be waived or released under applicable law (although the ability to recover damages or other relief is still waived and released
to the extent permitted by law).

 

		(c)	The
                                         releases in this paragraph 4 shall be construed in the broadest sense possible and shall
                                         be effective as a prohibition to all claims, charges, actions, suits, demands, obligations,
                                         damages, injuries, liabilities, losses, and causes of action of every character, nature,
                                         kind or description, known or unknown, and suspected or unsuspected that the Parties
                                         may have against the Released Parties. The Parties hereby expressly acknowledge that
                                         they are aware of the existence of California Civil Code § 1542 and its meaning
                                         and effect. The Parties expressly acknowledge that they have read and understood the
                                         following provision of that section which provides:

 

“A
GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME
OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.”

 

The
Parties expressly waive and release any right to benefits that they may have under California Civil Code § 1542 to the fullest
extent they may do so lawfully. The Parties further acknowledge that they may later discover facts different from or in addition
to those facts now known to them or believe by them to be true with respect to any or all of the matters covered by this Agreement,
and the Parties agree that this Agreement nevertheless shall remain in full and complete force and effect.

 

		5.	Survival
                                         of Provisions of the Employment Agreement. The Parties expressly acknowledge and
                                         agree that notwithstanding Paragraph 12 of this Agreement, the following provisions of
                                         the Employment Agreement will continue in full force and effect: Section 4.2 (as specified
                                         in this Agreement) of Article 4, Article 5 and Sections 8.1-8.4, 8.6-8.9, 8.11-8.14,
                                         and 8.16-8.18 of Article 8; provided, however, that any provisions of the Employment
                                         Agreement that expire by their terms shall no longer have any force or effect. The Parties
                                         expressly acknowledge and agree that Section 7 of the Employment Agreement is no longer
                                         in effect. Any and all claims arising out of Section 7 of the Employment Agreement are
                                         included in "Released Claims" and are released herein. Lilis agrees and acknowledges
                                         that it will take no efforts to enforce Section 7 of the Employment Agreement against
                                         Bell. Lilis agrees and acknowledges that its obligation to Bell pursuant to Section 8.4
                                         of the Employment Agreement to indemnify Bell for any claims arising out of or relating
                                         to his services for Lilis remains in full force and effect.

 

		6.	Representations
                                         and Warranties. Each of Bell and Lilis (except as to subparagraphs (f) and (g) below),
                                         severally and not jointly, warrants and represents as follows:

 

		(a)	He
                                         or it has read this Agreement and agrees to the conditions and obligations set forth
                                         in it.

 

		(b)	He
                                         or it voluntarily executes this Agreement (i) after having been advised to consult
                                         with legal counsel, (ii) after having had opportunity to consult with legal counsel
                                         and (iii) without being pressured or influenced by any statement, representation
                                         or omission of any person acting on behalf of the other or any of its officers, directors,
                                         employees, agents and attorneys.

 

		(c)	Bell
                                         has no knowledge of the existence of any lawsuit, charge or proceeding against Lilis
                                         or any of its officers, directors, employees or agents arising out of or otherwise connected
                                         with any of the matters herein released. Lilis has no knowledge of any lawsuit, charge
                                         or proceeding against Bell arising out of or otherwise connected with any of the matters
                                         herein released.

 

		(d)	He
                                         or it has the individual, corporate, or entity power and authority to execute and deliver
                                         this Agreement and to perform its obligations hereunder and, if such Party is a corporation,
                                         limited liability company or partnership, the execution, delivery, and performance of
                                         this Agreement has been duly authorized by all necessary corporate, company or partnership
                                         action. This Agreement constitutes the legal, valid, and binding obligation of each Party.

 

    	3

    	 

    

 

		(e)	Bell
                                         admits, acknowledges, and agrees that, other than the payments and consideration set
                                         forth in Paragraphs 1 and 3 of this Agreement, Bell has been fully paid or provided all
                                         wages, compensation, salary, commissions, bonuses, expense reimbursements, stock, stock
                                         options, vacation, change in control benefits, severance benefits, deferred compensation,
                                         or other benefits from Lilis, which are or could be due to Bell under the terms of Bell’s
                                         employment or otherwise. Bell admits, acknowledges, and agrees that Bell is not otherwise
                                         entitled to the payments set forth in Paragraph 3 except in exchange for the releases
                                         by Bell contained in this Agreement. Lilis admits, acknowledges, and agrees that, other
                                         than the duties set forth in this Agreement, Bell has fully performed all his duties
                                         and obligations to Lilis, under the Employment Agreement or otherwise.

 

		(f)	Applicable
                                         law provides that Bell shall have at least 21 days to consider this Agreement. In
                                         the event that Bell executes this Agreement prior to the 21st day after receipt of it,
                                         Bell expressly intends such execution as a waiver of any rights Bell has to review the
                                         Agreement for the full 21 days. In such event, Bell represents that such waiver
                                         is voluntary and made without any pressure, representations or incentives from Lilis
                                         for such early execution.

 

		(g)	Bell
                                         understands that this Agreement waives and releases any claims Bell may have under the
                                         Age Discrimination in Employment Act (the “ADEA”). Bell may revoke such waiver
                                         and release of claims under the ADEA for 7 calendar days following its execution (the
                                         “Revocation Period”), and Bell’s waiver and release of claims under
                                         the ADEA shall not become enforceable and effective against Bell or Lilis until 7 calendar
                                         days after such execution. If Bell chooses to revoke this Agreement, Bell must provide
                                         written notice by hand delivery and email to Ron Levine, 1550 Seventeenth Street, Suite
                                         500, Denver, Colorado 80202 (email: ron.levine@dgslaw.com) within 7 calendar days of
                                         Bell’s execution of this Agreement. If Bell does not revoke within Revocation Period,
                                         the right to revoke is lost. If Bell does revoke within the Revocation Period, such revocation
                                         shall only be effective with respect to Bell's ADEA claims, and the releases set forth
                                         in Paragraph 4 above otherwise shall remain in full force and effect.

 

		7.	Non-Disparagement.
                                         Bell agrees not to make to any person any statement that disparages the Company or its
                                         directors, officers, employees or affiliates or reflects negatively upon the Company,
                                         including, without limitation, statements regarding the Company’s financial condition,
                                         business practices, employment practices, or its predecessors, successors, subsidiaries,
                                         officers, directors, employees or affiliates. Lilis and Abraham Mirman and its/his directors,
                                         officers, employees or affiliates agree not to make to any person any statement that
                                         disparages Bell or his affiliates, successors, heirs, subrogees, assigns, principals,
                                         agents, partners, employees, associates, attorneys and representatives, including but
                                         not limited to Pierre Caland, Peak Oil LLC, Peak Oil Holdings LLC, and Peak Operator
                                         LLC. In response to inquiries about Bell’s employment, Bell and the Company shall
                                         make the statement set forth on Exhibit A hereto and file the Form 8-K substantially
                                         as set forth on Exhibit B, and nothing more.

 

		8.	Section 409A.
                                         It is the intention of the parties that compensation or benefits payable under this Agreement
                                         not be subject to the additional tax imposed pursuant to Section 409A of the Code and
                                         this Agreement shall be interpreted accordingly. To the extent such potential payments
                                         or benefits could become subject to additional tax under such Section, the parties shall
                                         cooperate to amend this Agreement with the goal of giving Bell the economic benefits
                                         described herein in a manner that does not result in such tax being imposed. Each payment
                                         or benefit made pursuant to this Agreement shall be deemed to be a separate payment for
                                         purposes of Code Section 409A and each payment made in installments shall be treated
                                         as a series of separate payments for purposes of Code Section 409A, to the extent permitted
                                         under applicable law. In addition, payments or benefits pursuant to this Agreement shall
                                         be exempt from the requirements of Code Section 409A to the maximum extent possible as
                                         “short-term deferrals” pursuant to Treasury Regulation Section 1.409A-1(b)(4),
                                         as exempt reimbursements under Treasury Regulation Section 1.409A-1(b)(9)(v), and/or
                                         under any other exemption that may be applicable, and this Agreement shall be construed
                                         accordingly. The parties agree and acknowledge that Bell incurred a “separation
                                         from service,” as defined in Section 409A of the Code and the Treasury Regulations
                                         thereunder, on the Separation Date. If any payment made hereunder within 6 months of
                                         the Separation Date constitutes deferred compensation that would otherwise be subject
                                         to the additional tax imposed pursuant to Section 409A of the Code as a result of Bell’s
                                         status as a specified employee, then such payment shall instead be payable on the date
                                         that is five (5) days following the earliest to occur of (i) 6 months after Bell’s
                                         “separation from service,” or (ii) Bell’s death. All taxable reimbursements
                                         provided hereunder that are deferred compensation subject to the requirements of Code
                                         Section 409A shall be made not later than the calendar year following the calendar year
                                         in which the expense was incurred. Any such taxable reimbursements or any taxable in-kind
                                         benefits provided in one calendar year shall not affect the expenses eligible for reimbursement
                                         or in-kind benefits to be provided in any other taxable year.

 

    	4

    	 

    

 

		9.	Successors.
                                         This Agreement shall be binding upon, and inure to the benefit of, any successor to Lilis
                                         or Bell.

 

		10.	Restricted
                                         Assignment. Neither Party may assign, transfer, or delegate this Agreement or any
                                         of its or his rights or obligations under this Agreement without the prior written consent
                                         of the other Party. Any attempted assignment, transfer, or delegation in violation of
                                         the preceding sentence shall be void and of no effect.

 

		11.	Waiver
                                         and Amendment. No term or condition of this Agreement shall be deemed waived other
                                         than by a writing signed by the Party against whom or which enforcement of the waiver
                                         is sought. Without limiting the generality of the preceding sentence, a Party’s
                                         failure to insist upon the other Party’s strict compliance with any provision of
                                         this Agreement or to assert any right that a Party may have under this Agreement shall
                                         not be deemed a waiver of that provision or that right. Any written waiver shall operate
                                         only as to the specific term or condition waived under the specific circumstances and
                                         shall not constitute a waiver of that term or condition for the future or a waiver of
                                         any other term or condition. No amendment or modification of this Agreement shall be
                                         deemed effective unless stated in a writing signed by the Parties.

 

		12.	Entire
                                         Agreement. This Agreement contains the Parties’ entire agreement regarding
                                         Bell’s employment with the Company and the subject matter of this Agreement. This
                                         Agreement supersedes all other and prior agreements and understandings between the Parties,
                                         including the Employment Agreement, except as otherwise provided herein. The Parties
                                         have made no agreements, representations, or warranties regarding the subject matter
                                         of this Agreement that are not set forth in this Agreement.

 

		13.	Notice.
                                         Except as otherwise set forth in this Agreement, each notice or other communication required
                                         or permitted under this Agreement shall be in writing and transmitted, delivered, or
                                         sent by personal delivery, prepaid courier or messenger service (whether overnight or
                                         same-day), or prepaid certified United States mail (with return receipt requested), addressed
                                         (in any case) to the other Party at the address set forth as follows:

 

If to Bell, to:

 

300
E. Esplanade Drive, Suite 1810

Oxnard,
CA 93036

 

With
a copy to:

 

Rapp
& Krock, PC

Attn:
Bradley W. Rapp

3050
Post Oak Blvd, Suite 1425

Houston,
Texas 77056

brapp@rk-lawfirm.com

 

If
to Lilis, to:

 

Lilis
Energy, Inc.

Attention: Chief Financial Officer

1900 Grant Street, Suite #720

Denver, CO 80203

 

With
a copy to:

 

Davis
Graham & Stubbs LLP

Attention: Ron Levine

1550 Seventeenth Street, Suite 500

Denver, Colorado 80202

 

Each
notice or communication so transmitted, delivered, or sent in person, by courier or messenger service, or by certified United
States mail shall be deemed given, received, and effective on the date delivered to or refused by the intended recipient (with
the return receipt, or the equivalent record of the courier or messenger, being deemed conclusive evidence of delivery or refusal).
Nevertheless, if the date of delivery is after 5:00 p.m. on a business day, the notice or other communication shall be deemed
given, received, and effective on the next business day.

 

		14.	Severability.
                                         It is the desire of the Parties hereto that this Agreement be enforced to the maximum
                                         extent permitted by law. Should any provision contained herein be held unenforceable
                                         by a court of competent jurisdiction, the Parties hereby agree and consent that such
                                         provision shall be reformed to create a valid and enforceable provision to the maximum
                                         extent permitted by law; provided, however, if such provision cannot be reformed, it
                                         shall be deemed ineffective and deleted herefrom without affecting any other provision
                                         of this Agreement. This Agreement should be construed by limiting and reducing it only
                                         to the minimum extent necessary to be enforceable under then applicable law.

 

    	5

    	 

    

 

		15.	Title
                                         and Headings; Construction. Titles and headings to sections hereof are for the purpose
                                         of reference only and shall in no way limit, define or otherwise affect the provisions
                                         hereof. The words “herein,” “hereof,” “hereunder”
                                         and other compounds of the word “here” shall refer to the entire Agreement
                                         and not to any particular provision.

 

		16.	Governing
                                         Law; Jurisdiction. All matters or issues relating to the interpretation, construction,
                                         validity, and enforcement of this Agreement shall be governed by the laws of the State
                                         of Colorado, without giving effect to any choice-of-law principle that would cause the
                                         application of the laws of any jurisdiction other than Colorado. Jurisdiction and venue
                                         of any action or proceeding relating to this Agreement or any dispute shall be exclusively
                                         in the state or federal courts in Denver, Colorado.

 

		17.	Counterparts.
                                         This Agreement may be signed in counterparts, with the same effect as if both Parties
                                         had signed the same document. All counterparts shall be construed together to constitute
                                         one, and the same, document.

 

		18.	Cooperation.
                                         Bell hereby agrees that after the date hereof, Bell will reasonably cooperate with
                                         the Company to ensure a smooth transition of management, to continue to protect the Company’s
                                         confidential information and trade secrets in accordance with Articles V and VII of the
                                         Employment Agreement, and to promptly respond to Company inquiries regarding such confidential
                                         information, including, without limitation, any corporate opportunities disclosed or
                                         entrusted to Bell by the Company, its affiliates or third parties during or prior to
                                         Bell’s employment with the Company.

 

    	6

    	 

    

 

IN
WITNESS WHEREOF, the Parties have executed this Agreement to be effective as of the date first above written.

 

	 	BELL:
	 	 	 
	 	/s/
    Robert A. Bell
	 	Name:
    Robert A. Bell 
	 	 	 
	 	LILIS:
	 	 	 
	 	Lilis
    Energy, Inc., a Nevada corporation
	 	 	 
	 	By:	/s/
    Eric Ulwelling
	 	Its:
    Acting Chief Financial Officer
	 	Name:
    Eric Ulwelling

  

    	7

    	 

    

 

Exhibit
A

  

On August
1, 2014, Robert A. Bell resigned his positions as President, Chief Operating Officer and member of the Board of Directors of Lilis
Energy, Inc. in order to focus his full attention on other ongoing roles and responsibilities.

 

    	8

    	 

    

 

Exhibit
B

 

Form
8-K

 

[See
attached]

 

 

9

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