Document:

THIS
      WARRANT AND ANY SHARES OF COMMON STOCK ISSUED UPON EXERCISE HEREOF HAVE NOT
      BEEN
      REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”),
      OR
      UNDER ANY APPLICABLE STATE SECURITIES LAWS, AND HAVE BEEN ACQUIRED FOR
      INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR
      DISTRIBUTION THEREOF. NO SUCH SALE OR DISPOSITION MAY BE MADE WITHOUT AN
      EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL
      SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE
      ACT, OR APPLICABLE STATE SECURITIES LAWS.

     

    WHERIFY
      WIRELESS, INC.

     

    WARRANT
      TO PURCHASE

     

    3,000,000
      SHARES

     

    OF
      COMMON STOCK

     

    (Void
      after February 22, 2012)

     

    No:
      BW-2

     

    This
      certifies that for value, Laidlaw
      & Company (UK) Ltd.,
      or its
      registered assigns (the “Holder”),
      is
      entitled, subject to the terms set forth below, at any time from and after
      February 22, 2007 (the “Original
      Issuance Date”)
      and
      before 5:00 p.m., Eastern Time, on February 22, 2012 (the “Expiration
      Date”),
      to
      purchase from WHERIFY
      WIRELESS, INC.,
      a
      Delaware corporation (the “Company”),
      three
      million (3,000,000) shares of common stock, par value $0.01 per share, of the
      Company (the “Common
      Stock”),
      upon
      surrender hereof, at the principal office of the Company referred to below,
      with
      a duly executed subscription form in the form attached hereto as Exhibit A
      and
      simultaneous payment therefor in lawful, immediately available money of the
      United States or otherwise as hereinafter provided, at an initial exercise
      price
      per share of $0.10 (the “Purchase
      Price”).
      The
      Purchase Price is subject to further adjustment as provided in Section 5
      below.
      The term “Common
      Stock”
shall
      include, unless the context otherwise requires, the stock and other securities
      and property at the time receivable upon the exercise of this Warrant. The
      term
“Warrant,”
as
      used herein, shall mean this Warrant and any other Warrants delivered in
      substitution or exchange therefor as provided herein. 

     

    This
      Warrant was issued in connection with the Company’s private placement offering
      (the “Offering”)
      of its
      10% $1,200,000 aggregate principal amount senior convertible promissory note
      (the “Note”),
      pursuant to the terms and conditions of the Securities Purchase and Option
      Agreement, dated February 22, 2007, by and between the Company and GPS
      Associates, LLC (the “SPA”).
      

     

    1.  Exercise.
      This
      Warrant may be exercised at any time or from time to time from and after the
      Original Issuance Date and before the Expiration Date, on any business day,
      for
      the full number of shares of Common Stock called for hereby, by surrendering
      it
      at the principal office of the Company, at 901 Mariners Island Blvd., Suite
      300,
      San Mateo, CA 94404, with the subscription form duly executed, together with
      payment in an amount equal to (a) the number of shares of Common Stock
      called for on the face of this Warrant, multiplied (b) by the Purchase
      Price. Payment of the Purchase Price may be made at Holder’s choosing either:
      (1) by payment in immediately available funds; or (2) in lieu of any
      cash payment, in exchange for the number of shares of Common Stock equal to
      the
      product of (x) the number of shares to which the Warrants are being
      exercised multiplied by (y) a fraction, the numerator of which is the Purchase
      Price and the denominator of which is the Fair Market Value (as defined below).
      This warrant may be exercised for less than the full number of shares of Common
      Stock at the time called for hereby, except that the number of shares receivable
      upon the exercise of this Warrant as a whole, and the sum payable upon the
      exercise of this Warrant as a whole, shall be proportionately reduced. Upon
      a
      partial exercise of this Warrant in accordance with the terms hereof, this
      Warrant shall be surrendered, and a new Warrant of the same tenor and for the
      purchase of the number of such shares not purchased upon such exercise shall
      be
      issued by the Company to Holder without any charge therefor. A Warrant shall
      be
      deemed to have been exercised immediately prior to the close of business on
      the
      date of its surrender for exercise as provided above, and the person entitled
      to
      receive the shares of Common Stock issuable upon such exercise shall be treated
      for all purposes as the holder of such shares of record as of the close of
      business on such date. Within two (2) business days after such date, the
      Company shall issue and deliver to the person or persons entitled to receive
      the
      same a certificate or certificates for the number of full shares of Common
      Stock
      issuable upon such exercise, together with cash, in lieu of any fraction of
      a
      share, equal to such fraction of the then Fair Market Value on the date of
      exercise of one full share of Common Stock. 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    2.  “Fair
      Market Value”
shall
      mean, as of any date: (i) if shares of the Common Stock are listed on a
      national securities exchange, the average of the closing prices as reported
      for
      composite transactions during the ten (10) consecutive trading days preceding
      the trading day immediately prior to such date or, if no sale occurred on a
      trading day, then the mean between the closing bid and asked prices on such
      exchange on such trading day; (ii) if shares of the Common Stock are not so
      listed but are traded on the NASDAQ National Market (“NNM”),
      the
      average of the closing prices as reported on the NNM during the ten (10)
      consecutive trading days preceding the trading day immediately prior to such
      date or, if no sale occurred on a trading day, then the mean between the highest
      bid and lowest asked prices as of the close of business on such trading day,
      as
      reported on the NNM; or if applicable, the Nasdaq Capital Market (“NCM”),
      (iii) if not then included for quotation on the NNM or the NCM, the average
      of the highest reported bid and lowest reported asked prices as reported by
      the
      OTC Bulletin Board of the National Quotation Bureau, as the case may be; or
      (iv) if the shares of the Common Stock are not then publicly traded, the
      fair market price of the Common Stock as determined in good faith by the
      independent members of the Board of Directors of the Company and the Holders
      of
      all Warrants. 

     

    3.  Shares
      Fully Paid; Payment of Taxes.
      All
      shares of Common Stock issued upon the exercise of this Warrant shall be validly
      issued, fully paid and non-assessable, and the Company shall pay all taxes
      and
      other governmental charges (other than income taxes to the holder) that may
      be
      imposed in respect of the issue or delivery thereof.

     

    4.  Transfer
      and Exchange

     

    (a)     Neither
      this Warrant nor the Common Stock to be issued upon exercise hereof (the
“Warrant
      Shares”)
      have
      been registered under the Act or any state securities laws (“Blue
      Sky Laws”).
      This
      Warrant has been acquired for investment purposes and not with a view to
      distribution or resale and may not be pledged, hypothecated, sold, made subject
      to a security interest, or otherwise transferred without: (i) an effective
      registration statement for such Warrant under the Act and such applicable Blue
      Sky Laws; or (ii) an opinion of counsel reasonably satisfactory to the
      Company that registration is not required under the Act or under any applicable
      Blue Sky Laws. 

     

    (b)    
      Upon
      compliance with applicable federal and state securities laws as set forth in
      Section 4(a),
      above,
      this Warrant and all rights hereunder are transferable, in whole or in part,
      on
      the books of the Company maintained for such purpose at its Principal Office
      by
      the Holder in person or by duly authorized attorney, upon surrender of this
      Warrant together with a completed and executed assignment form in the form
      attached hereto as Exhibit
      B,
      and
      payment of any necessary transfer tax or other governmental charge imposed
      upon
      such transfer. Upon any partial transfer, the Company will issue and

     

    
      
        
        

      

      
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    deliver
      to the assignee a new Warrant with respect to the shares of Common Stock for
      which it is exercisable that have been transferred, and will deliver to the
      Holder a new Warrant or Warrants with respect to the shares of Common Stock
      not
      so transferred. A Warrant may be transferred only by the procedure set forth
      herein. No transfer shall be effective until such transfer is recorded on the
      books of the Company, provided that such transfer is recorded promptly by the
      Company, and until such transfer on such books, the Company shall treat the
      registered Holder hereof as the owner of the Warrant for all purposes.

     

    (c)  This
      Warrant is exchangeable at the Principal Office for two or more new Warrants,
      each in the form of this Warrant, to purchase the same aggregate number of
      shares of Common Stock, each new Warrant to represent the right to purchase
      such
      number of shares as the Holder shall designate at the time of such exchange,
      but
      which shall not exceed the total number of shares for which this Warrant may
      be
      from time to time exercisable. 

     

    (d)  Transfer
      of the Warrant Shares issued upon the exercise of this Warrant shall be
      restricted in the same manner and to the same extent as the Warrant, and the
      certificates representing such Warrant Shares shall bear substantially the
      following legend, until such Warrant Shares have been registered under the
      Act
      or may be removed as otherwise permitted under the Act: 

     

    “THE
      SHARES OF COMMON STOCK REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
      UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR ANY APPLICABLE
      STATE SECURITIES LAW AND MAY NOT BE TRANSFERRED UNTIL (i) A REGISTRATION
      STATEMENT UNDER THE ACT OR SUCH APPLICABLE STATE SECURITIES LAWS SHALL HAVE
      BECOME EFFECTIVE WITH REGARD THERETO, OR (ii) IN THE OPINION OF COUNSEL
      SATISFACTORY TO THE COMPANY, REGISTRATION UNDER THE ACT OR SUCH APPLICABLE
      STATE
      SECURITIES LAWS IS NOT REQUIRED IN CONNECTION WITH SUCH PROPOSED TRANSFER.”

     

    (e)  The
      Holder and the Company agree to execute such other documents and instruments
      as
      counsel to the Company deems necessary to effect the compliance of the issuance
      of this Warrant and any Warrant Shares issued upon exercise hereof with
      applicable federal and state securities laws, including compliance with
      applicable exemptions from the registration requirements of such laws.

     

    5.  Adjustment
      Of Purchase Price And Number Of Warrant Shares Issuable.
      

     

    (a)  For
      purposes of this Section 5,
      “Convertible
      Security”
means
      any stock or securities, directly or indirectly, convertible into or
      exchangeable for Common Equity (as hereinafter defined) , including without
      limitation any exchangeable debt securities; “Option”
shall
      mean any rights or options to subscribe for or purchase Common Equity or
      Convertible Securities. 

     

    (b)  If
      and
      whenever the Company issues or sells or, in accordance with Section 5(c),
      is
      deemed to have issued or sold, any share of Common Equity without consideration
      or for a net consideration per share less than $0.10 (as adjusted for stock
      splits, dividends, recapitalizations, reclassifications and other similar
      events), then immediately upon such issuance or sale, the Purchase Price shall
      be adjusted 

     

    
      
        
        

      

      
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    to
      a
      price equal to the following: the applicable Exercise Price in effect
      immediately prior to the Dilutive Issuance (the “Old Exercise Price”) multiplied
      by the quotient obtained by dividing: (i) an amount equal to the sum of
      (x) the Fully Diluted Equity, plus (y) the number of shares of Common
      Equity which the consideration received by the Company upon the Dilutive
      Issuance would purchase at such Old Exercise Price, by (ii) the Fully
      Diluted Equity after the Dilutive Issuance.

     

    Notwithstanding
      the foregoing, there shall be no adjustment to the Purchase Price with respect
      to:

     

    
      	(i)  	
              Common
                Stock issued or issuable upon conversion of the Note and/or this
                Warrant;

            

    

     

    
      	(ii)  	
              Common
                Stock issued or issuable upon conversion and/or exercise of any securities
                outstanding on the Original Issuance
                Date;

            

    

     

    
      	(iii)  	
              Common
                Stock or securities convertible into Common Stock issuable upon the
                conversion or exercise of securities issuable to Laidlaw & Company
                (UK) Ltd. in connection with the sale of Notes and the Warrants to
                investors;

            

    

     

    
      	(iv)  	
              Common
                Stock issuable pursuant to stock option plans which have been approved
                by
                the Corporation’s directors and shareholders, but only to the extent that
                the aggregate number of shares of Common Stock and securities providing
                for the right to acquire Common Stock, issued under all of such plans
                to
                all officers, directors and employees, does not, in any twelve (12)
                month
                period, exceed, in the aggregate, ten percent (10%) of the total
                number of
                shares of Common Stock issued and outstanding at the beginning of
                such
                twelve (12) month period; and

            

    

     

    
      	(v)  	
              Common
                Stock or options, warrants or other rights to acquire or securities
                convertible into or exchangeable for shares of Common Stock, which
                are
                issued to any non-affiliated third party in connection with (A) the
                acquisition of all of the issued and outstanding equity interests
                of an
                unaffiliated corporation or other entity; (B) the merger of any such
                entity described in clause (A) immediately preceding into the Corporation,
                where the Corporation is the surviving entity; or (C) the acquisition
                by
                the Corporation of all or substantially all of the assets of any
                such
                entity described in clause (A) hereof; provided,
                however,
                that in any such case the transaction has been approved by the
                Corporation’s independent and disinterested
                directors.

            

    

     

    For
      purposes of this Section 5,
      “Common
      Equity”
means
      all shares now or hereafter authorized of any class of common stock of the
      Company (including the Common Stock) and any other stock of the Company, however
      designated, authorized on or after the date hereof, which has the right (subject
      always to prior rights of any class or series of preferred stock) to participate
      in any distribution of the assets or earnings of the Company without limit
      as to
      per share amount, and “Fully
      Diluted Equity”
means,
      with respect to the Company at any given time, (A) the number of shares of
      Common Equity actually outstanding at such time, plus (B) the maximum number
      of
      shares of Common Equity that are issuable upon the exercise, exchange or
      conversion of any unexpired right or unexpired option (including the Warrants)
      to subscribe for, to purchase or to receive Common Equity or other securities
      convertible into or exchangeable for Common Equity, including without limitation
      any exchangeable debt securities, regardless of whether any of the foregoing
      are
      actually exercisable at such time; provided, however, the number of shares
      of
      Common Equity outstanding at any given time shall not include shares, directly
      or indirectly, owned or held by or for the account of the Company.

     

    
      
        
        

      

      
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    (c)  For
      purposes of determining the adjusted Purchase Price under Section 5(b)
      above,
      the following shall be applicable:

     

    (1)  CONSIDERATION.
      If any Common Equity, Options or Convertible Securities are issued or sold
      or
      deemed to have been issued or sold for cash, the consideration received therefor
      shall be deemed to be (i) in the case of any public offering of such
      securities for cash, the gross proceeds of such offering (without deduction
      for
      any underwriters discount) and (ii) in the case of any other issuance, sale
      or deemed issuance or sale for cash, the gross amount received by the Company
      therefor. In case any Common Equity, Options or Convertible Securities are
      issued or sold for a consideration other than cash, the amount of the
      consideration other than cash received by the Company shall be the fair market
      value of such consideration. In case any Common Equity, 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 corporation, the amount
      of
      consideration therefor shall be deemed to be the fair market value of such
      portion of the net assets and business of the non-surviving entity as is
      attributable to such Common Equity, Options or Convertible Securities, as the
      case may be. The fair market value of any consideration other than cash shall
      be
      determined by the Company in good faith.

     

    (2)  OPTIONS
      AND CONVERTIBLE SECURITIES. In the case of the granting or sale of any Option
      or
      Convertible Security (whether or not at the time convertible, exercisable or
      exchangeable):

     

    (A)  the
      aggregate maximum number of shares of Common Equity deliverable, directly or
      indirectly, upon exercise of any Option shall be deemed to have been issued
      at
      the time such Option was granted and for a consideration equal to the
      consideration (determined in the manner provided in subsection (1) above),
      if any, received by the Company upon the issuance of such Option plus the
      minimum purchase price provided in such Option for the Common Equity covered
      thereby;

     

    (B)  the
      aggregate maximum number of shares of Common Equity deliverable upon conversion
      of or in exchange for any such Convertible Security, or upon the exercise of
      any
      Option to purchase or acquire any Convertible Security and the subsequent
      conversion or exchange thereof, shall be deemed to have been issued at the
      time
      such Convertible Security was issued or such Option was issued and for a
      consideration equal to the consideration, if any, received by the Company for
      any such Convertible Security and any related Option (excluding any cash
      received on account of accrued interest or accrued dividends), plus the
      additional consideration (determined in the manner provided in subsection
      (1) above), if any, to be received by the Company upon the conversion or
      exchange of such Convertible Security, or upon the exercise of any related
      Option to purchase or acquire any Convertible Security and the subsequent
      conversion or exchange thereof;

     

    (C)  on
      any
      change in the number of shares of Common Equity deliverable, directly or
      indirectly, upon conversion, exercise or exchange of any such Option or
      Convertible Security or any change in the consideration to be received by the
      Company upon such exercise, conversion or exchange, including, but not limited
      to, a change resulting from the anti-dilution provisions thereof, the Purchase
      Price as then in effect shall forthwith be readjusted to such Purchase Price
      as
      would have been obtained had an adjustment been made upon the issuance of such
      Option or Convertible Security upon the basis of such change; and

     

    
      
        
        

      

      
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    (D)  if
      the
      Purchase Price shall have been adjusted upon the issuance of any such Option
      or
      Convertible Security, no further adjustment of the Purchase Price shall be
      made
      for the actual issuance of Common Equity upon any exercise, conversion, or
      exchange thereof; provided, however, that none of the events set forth in
Section 5(c)(2)(A)
      through 5(c)(2)(D),
      inclusive, shall result in any increase in the Purchase Price.

     

    (3)  INTEGRATED
      TRANSACTION. 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 Options shall be deemed to have been issued without
      consideration.

     

    (4)  TREASURY
      SHARES. The number of shares of Common Equity outstanding at any given time
      does
      not include shares owned or held by or for the account of the Company, and
      the
      disposition of any shares so owned or held shall be considered an issuance
      or
      sale of Common Equity.

     

    (5)  RECORD
      DATE. If the Company takes a record of the holders of Common Equity for the
      purpose of entitling them (A) to receive a dividend or other distribution
      payable in Common Equity, Options or in Convertible Securities or (B) to
      subscribe for or purchase Common Equity, Options or Convertible Securities,
      then
      such record date shall be deemed to be the date of the issuance or sale of
      the
      shares of Common Equity 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.

     

    (d)  If
      the
      Company at any time subdivides (by any stock split, stock dividend,
      recapitalization or otherwise) one or more classes of its outstanding shares
      of
      Common Equity into a greater number of shares, the Purchase Price in effect
      immediately prior to such subdivision shall be proportionately reduced and
      the
      number of shares of Common Stock obtainable upon exercise of the Warrant shall
      be proportionately increased. If the Company at any time combines (by reverse
      stock split or otherwise) one or more classes of its outstanding shares of
      Common Stock into a smaller number of shares, the Purchase Price in effect
      immediately prior to such combination shall be proportionately increased and
      the
      number of shares of Common Stock obtainable upon exercise of this Warrant shall
      be proportionately decreased. 

     

    (e)  Any
      recapitalization, reorganization, reclassification, consolidation, merger,
      sale
      of all or substantially all of the Company’s assets or other transaction, in
      each case which is effected in such a way that the holders of Common Equity
      are
      entitled to receive (either directly or upon subsequent liquidation) stock,
      securities or assets with respect to or in exchange for Common Equity is
      referred to herein as a “Corporate
      Change.”
Prior
      to the consummation of any Corporate Change, the Company shall make appropriate
      provision (in form and substance satisfactory to the Warrant Holder) to insure
      that the Warrant Holder shall thereafter have the right to acquire and receive,
      in lieu of or in addition to (as the case may be) the Warrant Shares acquirable
      and receivable upon the exercise of such holder’s Warrants, such shares of
      stock, securities or assets as may be issued or payable with respect to or
      in
      exchange for the number of Warrant Shares acquirable and receivable upon
      exercise of such holder’s Warrant had 

     

    
      
        
        

      

      
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    such
      Corporate Change not taken place. In any such case, the Company shall make
      appropriate provision (in form and substance reasonably satisfactory to the
      Warrant Holder) with respect to such holder’s rights and interests to insure
      that the provisions of this Agreement shall thereafter be applicable to the
      Warrants (including, in the case of any such consolidation, merger or sale
      in
      which the successor entity or purchasing entity is other than the Company,
      any
      adjustment of the Purchase Price based on Section 5
      hereof).
      The Company shall not effect any such consolidation, merger or sale, unless
      prior to the consummation thereof, the successor entity (if other than the
      Company) resulting from consolidation or merger or the entity purchasing such
      assets assumes by written instrument (in form and substance reasonably
      satisfactory to the Warrant Holder), the obligation to deliver to the Warrant
      Holder such shares of stock, securities or assets as, in accordance with the
      foregoing provisions, such holder may be entitled to acquire.

     

    (f)  If
      any
      event occurs of the type contemplated by the provisions of this Section 5
      but not
      expressly provided for by such provisions (including, without limitation, the
      granting of stock appreciation rights, phantom stock rights or other rights
      with
      equity features), then the Company’s Board shall make an appropriate adjustment
      in the Purchase Price and the number of shares of Common Stock obtainable upon
      exercise of this Warrant so as to protect the rights of the Warrant Holder;
      provided that no such adjustment shall increase the Exercise Price or decrease
      the number of shares of Common Stock obtainable as otherwise determined pursuant
      to this Section 5.

     

    (g)  If
      the
      Company declares or pays a dividend upon the Common Equity payable otherwise
      than in cash out of earnings or earned surplus (determined in accordance with
      generally accepted accounting principles, consistently applied) except for
      a
      stock dividend payable in shares of Common Stock (a “Liquidating
      Dividend”),
      then
      the Company shall pay to the Warrant Holder at the time of payment thereof
      the
      Liquidating Dividend which would have been paid to such Warrant Holder on the
      Common Stock had the Warrants been fully exercised immediately prior to the
      date
      on which a record is taken for such Liquidating Dividend, or, if no record
      is
      taken, the date as of which the record holders of Common Equity entitled to
      such
      dividends are to be determined.

     

    (h)  Notices
      of Record Date.
      In
      case:

     

    A.  the
      Company shall take a record of the holders of its Common Stock (or other stock
      or securities at the time receivable upon the exercise of the Warrants) for
      the
      purpose of entitling them to receive any dividend or other distribution, or
      any
      right to subscribe for or purchase any shares of stock of any class or any
      other
      securities, or to receive any other right, or

     

    B.  of
      any
      capital reorganization of the Company, any reclassification of the capital
      stock
      of the Company, any consolidation or merger of the Company with or into another
      corporation, or any conveyance of all or substantially all of the assets of
      the
      Company to another corporation, or

     

    C.  of
      any
      voluntary dissolution, liquidation or winding-up of the Company then, and in
      each such case, the Company will mail or cause to be mailed to each holder
      of a
      Warrant at the time outstanding a notice specifying, as the case may be,
      (a) the date on which a record is to be or has been taken for the purpose
      of such dividend, distribution or right, and stating the amount and character
      of
      such dividend, distribution or right, or (b) the date on which such
      reorganization, reclassification, consolidation, merger, conveyance,
      dissolution, liquidation or winding-up is expected to take place (the
“Payment
      Date”),
      and
      the time, if any is to be fixed, as of which the holders of record of Common
      Stock (or such stock or securities at the time receivable upon the exercise
      of
      the Warrants) shall be entitled to exchange their shares of Common Stock (or
      such other stock or securities) for securities or other property deliverable
      upon such reorganization, reclassification, consolidation, merger, conveyance,
      dissolution, liquidation or winding-up, such notice shall be mailed at least
      ten
      (10) days prior to the Payment Date therein specified.

     

    
      
        
        

      

      
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    6.  Loss
      or Mutilation.
      Upon
      receipt by the Company of evidence satisfactory to it (in the exercise of
      reasonable discretion) of the ownership of and the loss, theft, destruction
      or
      mutilation of any Warrant and (in the case of loss, theft or destruction) of
      indemnity and bond satisfactory to it (in the exercise of reasonable
      discretion), and (in the case of mutilation) upon surrender and cancellation
      thereof, the Company will execute and deliver in lieu thereof a new Warrant
      of
      like tenor.

     

    7.  Reservation
      of Common Stock.
      The
      Company shall at all times reserve and keep available for issue upon the
      exercise of Warrants such number of its authorized but unissued shares of Common
      Stock as will be sufficient to permit the exercise in full of this Warrant.
      All
      of the shares of Commons Stock issuable upon the proper exercise of the rights
      represented by this Warrant will, upon issuance and receipt of the Purchase
      Price therefor, be fully paid and nonassessable, and free from all contractual
      preemptive rights, rights of first refusal or first offer, taxes, liens and
      charges of whatever nature, with respect to the issuance thereof. If at any
      time
      the number of authorized but unissued shares of Common Stock shall not be
      sufficient for such purposes, the Company will take such corporate action as
      may, in the opinion of its counsel, be necessary to increase its authorized
      but
      unissued shares of Common Stock to such number of shares as shall be sufficient
      for such purpose and the obligation to issue such shares shall be suspended
      until such action has been taken.

     

    8.  Registration
      Rights.
      The
      Holder of this Warrant is entitled to have the Warrant Shares registered for
      resale under the Securities Act of 1933, as amended (the “Act”),
      pursuant to and in accordance with the Registration Rights Agreement among
      the
      Company, the Holder and the other investors who were issued Warrants in
      connection with the Offering.

     

    9.  No
      Rights as Stockholder Conferred by Warrants.
      The
      Warrant shall not entitle the Holder hereof to any of the rights, either at
      law
      or in equity, of a stockholder of the Company. The Holder shall, upon the
      exercise thereof, not be entitled to any dividend that may have accrued or
      which
      may previously have been paid with respect to shares of stock issuable upon
      the
      exercise of the Warrant, except as may otherwise be provided in Section 5
      hereof.

     

    10.  Endorsement
      of Warrants.
      The
      Warrant when presented or surrendered for exchange, transfer or registration
      shall be accompanied (if so required by the Company) by an assignment in the
      form attached hereto as Exhibit B
      or such
      other written instrument of transfer, in form satisfactory to the Company,
      duly
      executed by the registered Holder or by his duly authorized
      attorney.

     

    11.  Agreement
      of Warrant Holders.
      The
      Holder, and to the extent that portions of this Warrant are assigned and there
      is more than one Holder of warrants exercisable for the Warrant Shares, every
      holder of a Warrant, by accepting the same, consents and agrees with the Company
      and with all other Warrant holders that: (a) the Warrants are transferable
      only as permitted by Section 4
      above;
      (b) the Warrants are transferable only on the registry books of the Company
      as herein provided; and (c) the Company may deem and treat the person in
      whose name the Warrant certificate is registered as the absolute owner thereof
      and of the Warrants evidenced thereby for all purposes whatsoever, and the
      Company shall not be affected by any notice to the contrary. 

     

    12.  Payment
      of Taxes.
      The
      Company will pay all stamp, transfer and other similar taxes payable in
      connection with the original issuance of this Warrant and the shares of Common
      Stock issuable upon exercise thereof, provided, however, that the Company shall
      not be required to (i) pay any such tax which may be payable in respect of
      any transfer involving the transfer and delivery of this Warrant or the issuance
      or delivery of certificates for shares of Common Stock issuable upon exercise
      thereof in a name other than that of the registered Holder of this Warrant
      or
      (ii) issue or deliver any certificate for shares of Common Stock upon the
      exercise of this Warrant until any such tax required to be paid under clause
      (i) shall have been paid, all such tax being payable by the holder of this
      Warrant at the time of surrender.

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    13.  Fractional
      Interest.
      The
      Company shall not be required to issue fractional shares of Common Stock on
      the
      exercise of this Warrant. If more than one Warrant shall be presented for
      exercise at the same time by the Holder, the number of full shares of Common
      Stock which shall be issuable upon such exercise shall be computed on the basis
      of the aggregate number of shares of Common Stock acquirable on exercise of
      the
      Warrants so presented. If any fraction of a share of Common Stock would, except
      for the provisions of this Section 13,
      be
      issuable on the exercise of any Warrant (or specified portion thereof), the
      Company shall pay an amount in cash calculated by it to be equal to the Purchase
      Price per share multiplied by such fraction computed to the nearest whole cent.
      The Holder by his acceptance of this Warrant expressly waives any and all rights
      to receive any fraction of a share of Common Stock or a stock certificate
      representing a fraction of a share of Common Stock.

     

    14.  Entire
      Agreement.
      This
      Warrant constitutes the full and entire understanding and agreement among the
      parties with regard to the subject matter hereof and no party shall be liable
      or
      bound to any other party in any manner by any representations, warranties,
      covenants or agreements except as specifically set forth herein.

     

    15.  Successors
      and Assigns.
      All
      covenants and provisions of this Warrant by or for the benefit of the Company
      or
      the Holder of this Warrant shall bind and inure to the benefit of their
      respective successors, permitted assigns, heirs and personal
      representatives.

     

    16.  Termination.
      This
      Warrant shall terminate at 5:00 p.m., Eastern Time, on the Expiration Date
      or
      upon such earlier date on which all of this Warrant has been exercised (the
      “Termination
      Date”).

     

    17.  Notices.
      All
      notices and other communications from the Company to the Holder of this Warrant
      shall be deemed delivered if mailed by first class, registered or certified
      mail, postage prepaid, to the address furnished to the Company in writing by
      the
      Holder. All notices from the Holder of this Warrant to the Company shall be
      made
      in writing by the Holder to the Company at its Principal Office and shall be
      deemed delivered upon receipt.

     

    18.  Change;
      Modifications; Waiver.
      No
      terms of this Warrant may be amended, waived or modified except by the express
      written consent of the Company and the Holder.

     

    19.  Headings.
      The
      headings in this Warrant are for purposes of convenience in reference only,
      and
      shall not be deemed to constitute a part hereof.

     

    20.  Governing
      Law, Etc.
      This
      Warrant shall be governed by and construed in accordance with the internal
      laws
      of the State of New York without regard to the conflicts of laws principles
      thereof. The parties hereto hereby irrevocably agree that any suit or proceeding
      arising directly and/or indirectly pursuant to or under this Warrant, shall
      be
      brought solely in a federal or state court located in the City, County and
      State
      of New York. By its execution hereof, the parties hereby covenant and
      irrevocably submit to the in personam
      jurisdiction of the federal and state courts located in the City, County and
      State of New York and agree that any process in any such action may be served
      upon any of them personally, or by certified mail or registered mail upon them
      or their agent, return receipt requested, with the same full force and effect
      as
      if personally served upon them in New York City. The parties hereto waive any
      claim that any such jurisdiction is not a convenient forum for any such suit
      or
      proceeding and any defense or lack of in personam
      jurisdiction with respect thereto. In the event of any such action or
      proceeding, the party prevailing therein shall be entitled to payment from
      the
      other party hereto of all of its reasonable and documented legal fees and
      expenses.

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    WARRANT
      SIGNATURE PAGE

     

    
      	Dated:
              August __, 2007 	 	 
	 	 
	 	WHERIFY
              WIRELESS, INC.
	 
 	 
 	 
 
	 	By:  	 
	 	
              

              Name:
                 Vincent
                Sheeran

              Title:
                 Chief
                Executive Officer

            

    

     

     

    Warrant
      #BW-2

    Issued
      to
      Laidlaw & Company (UK) Ltd.

    For
      3,000,000 Shares

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

    EXHIBIT
      A

     

    SUBSCRIPTION
      FORM

     

    (To
      be
      executed only upon exercise of Warrant)

     

    The
      undersigned registered owner of this Warrant irrevocably exercises this Warrant
      and purchases _______ shares of the Common Stock of Wherify Wireless, Inc.,
      purchasable with this Warrant, and herewith makes payment therefor, all at
      the
      price and on the terms and conditions specified in this Warrant.

     

    
      	Dated:  ________________________	 	 
	 
 	 
 	 
 
	 	 	 
	 	
              
(Signature
              of Registered Owner)
	 	 
	 	
              
(Street
              Address)  
	 	 
	 	
              
(City
              / State / Zip
              Code)  

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    EXHIBIT
      B

     

    FORM
      OF ASSIGNMENT

     

    FOR
      VALUE RECEIVED
      the
      undersigned registered owner of this Warrant hereby sells, assigns and transfers
      unto the Assignee named below all of the rights of the undersigned under the
      within Warrant, with respect to the number of shares of Common Stock set forth
      below:

     

    
      	
              Name
                of Assignee

            	 	
              Address

            	 	
              Number
                of Shares

            
	 	 	 	 	 

    

     

    and
      does
      hereby irrevocably constitute and appoint __________________________ Attorney
      to
      make such transfer on the books of Wherify Wireless Inc., maintained for the
      purpose, with full power of substitution in the premises.

    
       

      
        	Dated:  ________________________	 	 
	 
 	 
 	 
 
	 	 	 
	 	
                
(Signature)
	 	 
	 	
                
(Witness) 

      

    

     

    The
      undersigned Assignee of the Warrant hereby makes to Wherify Wireless, Inc.,
      as
      of the date hereof, with respect to the Assignee, all of the representations
      and
      warranties made by the Holder, and the undersigned Assignee agrees to be bound
      by all the terms and conditions of the Warrant and Wherify Wireless, Inc.
      Registration Rights Agreement, dated the date of this Warrant, by and between
      Wherify Wireless, Inc. and the Holder. 

    
       

      
        	Dated:  ________________________	 	 
	 
 	 
 	 
 
	 	 	 
	 	
                
(Signature)Wherify
          Wireless, Inc.

        901
          Mariners Island Blvd, Suite 300

        San
          Mateo,
          CA 94404-1592

        Tel
          650.524.3000

        Fax
          650.524.3099

        www.wherifywireless.com

      

    

    

    June
      6,
      2007

    

     

    Dear
      Vince,

     

    The
      Board
      of Directors would like to offer you the Chief Executive Officer position of
      Wherify Wireless, Inc (the “Company”). The CEO employment terms are as follows:

     

    	·  	
            CEO
              role and responsibilities reporting to the Board (the
              “Executive”);

          

     

    	·  	
            Contract
              term of four (4) years. Company must provide Executive 90 day written
              notice if Company plans to not renew the
              contract;

          

     

    	·  	
            Salary
              is $200,000 per year;

          

     

    	·  	
            Option
              Package - 4,000,000. Options vest over 4 years, 1/48th
              per month. Stock options will be priced at the closing stock price
              on the
              date of the grant which is June 6, 2007;

          

     

    	·  	
            Company
              will provide Executive $2,000 per month for living expenses starting
              July
              1, 2007;

          

     

    	·  	
            Executive
              will be entitled to all Company benefits including medical, dental,
              401K
              plan, etc;

          

     

    	·  	
            Executive
              has the option to earn 100% of salary as a bonus annually. Company
              and
              Executive will identify 6-8 key milestones for the bonus. These milestones
              will be agreed to between Company and Executive and documented within
              30
              days of employment. The Company has full discretion to pay up to 50%
              of
              any bonus in registered stock;

          

     

    	·  	
            Executive’s
              compensation will be reviewed and adjusted annually based on
              performance;

          

     

    	·  	
            If
              termination for no cause or good reason, Executive has 1 year severance
              payable in either (i) a lump sum with no continued benefits or stock
              vesting or (ii) a 12 month payout of annual salary, benefits, and
              continued vesting of stock options. All vested options must be exercised
              within 90 days after termination or
              resignation;

          

     

    	·  	
            If
              termination for cause, no severance, no benefits, no continued stock
              option vesting;

          

     

    	·  	
            Upon
              change of control, all stock options immediately
              vest;

          

     

    	·  	
            One
              (1) seat on the Board.

          

     

    The
      target Executive start date is June 4th,
      2007.

     

    
      
         

      

      
        
          Strictly
            Confidential                                        
Page:
            1

        

        
          

        

      

      
         

      

    

    The
      Company and Executive agree that upon execution of signatures below, these
      terms
      are legally binding by both parties. In addition, the Company will formally
      document the legal agreement within the next 5 to 7 business days.

     

    I
      hereby
      agree to the above terms and accept the position as CEO of Wherify Wireless,
      Inc.

     

    

     

    
      	 	 	 	 	 
	 	Vince Sheeran, Executive	 	Date	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	Doug Hajjar, Board Member	 	Date	 
	 	 	 	 	 
	 	 	 	 	 
	 	Wade Fenn, Board Member,	 	Date	 
	 	Chairman Compensation Committee	 	 	 

    

     

     

    
      
         

      

      
        
          Strictly
            Confidential                                        
Page:
            2

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