Document:

Exhibit 4.1

 

Exhibit A

 

THIS SECURITY HAS NOT BEEN REGISTERED
WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION
NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. THIS
SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT WITH A REGISTERED BROKER-DEALER OR OTHER LOAN WITH A FINANCIAL
INSTITUTION THAT IS AN “ACCREDITED INVESTOR” AS DEFINED IN RULE 501(a) UNDER THE SECURITIES ACT OR OTHER LOAN SECURED
BY SUCH SECURITIES.

 

COMMON STOCK PURCHASE WARRANT

 

22ND
CENTURY GROUP, inc.

 

	Warrant Shares: [                 ]	Initial Exercise Date: December [    ], 2017
	 	Issue Date: June [    ], 2017

 

THIS COMMON STOCK PURCHASE
WARRANT (the “Warrant”) certifies that, for value received, [     ] or its assigns
(the “Holder”) is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter
set forth, at any time on or after December [     ], 2017 (the “Initial Exercise Date”)
and on or prior to the close of business on December [     ], 2022 (the “Termination Date”)
but not thereafter, to subscribe for and purchase from 22nd Century Group, Inc., a Nevada corporation (the “Company”),
up to [     ] shares (as subject to adjustment hereunder, the “Warrant Shares”) of
Common Stock. The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price, as defined
in Section 2(b).

 

Section 1.         Definitions.
Capitalized terms used and not otherwise defined herein shall have the meanings set forth in that certain Warrant Exercise Agreement
(the “Exercise Agreement”), dated as of June 19, 2017, among the Company and the holders signatory thereto.

 

Section 2.         Exercise.

 

a)       Exercise
of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times on or after the Initial
Exercise Date and on or before the Termination Date by delivery to the Company (or such other office or agency of the Company as
it may designate by notice in writing to the registered Holder at the address of the Holder appearing on the books of the Company)
of a duly executed facsimile copy (or e-mail attachment) of the Notice of Exercise in the form annexed hereto. Within two (2) Trading
Days following the date of exercise as aforesaid, the Holder shall deliver the aggregate Exercise Price for the shares specified
in the applicable Notice of Exercise by wire transfer or cashier’s check drawn on a United States bank unless the cashless
exercise procedure specified in Section 2(c) below is specified in the applicable Notice of Exercise. No ink-original Notice of
Exercise shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of Exercise
form be required. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this
Warrant to the Company until the Holder has purchased all of the Warrant Shares available hereunder and the Warrant has been exercised
in full, in which case, the Holder shall surrender this Warrant to the Company for cancellation within two (2) Trading Days of
the date the final Notice of Exercise is delivered to the Company. Partial exercises of this Warrant resulting in purchases of
a portion of the total number of Warrant Shares available hereunder shall have the effect of lowering the outstanding number of
Warrant Shares purchasable hereunder in an amount equal to the applicable number of Warrant Shares purchased. The Holder and the
Company shall maintain records showing the number of Warrant Shares purchased and the date of such purchases. The Company shall
deliver any objection to any Notice of Exercise within one (1) Business Day of receipt of such notice. The Holder and any assignee,
by acceptance of this Warrant, acknowledge and agree that, by reason of the provisions of this paragraph, following the purchase
of a portion of the Warrant Shares hereunder, the number of Warrant Shares available for purchase hereunder at any given time may
be less than the amount stated on the face hereof.

 

    	 	1	 

     

    

 

b)       Exercise
Price. The exercise price per share of the Common Stock under this Warrant shall be $2.15, subject to adjustment hereunder
(the “Exercise Price”).

 

c)       Cashless
Exercise. If at the time of exercise hereof there is no effective registration statement registering, or the prospectus contained
therein is not available for the issuance of the Warrant Shares to the Holder, then this Warrant may also be exercised, in whole
or in part, at such time by means of a “cashless exercise” in which the Holder shall be entitled to receive a number
of Warrant Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:

 

		(A) = 	the last VWAP immediately preceding the time of delivery
of the Notice of Exercise giving rise to the applicable “cashless exercise,” as set forth in the applicable Notice
of Exercise (to clarify, the "last VWAP" will be the last VWAP as calculated over an entire Trading Day such that, in
the event that this Warrant is exercised at a time that the Trading Market is open, the prior Trading Day's VWAP shall be used
in this calculation);

 

		(B) =  	the Exercise Price of this Warrant, as adjusted hereunder;
and

 

		(X) = 	the number of Warrant Shares that would be issuable upon
exercise of this Warrant in accordance with the terms of this Warrant if such exercise were by means of a cash exercise rather
than a cashless exercise.

 

If
Warrant Shares are issued in such a cashless exercise, the parties acknowledge and agree that in accordance with Section 3(a)(9)
of the Securities Act, the Warrant Shares shall take on the registered characteristics of the Warrants being exercised, and the
holding period of the Warrants being exercised may be tacked on to the holding period of the Warrant Shares.  The Company
agrees not to take any position contrary to this Section 2(c).

 

    	 	2	 

     

    

 

“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then listed
or quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest preceding
date) on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based on a Trading
Day from 9:30 a.m. (New York City time) to 4:00 p.m. (New York City time)), (b)  if OTCQB or OTCQX is not a Trading Market,
the volume weighted average price of the Common Stock for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable,
(c) if the Common Stock is not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Common Stock are then
reported in the “Pink Sheets” published by OTC Markets, Inc. (or a similar organization or agency succeeding to its
functions of reporting prices), the most recent bid price per share of the Common Stock so reported, or (d) in all other cases,
the fair market value of a share of Common Stock as determined by an independent appraiser selected in good faith by the Purchasers
of a majority in interest of the Securities then outstanding and reasonably acceptable to the Company, the fees and expenses of
which shall be paid by the Company.

 

d)           Mechanics
of Exercise.

 

i.       Delivery
of Warrant Shares Upon Exercise. The Company shall cause the Warrant Shares purchased hereunder to be transmitted by the Transfer
Agent to the Holder by crediting the account of the Holder’s or its designee’s balance account with The Depository
Trust Company through its Deposit or Withdrawal at Custodian system (“DWAC”) if the Company is then a participant
in such system and either (A) there is an effective registration statement permitting the issuance of the Warrant Shares to or
resale of the Warrant Shares by Holder or (B) this Warrant is being exercised via “cashless exercise”, and otherwise
by physical delivery of a certificate, registered in the Company’s share register in the name of the Holder or its designee,
for the number of Warrant Shares to which the Holder is entitled pursuant to such exercise to the address specified by the Holder
in the Notice of Exercise by the date that is two (2) Trading Days after the delivery to the Company of the Notice of Exercise
(such date, the “Warrant Share Delivery Date”). The Warrant Shares shall be deemed to have been issued, and
Holder or any other person so designated to be named therein shall be deemed to have become a holder of record of such shares for
all purposes, as of the date the Warrant has been exercised, with payment to the Company of the Exercise Price (or by cashless
exercise, if permitted) and all taxes required to be paid by the Holder, if any, pursuant to Section 2(d)(vi) prior to the issuance
of such shares, having been paid.

 

ii.       Delivery
of New Warrants Upon Exercise. If this Warrant shall have been exercised in part, the Company shall, at the request of a Holder
and upon surrender of this Warrant certificate, at the time of delivery of the Warrant Shares, deliver to the Holder a new Warrant
evidencing the rights of the Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant shall
in all other respects be identical with this Warrant.

 

    	 	3	 

     

    

 

iii.       Rescission
Rights. If the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares pursuant to Section 2(d)(i)
by the Warrant Share Delivery Date, then the Holder will have the right to rescind such exercise.

 

iv.       Compensation
for Buy-In on Failure to Timely Deliver Warrant Shares Upon Exercise. In addition to any other rights available to the Holder,
if the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares in accordance with the provisions
of Section 2(d)(i) above pursuant to an exercise on or before the Warrant Share Delivery Date, and if after such date the Holder
is required by its broker to purchase (in an open market transaction or otherwise) or the Holder’s brokerage firm otherwise
purchases, shares of Common Stock to deliver in satisfaction of a sale by the Holder of the Warrant Shares which the Holder anticipated
receiving upon such exercise (a “Buy-In”), then the Company shall (A) pay in cash to the Holder the amount,
if any, by which (x) the Holder’s total purchase price (including brokerage commissions, if any) for the shares of Common
Stock so purchased exceeds (y) the amount obtained by multiplying (1) the number of Warrant Shares that the Company was required
to deliver to the Holder in connection with the exercise at issue times (2) the price at which the sell order giving rise to such
purchase obligation was executed, and (B) at the option of the Holder, either reinstate the portion of the Warrant and equivalent
number of Warrant Shares for which such exercise was not honored (in which case such exercise shall be deemed rescinded) or deliver
to the Holder the number of shares of Common Stock that would have been issued had the Company timely complied with its exercise
and delivery obligations hereunder. For example, if the Holder purchases Common Stock having a total purchase price of $11,000
to cover a Buy-In with respect to an attempted exercise of shares of Common Stock with an aggregate sale price giving rise to such
purchase obligation of $10,000, under clause (A) of the immediately preceding sentence the Company shall be required to pay the
Holder $1,000. The Holder shall provide the Company written notice indicating the amounts payable to the Holder in respect of the
Buy-In and, upon request of the Company, evidence of the amount of such loss. Nothing herein shall limit a Holder’s right
to pursue any other remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific
performance and/or injunctive relief with respect to the Company’s failure to timely deliver shares of Common Stock upon
exercise of the Warrant as required pursuant to the terms hereof.

 

    	 	4	 

     

    

 

v.       No
Fractional Shares or Scrip. No fractional shares or scrip representing fractional shares shall be issued upon the exercise
of this Warrant. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such exercise, the
Company shall, pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the Exercise
Price.

 

vi.       Charges,
Taxes and Expenses. Issuance of Warrant Shares shall be made without charge to the Holder for any issue or transfer tax or
other incidental expense in respect of the issuance of such Warrant Shares, all of which taxes and expenses shall be paid by the
Company, and such Warrant Shares shall be issued in the name of the Holder or in such name or names as may be directed by the Holder;
provided, however, that in the event Warrant Shares are to be issued in a name other than the name of the Holder,
this Warrant when surrendered for exercise shall be accompanied by the Assignment Form attached hereto duly executed by the Holder
and the Company may require, as a condition thereto, the payment of a sum sufficient to reimburse it for any transfer tax incidental
thereto. The Company shall pay all Transfer Agent fees required for same-day processing of any Notice of Exercise and all fees
to the Depository Trust Company (or another established clearing corporation performing similar functions) required for same-day
electronic delivery of the Warrant Shares.

 

vii.       Closing
of Books. The Company will not close its stockholder books or records in any manner which prevents the timely exercise of this
Warrant, pursuant to the terms hereof.

 

    	 	5	 

     

    

 

e)       Holder’s
Exercise Limitations. The Company shall not effect any exercise of this Warrant, and a Holder shall not have the right to exercise
any portion of this Warrant, pursuant to Section 2 or otherwise, to the extent that after giving effect to such issuance after
exercise as set forth on the applicable Notice of Exercise, the Holder (together with the Holder’s Affiliates, and any other
Persons acting as a group together with the Holder or any of the Holder’s Affiliates (such Persons, "Attribution
Parties")), would beneficially own in excess of the Beneficial Ownership Limitation (as defined below).  For purposes
of the foregoing sentence, the number of shares of Common Stock beneficially owned by the Holder and its Affiliates and Attribution
Parties shall include the number of shares of Common Stock issuable upon exercise of this Warrant with respect to which such determination
is being made, but shall exclude the number of shares of Common Stock which would be issuable upon (i) exercise of the remaining,
nonexercised portion of this Warrant beneficially owned by the Holder or any of its Affiliates or Attribution Parties and (ii)
exercise or conversion of the unexercised or nonconverted portion of any other securities of the Company (including, without limitation,
any other Common Stock Equivalents) subject to a limitation on conversion or exercise analogous to the limitation contained herein
beneficially owned by the Holder or any of its Affiliates or Attribution Parties.  Except as set forth in the preceding sentence,
for purposes of this Section 2(e), beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act
and the rules and regulations promulgated thereunder, it being acknowledged by the Holder that the Company is not representing
to the Holder that such calculation is in compliance with Section 13(d) of the Exchange Act and the Holder is solely responsible
for any schedules required to be filed in accordance therewith. To the extent that the limitation contained in this Section 2(e)
applies, the determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together
with any Affiliates and Attribution Parties) and of which portion of this Warrant is exercisable shall be in the sole discretion
of the Holder, and the submission of a Notice of Exercise shall be deemed to be the Holder’s determination of whether this
Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates and Attribution Parties)
and of which portion of this Warrant is exercisable, in each case subject to the Beneficial Ownership Limitation, and the Company
shall have no obligation to verify or confirm the accuracy of such determination. In addition, a determination as to any group
status as contemplated above shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations
promulgated thereunder. For purposes of this Section 2(e), in determining the number of outstanding shares of Common Stock, a Holder
may rely on the number of outstanding shares of Common Stock as reflected in (A) the Company’s most recent periodic or annual
report filed with the Commission, as the case may be, (B) a more recent public announcement by the Company or (C) a more recent
written notice by the Company or the Transfer Agent setting forth the number of shares of Common Stock outstanding.  Upon
the written or oral request of a Holder, the Company shall within two Trading Days 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, including this Warrant, by the Holder
or its Affiliates or Attribution Parties since the date as of which such number of outstanding shares of Common Stock was reported.
The “Beneficial Ownership Limitation” shall be 4.99% of the number of shares of the Common Stock outstanding
immediately after giving effect to the issuance of shares of Common Stock issuable upon exercise of this Warrant. The Holder, upon
notice to the Company, may increase or decrease the Beneficial Ownership Limitation provisions of this Section 2(e), provided that
the Beneficial Ownership Limitation in no event exceeds 9.99% of the number of shares of the Common Stock outstanding immediately
after giving effect to the issuance of shares of Common Stock upon exercise of this Warrant held by the Holder and the provisions
of this Section 2(e) shall continue to apply. Any increase in the Beneficial Ownership Limitation will not be effective until the
61st day after such notice is delivered to the Company and shall only be effective with regard to such Holder. The provisions
of this Section 2(e) shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this
Section 2(e) 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. The limitations contained in this Section 2(e) shall apply to a successor holder of this Warrant.

 

    	 	6	 

     

    

 

Section 3.         Certain
Adjustments.

 

a)       Stock
Dividends and Splits. If the Company, at any time while this Warrant is outstanding: (i) pays a stock dividend or otherwise
makes a distribution or distributions on shares of its Common Stock or any other equity or equity equivalent securities payable
in shares of Common Stock (which, for avoidance of doubt, shall not include any shares of Common Stock issued by the Company upon
exercise of this Warrant), (ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines (including
by way of reverse stock split) outstanding shares of Common Stock into a smaller number of shares, or (iv) issues by reclassification
of shares of the Common Stock any shares of capital stock of the Company, then in each case the Exercise Price shall be multiplied
by a fraction of which the numerator shall be the number of shares of Common Stock (excluding treasury shares, if any) outstanding
immediately before such event and of which the denominator shall be the number of shares of Common Stock outstanding immediately
after such event, and the number of shares issuable upon exercise of this Warrant shall be proportionately adjusted such that the
aggregate Exercise Price of this Warrant shall remain unchanged. Any adjustment made pursuant to this Section 3(a) shall become
effective immediately after the record date for the determination of stockholders entitled to receive such dividend or distribution
and shall become effective immediately after the effective date in the case of a subdivision, combination or re-classification.

 

b)       [RESERVED]

 

c)       [RESERVED]

 

d)       Pro
Rata Distributions. During such time as this Warrant is outstanding, 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, the Holder shall be entitled to participate in such Distribution
to the same extent that the Holder would have participated therein 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 exercise hereof, including without limitation,
the Beneficial Ownership Limitation) immediately before the date of which a record is taken for such Distribution, 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 participation in
such Distribution (provided, however, to the extent that the Holder's right to participate in any such Distribution
would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate
in such Distribution to such extent (or in the beneficial ownership of any shares of Common Stock as a result of such Distribution
to such extent) and the portion of such Distribution shall be held in abeyance for the benefit of the Holder until such time, if
ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation).

 

    	 	7	 

     

    

 

e)       Extraordinary
Transaction. If, (i) the Company effects any merger or consolidation of the Company with or into another Person, (ii) the Company
effects any sale of all or substantially all of its assets in one or a series of related transactions, (iii) any tender offer or
exchange offer by the Company is completed pursuant to which holders of Common Stock are permitted to tender or exchange their
shares for other securities, cash or property, or (iv) the Company effects any reclassification of the Common Stock or any compulsory
share exchange pursuant to which the Common Stock is effectively converted into or exchanged for other securities, cash or property
(in any such case, an “Extraordinary Transaction”), then this Warrant will become the right thereafter to receive,
upon exercise, the same amount and kind of securities, cash or property as the Holder would have been entitled to receive upon
the occurrence of such Extraordinary Transaction if it had been, immediately prior to such Extraordinary Transaction, the holder
of the number of Warrant Shares then issuable upon exercise in full of the relevant Warrant (the “Alternate Consideration”)
in lieu of Common Stock. The aggregate Exercise Price for each Warrant will not be affected by any such Extraordinary Transaction,
but the Company shall apportion such aggregate Exercise Price among the Alternate Consideration in a reasonable manner reflecting
the relative value of any different components of the Alternate Consideration. If holders of Common Stock are given any choice
as to the securities, cash or property to be received in an Extraordinary Transaction, then the Holder, to the extent practicable,
shall be given the same choice as to the Alternate Consideration it receives upon any exercise of its Warrant following such Extraordinary
Transaction. In addition, at the request of the Holder, upon surrender of this Warrant, any successor to the Company or surviving
entity in such Extraordinary Transaction shall issue to such Holder a new warrant consistent with the foregoing provisions and
evidencing the Holder’s right to purchase the Alternate Consideration for the aggregate Exercise Price upon exercise thereof.
Each such new warrant (or any such replacement security) will be similarly adjusted upon any subsequent transaction analogous to
an Extraordinary Transaction.

 

f)       Calculations.
All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share, as the case may be.
For purposes of this Section 3, the number of shares of Common Stock deemed to be issued and outstanding as of a given date shall
be the sum of the number of shares of Common Stock (excluding treasury shares, if any) issued and outstanding.

 

g)       Notice
to Holder.

 

i.       Adjustment
to Exercise Price. Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the Company shall promptly
deliver to the Holder by facsimile or email a notice setting forth the Exercise Price after such adjustment and any resulting adjustment
to the number of Warrant Shares and setting forth a brief statement of the facts requiring such adjustment.

 

    	 	8	 

     

    

 

ii.       Notice
to Allow Exercise by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever form) on the
Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common Stock, (C) the
Company shall authorize the granting to all holders of the Common Stock rights or warrants to subscribe for or purchase any shares
of capital stock of any class or of any rights, (D) the approval of any stockholders of the Company shall be required in connection
with any reclassification of the Common Stock, any consolidation or merger to which the Company is a party, any sale or transfer
of all or substantially all of the assets of the Company, or any compulsory share exchange whereby the Common Stock is converted
into other securities, cash or property, or (E) the Company shall authorize the voluntary or involuntary dissolution, liquidation
or winding up of the affairs of the Company, then, in each case, the Company shall cause to be delivered by facsimile or email
to the Holder at its last facsimile number of email address as it shall appear upon the Warrant Register of the Company, (unless
such notice is filed with the Commission, which in such case, no additional notice is required to be provided to the Holder), at
least 10 calendar days prior to the applicable record or effective date hereinafter specified, a notice stating (x) the date on
which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants, or if a record is
not to be taken, the date as of which the holders of the Common Stock of record to be entitled to such dividend, distributions,
redemption, rights or warrants are to be determined or (y) the date on which such reclassification, consolidation, merger, sale,
transfer or share exchange is expected to become effective or close, and the date as of which it is expected that holders of the
Common Stock of record shall be entitled to exchange their shares of the Common Stock for securities, cash or other property deliverable
upon such reclassification, consolidation, merger, sale, transfer or share exchange; provided that the failure to deliver such
notice or any defect therein or in the delivery thereof shall not affect the validity of the corporate action required to be specified
in such notice. To the extent that any notice provided in this Warrant constitutes, or contains, material, non-public information
regarding the Company or any of the Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant
to a Current Report on Form 8-K. The Holder shall remain entitled to exercise this Warrant during the period commencing on the
date of such notice to the effective date of the event triggering such notice except as may otherwise be expressly set forth herein.

 

Section 4.         Transfer
of Warrant.

 

a)       Transferability.
This Warrant and all rights hereunder (including, without limitation, any registration rights) are transferable, in whole or in
part, upon surrender of this Warrant at the principal office of the Company or its designated agent, together with a written assignment
of this Warrant substantially in the form attached hereto duly executed by the Holder or its agent or attorney and funds sufficient
to pay any transfer taxes payable upon the making of such transfer. Upon such surrender and, if required, such payment, the Company
shall execute and deliver a new Warrant or Warrants in the name of the assignee or assignees, as applicable, and in the denomination
or denominations specified in such instrument of assignment, and shall issue to the assignor a new Warrant evidencing the portion
of this Warrant not so assigned, and this Warrant shall promptly be cancelled. Notwithstanding anything herein to the contrary,
the Holder shall not be required to physically surrender this Warrant to the Company unless the Holder has assigned this Warrant
in full, in which case, the Holder shall surrender this Warrant to the Company within two (2) Trading Days of the date the Holder
delivers an assignment form to the Company assigning this Warrant full. The Warrant, if properly assigned in accordance herewith,
may be exercised by a new holder for the purchase of Warrant Shares without having a new Warrant issued.

 

    	 	9	 

     

    

 

b)       New
Warrants. This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of the
Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by
the Holder or its agent or attorney. Subject to compliance with Section 4(a), as to any transfer which may be involved in such
division or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants
to be divided or combined in accordance with such notice. All Warrants issued on transfers or exchanges shall be dated the initial
issuance date of this Warrant and shall be identical with this Warrant except as to the number of Warrant Shares issuable pursuant
thereto.

 

c)       Warrant
Register. The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the “Warrant
Register”), in the name of the record Holder hereof from time to time. The Company may deem and treat the registered
Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder, and
for all other purposes, absent actual notice to the contrary.

 

Section 5.         Miscellaneous.

 

a)       No
Rights as Stockholder Until Exercise. Except as set forth Section 3, this Warrant does not entitle the Holder to any voting
rights, dividends or other rights as a stockholder of the Company prior to the exercise hereof as set forth in Section 2(d)(i).

 

b)       Loss,
Theft, Destruction or Mutilation of Warrant. The Company covenants that upon receipt by the Company of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any stock certificate relating to the Warrant
Shares, and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of
the Warrant, shall not include the posting of any bond), and upon surrender and cancellation of such Warrant or stock certificate,
if mutilated, the Company will make and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation,
in lieu of such Warrant or stock certificate.

 

c)       Saturdays,
Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required or
granted herein shall not be a Business Day, then, such action may be taken or such right may be exercised on the next succeeding
Business Day.

 

    	 	10	 

     

    

 

d)       Authorized
Shares.

 

The Company covenants
that, during the period the Warrant is outstanding, it will reserve from its authorized and unissued Common Stock a sufficient
number of shares to provide for the issuance of the Warrant Shares upon the exercise of any purchase rights under this Warrant.
The Company further covenants that its issuance of this Warrant shall constitute full authority to its officers who are charged
with the duty of executing stock certificates to execute and issue the necessary Warrant Shares upon the exercise of the purchase
rights under this Warrant. The Company will take all such reasonable action as may be necessary to assure that such Warrant Shares
may be issued as provided herein without violation of any applicable law or regulation, or of any requirements of the Trading Market
upon which the Common Stock may be listed. The Company covenants that all Warrant Shares which may be issued upon the exercise
of the purchase rights represented by this Warrant will, upon exercise of the purchase rights represented by this Warrant and payment
for such Warrant Shares in accordance herewith, be duly authorized, validly issued, fully paid and nonassessable and free from
all taxes, liens and charges created by the Company in respect of the issue thereof (other than taxes in respect of any transfer
occurring contemporaneously with such issue).

 

Except and
to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending
its certificate of incorporation or through any reorganization, transfer of assets, consolidation, merger, 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, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions
as may be necessary or appropriate to protect the rights of Holder as set forth in this Warrant against impairment. Without limiting
the generality of the foregoing, the Company will (i) not increase the par value of any Warrant Shares above the amount payable
therefor upon such exercise immediately prior to such increase in par value, (ii) take all such action as may be necessary or appropriate
in order that the Company may validly and legally issue fully paid and nonassessable Warrant Shares upon the exercise of this Warrant
and (iii) use commercially reasonable efforts to obtain all such authorizations, exemptions or consents from any public regulatory
body having jurisdiction thereof, as may be, necessary to enable the Company to perform its obligations under this Warrant.

 

Before taking
any action which would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the
Exercise Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary
from any public regulatory body or bodies having jurisdiction thereof.

 

e)       Jurisdiction.
All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be determined in accordance
with the provisions of the Exercise Agreement.

 

f)       Restrictions.
The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered, and the Holder does
not utilize cashless exercise, will have restrictions upon resale imposed by state and federal securities laws.

 

    	 	11	 

     

    

 

g)       Nonwaiver
and Expenses. No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall operate
as a waiver of such right or otherwise prejudice the Holder’s rights, powers or remedies. Without limiting any other provision
of this Warrant or the Exercise Agreement, if the Company willfully and knowingly fails to comply with any provision of this Warrant,
which results in any material damages to the Holder, the Company shall pay to the Holder such amounts as shall be sufficient to
cover any costs and expenses including, but not limited to, reasonable attorneys’ fees, including those of appellate proceedings,
incurred by the Holder in collecting any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies
hereunder.

 

h)      Notices.
Any notice, request or other document required or permitted to be given or delivered to the Holder by the Company shall be delivered
in accordance with the notice provisions of the Exercise Agreement.

 

i)       Limitation
of Liability. No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant to purchase
Warrant Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of the Holder
for the purchase price of any Common Stock or as a stockholder of the Company, whether such liability is asserted by the Company
or by creditors of the Company.

 

j)       Remedies.
The Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled
to specific performance of its rights under this Warrant. The Company agrees that monetary damages would not be adequate compensation
for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive and not to assert
the defense in any action for specific performance that a remedy at law would be adequate.

 

k)       Successors
and Assigns. Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall inure
to the benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted assigns
of Holder. The provisions of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant and
shall be enforceable by the Holder or holder of Warrant Shares.

 

l)       Amendment.
This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company and the Holder.

 

m)       Severability.
Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable
law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective
to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions
of this Warrant.

 

n)       Headings.
The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of
this Warrant.

 

********************

 

(Signature Page Follows)

 

 

    	 	12	 

     

    

 

IN WITNESS WHEREOF,
the Company has caused this Warrant to be executed by its officer thereunto duly authorized as of the date first above indicated.

 

	 	22ND CENTURY GROUP, INC.
	 	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:

 

    	 	13	 

     

    

 

NOTICE OF EXERCISE

 

		To:	22nd century group,
INC.

 

(1)   The
undersigned hereby elects to purchase ________ Warrant Shares of the Company pursuant to the terms of the attached Warrant (only
if exercised in full), and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes,
if any.

 

(2)   Payment
shall take the form of (check applicable box):

 

 ̈
in lawful money of the United States; or

 

 ̈
if permitted the cancellation of such number of Warrant Shares as is necessary, in accordance with the formula set forth in subsection
2(c), to exercise this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise
procedure set forth in subsection 2(c).

 

(3)   Please
issue said Warrant Shares in the name of the undersigned or in such other name as is specified below:

 

	 	 	 

 

The Warrant Shares shall be delivered to
the following DWAC Account Number:

 

	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 

 

[SIGNATURE
OF HOLDER]

 

Name of Investing Entity: ________________________________________________________________________

Signature of Authorized Signatory of Investing
Entity: _________________________________________________

Name of Authorized Signatory: ___________________________________________________________________

Title of Authorized Signatory: ____________________________________________________________________

Date: ________________________________________________________________________________________

 

     

     

    

 

ASSIGNMENT
FORM

 

(To assign the
foregoing Warrant, execute this form and supply required information. Do not use this form to purchase shares.)

 

FOR VALUE RECEIVED,
the foregoing Warrant and all rights evidenced thereby are hereby assigned to

 

	Name:	 	 
	 	 	(Please Print)
	 	 	 
	Address:	 	 
	 	 	(Please Print)
	Dated: _______________ __, ______	 	 
	 	 	 
	Holder’s Signature: _________________	 	 
	 	 	 
	Holder’s Address:  _________________Exhibit 10.1

 

WARRANT EXERCISE AGREEMENT

 

This Warrant Exercise
Agreement (this “Agreement”), dated as of June 19, 2017, is by and between 22nd Century Group, Inc. a Nevada
corporation (the “Company”), and the undersigned holder (the “Holder”) of warrants to purchase
shares of the Company’s common stock, par value $0.001 per share (the “Common Stock”).

 

WHEREAS, the Holder
beneficially owns in the aggregate the number of warrants to purchase Common Stock at an exercise price of $1.45 per share that
are exercisable until April 19, 2022, as set forth on the Holder's signature page hereto (the “October 2016 Warrants”)
and the number of warrants to purchase Common Stock at an exercise price of $1.00 per share that are exercisable until January
27, 2022, as set forth on the Holder's signature page hereto (the “July 2016 Warrants” and together with the
October 2016 Warrants, the “Original Warrants”).

 

WHEREAS, the Holder
desires to exercise such Original Warrants in the amounts set forth on the applicable signature pages hereto and, immediately prior
to such exercise and in consideration of the Holder’s exercise of such Original Warrants, the Company has agreed to issue
the Holder, in addition to the shares of Common Stock to which such exercising Holder is entitled pursuant to the exercise of the
Original Warrants, an equal number of new warrants as the number of Original Warrants being exercised in the form attached hereto
as Exhibit A (the “New Warrants”). The shares of Common Stock underlying the Original Warrants are referred
to herein as the “Warrant Shares”. The shares of Common Stock underlying the New Warrants are referred to herein
as the "New Warrant Shares" and collectively with the New Warrants and Warrant Shares, the "Securities".

 

NOW, THEREFORE, IN
CONSIDERATION of the mutual covenants contained in this Agreement, and for good and valuable consideration the receipt and adequacy
of which are hereby acknowledged, the Holder and the Company agree as follows:

 

ARTICLE I

DEFINITIONS

 

Section 1.1 Definitions. Capitalized
terms not defined in this Agreement shall have the meanings ascribed to such terms in the New Warrants.

 

ARTICLE II

EXERCISE OF ORIGINAL WARRANTS

 

Section 2.1 Exercise of Warrants.
(a) Subject to the conditions in Section 2(e) of each of the Original Warrants, by executing this Agreement, the Company and the
Holder hereby agree that the Holder shall be deemed to have exercised the number of Original Warrants set forth on the signature
page hereto at the current exercise price per share applicable with respect to such Original Warrants, for aggregate cash proceeds
to the Company in the amount set forth on the Holder’s signature page hereto, pursuant to the terms of the Original Warrants.
The Holder shall deliver the aggregate cash exercise price for such Original Warrants to the bank account set forth on the Company’s
signature page hereto within two Trading Days after the date hereof and the Company shall deliver the Warrant Shares to the Holder
via the Depository Trust Company Deposit or Withdrawal at Custodian system pursuant to the terms of the Original Warrants, but
pursuant to DWAC instructions set forth on the Holder’s signature page hereto. The date of the closing of the exercise of
the Original Warrants shall be referred to as the “Closing Date”. Notwithstanding anything to the contrary contained
herein, if the Holder has exercised all of its Original Warrants on the Closing Date, the provisions of clauses (b) and (c) of
this Section 2.1, and the last two sentences of Section 2.2, shall not apply to the Holder.

 

    	 	1	 

     

    

 

(b)           After the Closing Date, if and
whenever the Holder, together with its Attribution Parties (as defined in Section 2(e) of the Original Warrants), can exercise
Original Warrants for 2,000,000 Warrant Shares (the "Threshold Amount") or more in compliance with the Beneficial
Ownership Limitation, the Holder hereby covenants and agrees to promptly exercise for cash the Holder's Attribution Party Pro Rata
Percentage (as defined below) of such Threshold Amount of the Original Warrants held by it by delivery of a Notice of Exercise
pursuant to the terms and conditions of the applicable Original Warrants. The parties hereto further agree that the Holder may
voluntarily exercise for cash, from time to time, the Original Warrants pursuant to the terms and conditions of the applicable
Original Warrants, which exercises shall count toward the number of Original Warrants that are required to be exercised to satisfy
the Threshold Amount. With respect to any exercise, the Holder hereby agrees to exercise the Original Warrants, in each case in
pro-rata amounts based on the number of October 2016 Warrants and July 2016 Warrants held by the Holder at the time of any exercise
(e.g., if the Holder holds 2,500,000 October 2016 Warrants and 5,000,000 July 2016 Warrants, and the Holder is required to exercise,
or elects to exercise, 2,400,000 Original Warrants, the Holder shall exercise 800,000 October 2016 Warrants and 1,600,000 July
2016 Warrants). As used herein "Attribution Party Pro Rata Percentage" means the percentage calculated by dividing (i)
the total number of Original Warrants held by the Holder, by (ii) the total number of Original Warrants held by the Holder and
its Attribution Parties.

 

(c)           In addition to the foregoing, subject
to the Holder's ability to exercise Original Warrants in compliance with the Beneficial Ownership Limitations (as defined in and
as set forth in Section 2(e) of each of the Original Warrants held by the Holder), on August 21, 2017, the Holder agrees to exercise
for cash as many Original Warrants as it can exercise still be in compliance with the Beneficial Ownership Limitations contained
in the Original Warrants pursuant to the terms and conditions of the applicable Original Warrants. If any Original Warrants remain
unexercised after August 21, 2017, on the thirty day anniversary of such date, the Holder agrees to exercise for cash as many Original
Warrants as it can receive upon such exercise and still be in compliance with the Beneficial Ownership Limitations contained in
the Original Warrants pursuant to the terms and conditions of the applicable Original Warrants. Any exercises pursuant to this
clause (c) shall be done in accordance with the provisions set forth in the Original Warrants and consistent with the last two
sentences of clause (b) above. While any Original Warrants are held by the Holder, the Holder covenants and agrees not to purchase
any shares of Common Stock of the Company, other than pursuant to exercises of Original Warrants. During the term of this Agreement,
the Holder agrees not to transfer any of the Original Warrants other to transferees who assume the obligations under this Agreement.

 

Section 2.2 Issuance of New Warrants.
Within 3 Trading Days of the Closing Date, the Company shall deliver to the Holder the New Warrants to which the Holder is entitled.
The Holder shall be entitled to receive a New Warrant issuable for the identical number of shares of Common Stock as the Holder
exercises for cash pursuant to Section 2.1(a) above. Within 3 Trading Days of the exercise of any Original Warrants for cash prior
to October 1, 2017 (the “Termination Date”), whether such exercise is required under this Agreement, or is at the election
of the Holder, the Company shall deliver to the Holder one New Warrant issuable for the identical number of Original Warrants exercised.
The obligations under Section 2.1 shall terminate on the Termination Date.

 

Section 2.3 Legends; Restricted
Securities. (a) The Holder understands that the New Warrants and the shares of Common Stock underlying New Warrants are not,
and may never be, registered under the Securities Act of 1933, as amended (the “Securities Act”), or the securities
laws of any state and, accordingly, each certificate, if any, representing such securities shall bear a legend substantially similar
to the following:

 

    	 	2	 

     

    

 

“THIS
SECURITY HAS NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE
UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY,
MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE
EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH
APPLICABLE STATE SECURITIES LAWS. THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT WITH A REGISTERED
BROKER-DEALER OR OTHER LOAN WITH A FINANCIAL INSTITUTION THAT IS AN “ACCREDITED INVESTOR” AS DEFINED IN RULE 501(a)
UNDER THE SECURITIES ACT OR OTHER LOAN SECURED BY SUCH SECURITIES.”

 

(b)  Certificates evidencing shares of
Common Stock underlying the New Warrants shall not contain any legend (including the legend set forth in Section 2.3(a) hereof),
(i) while a registration statement covering the resale of such Common Stock is effective under the Securities Act, (ii) following
any sale of such Common Stock pursuant to Rule 144, (iii) if such Common Stock is eligible for sale under Rule 144, without the
requirement for the Company to be in compliance with the current public information required under Rule 144 as to such Common Stock
and without volume or manner-of-sale restrictions, (iv) if such Common Stock may be sold under Rule 144 and the Company is
then in compliance with the current public information required under Rule 144 as to such Common Stock, or (v) if such legend is
not required under applicable requirements of the Securities Act (including judicial interpretations and pronouncements issued
by the staff of the Securities and Exchange Commission (the “Commission”)). The Company shall cause its counsel
to issue a legal opinion to the transfer agent promptly after the Delegend Date (as defined below) if required by the Company and/or
the transfer agent to effect the removal of the legend hereunder, which opinion shall be in form and substance reasonably acceptable
to the Holder. If such Common Stock may be sold under Rule 144 without the requirement for the Company to be in compliance with
the current public information required under Rule 144 or if such legend is not otherwise required under applicable requirements
of the Securities Act (including judicial interpretations and pronouncements issued by the staff of the Commission) then such Common
Stock shall be issued free of all legends. The Company agrees that following the Delegend Date or at such time as such legend is
no longer required under this Section 2.3(b), it will, no later than two (2) Trading Days following the delivery by the Holder
to the Company or the transfer agent of a certificate representing the Common Stock underlying the New Warrants issued with a restrictive
legend (such second Trading Day, the “Legend Removal Date”), deliver or cause to be delivered to the Holder
a certificate representing such shares that is free from all restrictive and other legends or, at the request of the Holder shall
credit the account of the Holder’s prime broker with the Depository Trust Company System as directed by the Holder. The Company
may not make any notation on its records or give instructions to the transfer agent that enlarge the restrictions on transfer set
forth in this Section 2.3(b). “Delegend Date” means the earliest of the date that (a) a registration statement
with respect to the Common Stock has been declared effective by the Commission or (b) all of the Common Stock has been sold pursuant
to Rule 144 or may be sold pursuant to Rule 144 without the requirement for the Company to be in compliance with the current public
information required under Rule 144 and without volume or manner-of-sale restrictions or (c) following the six (6) month anniversary
of (I) the Closing Date if a New Warrant is exercised pursuant to a cashless exercise or (II) the date of the related cash exercise
of the New Warrants provided, in each case that the applicable holder of the New Warrants or the Common Stock, as the case may
be, is not an Affiliate of the Company, the Company is in compliance with the current public information required under Rule 144
(“Current Public Information Requirement”) and all such Common Stock may be sold pursuant to Rule 144 or an
exemption from registration under Section 4(a)(1) of the Securities Act without volume or manner-of-sale restrictions; provided,
further, however, that if the Company fails to comply with the Current Public Information Requirement at any time following the
applicable six (6) month anniversary set forth above and the one (1) year anniversary of the Closing Date, the Company shall promptly
provide notice to the Holder and the Holder undertakes not to sell such Common Stock pursuant to Rule 144 until the Company notifies
the Holder that it has regained compliance with the Current Public Information Requirement; and provided further, that if
a delegending is in effect solely as the result of the effectiveness of a registration statement covering the resale of any Common
Stock, the Holder undertakes not to sell any such Common Stock if the Holder is notified or otherwise becomes aware that such registration
statement has been withdrawn or suspended, contains a material misstatement or omission or has become stale. The Holder agrees
with the Company that the Holder will sell or transfer any New Warrants or shares of Common Stock underlying New Warrants pursuant
to either the registration requirements of the Securities Act, including any applicable prospectus delivery requirements, or an
exemption therefrom, and that if such securities are sold pursuant to a registration statement, they will be sold in compliance
with the plan of distribution set forth therein, and acknowledges that the removal of the restrictive legend from certificates
representing any such securities as set forth in this Section 2.3 or otherwise is predicated upon the Company’s reliance
upon this understanding.

 

    	 	3	 

     

    

 

Section 2.4 Filing of Form 8-K
and Amendment to Registration Statement. Prior to 9:00 am ET on June 19, 2017, the Company shall issue a Current Report on
Form 8-K, reasonably acceptable to the Holder disclosing the material terms of the transactions contemplated hereby, which shall
include this form of Agreement (the “8-K Filing”). From and after the issuance of the 8-K Filing, the Company
represents to the Holder that it shall not be in possession of any material, nonpublic information received from the Company, any
of its Subsidiaries or any of their respective officers, directors, employees or agents, that is not disclosed in the 8-K Filing.
In addition, effective upon the filing of the 8-K Filing, the Company acknowledges and agrees that any and all confidentiality
or similar obligations under any agreement, whether written or oral, between the Company, any of its Subsidiaries or any of their
respective officers, directors, employees or agents, on the one hand, and the Holder or any of its affiliates, on the other hand,
shall terminate. The Company shall not, and shall cause each of its Subsidiaries and its and each of their respective officers,
directors, employees and agents, not to, provide the Holder with any material, nonpublic information regarding the Company or any
of its Subsidiaries from and after the date hereof without the express prior written consent of the Holder. To the extent that
the Company, any of its Subsidiaries or any of their respective officers, directors, employees or agents, delivers any material,
non-public information to the Holder without the Holder’s consent, the Company hereby covenants and agrees that the Holder
shall not have any duty of confidentiality with respect to, or a duty not to trade on the basis of, such material, non-public information.

 

ARTICLE III

REPRESENTATIONS AND WARRANTIES

 

Section 3.1 Representations and
Warranties of the Company. The Company hereby makes the representations and warranties set forth below to the Holder that as
of the date of its execution of this Agreement:

 

    	 	4	 

     

    

 

(a) Authorization;
Enforcement. The Company has the requisite corporate power and authority to enter into and to consummate the transactions contemplated
by this Agreement and otherwise to carry out its obligations hereunder and thereunder. The execution and delivery of this Agreement
by the Company and the consummation by it of the transactions contemplated hereby have been duly authorized by all necessary action
on the part of such Company and no further action is required by such Company, its board of directors or its stockholders in connection
therewith. This Agreement has been duly executed by the Company and, when delivered in accordance with the terms hereof will constitute
the valid and binding obligation of the Company enforceable against the Company in accordance with its terms except (i) as
limited by general equitable principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general
application affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability
of specific performance, injunctive relief or other equitable remedies and (iii) insofar as indemnification and contribution
provisions may be limited by applicable law.

 

(b) Organization.
The Company is a duly organized and validly existing corporation in good standing under the laws of the State of Nevada.

 

(c) Registration
Statement. The Warrant Shares are registered for issuance on a Form S-3 Registration Statement and the Company knows of no
reasons why such registration statement shall not remain available for the issuance of such Warrant Shares for the foreseeable
future. The Company shall use commercially reasonable efforts to keep the Registration Statement effective and available for the
issuance of the Warrant Shares underlying the Original Warrants until all Original Warrants are exercised. If the Company is unable
to keep the Registration Statement effective and available despite their commercially reasonable efforts, either the Company or
the Holder may, by delivering written notice to the other, terminate all remaining obligations under this Agreement.

 

(d) No Conflicts.
The execution, delivery and performance of this Agreement by the Company and the consummation by the Company of the transactions
contemplated hereby do not and will not: (i) conflict with or violate any provision of the Company’s certificate or
articles of incorporation, bylaws or other organizational or charter documents, or (ii) conflict with, or constitute a default
(or an event that with notice or lapse of time or both would become a default) under, result in the creation of any lien upon any
of the properties or assets of the Company, or give to others any rights of termination, amendment, acceleration or cancellation
(with or without notice, lapse of time or both) of, any material agreement, credit facility, debt or other material instrument
(evidencing Company debt or otherwise) or other material understanding to which the Company is a party or by which any property
or asset of the Company is bound or affected, or (iii) conflict with or result in a violation of any law, rule, regulation,
order, judgment, injunction, decree or other restriction of any court or governmental authority to which the Company is subject
(including federal and state securities laws and regulations), or by which any property or asset of the Company is bound or affected.

 

(e) Disclosure.
Except with respect to the material terms and conditions of the transactions contemplated by this Agreement, the Company confirms
that neither it nor any other Person acting on its behalf has provided any of Holder or their agents or counsel with any information
that it believes constitutes or might constitute material, non-public information. The Company understands and confirms that the
Holder will rely on the foregoing representation in effecting transactions in securities of the Company. All of the disclosure
furnished by or on behalf of the Company to the Holder regarding the Company and its Subsidiaries, their respective businesses
and the transactions contemplated hereby, including but not limited to the disclosure set forth in the SEC Reports, is true and
correct and does not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make
the statements made therein, in light of the circumstances under which they were made, not misleading. As used herein, “SEC
Reports” means all reports, schedules, forms, statements and other documents required to be filed by the Company with
the Commission pursuant to the reporting requirements of the 1934 Act, including all exhibits included therein and financial statements,
notes and schedules thereto and documents incorporated by reference therein.

 

    	 	5	 

     

    

 

(f) Issuance of
Securities. The issuance of the New Warrants are duly authorized and, upon issuance in accordance with the terms of this Agreement,
the New Warrants shall be validly issued and free from all preemptive or similar rights (except for those which have been validly
waived prior to the date hereof), taxes, liens and charges and other encumbrances with respect to the issue thereof. As of the
Closing Date, a number of shares of Common Stock shall have been duly authorized and reserved for issuance which equals or exceeds
the maximum number of Warrant Shares issuable upon exercise of the New Warrants (without taking into account any limitations on
the exercise of the New Warrants set forth therein). Upon exercise of the New Warrants in accordance with the New Warrants, the
Warrant Shares when issued will be validly issued, fully paid and nonassessable and free from all preemptive or similar rights,
taxes, liens, charges and other encumbrances with respect to the issue thereof, with the holders being entitled to all rights accorded
to a holder of Common Stock. Assuming the accuracy of each of the representations and warranties set forth in Section 3.2 of this
Agreement, the offer and issuance by the Company of the New Warrants is exempt from registration under the 1933Act.

 

(g) No General Solicitation.
Neither the Company, nor any of its Subsidiaries or affiliates, nor any Person acting on its or their behalf, has engaged in any
form of general solicitation or general advertising (within the meaning of Regulation D) in connection with the offer or sale of
the New Warrants.

 

(h) No Integrated
Offering. None of the Company, its Subsidiaries or any of their affiliates, nor any Person acting on their behalf has, directly
or indirectly, made any offers or sales of any security or solicited any offers to buy any security, under circumstances that would
require registration of the issuance of any of the New Warrants or the shares of Common Stock underlying the New Warrants (collectively,
the “Securities”) under the 1933 Act, whether through integration with prior offerings or otherwise, or cause
this offering of the Securities to require approval of shareholders of the Company for purposes of the 1933 Act or any applicable
shareholder approval provisions, including, without limitation, under the rules and regulations of any exchange or automated quotation
system on which any of the securities of the Company are listed or designated for quotation. None of the Company, its Subsidiaries,
their affiliates nor any Person acting on their behalf will take any action or steps that would require registration of the issuance
of any of the Securities under the 1933 Act or cause the offering of any of the Securities to be integrated with other offerings
for purposes of any such applicable shareholder approval provisions.

 

(i) No Disqualification
Events. With respect to Securities to be offered and sold hereunder in reliance on Rule 506(b) under the 1933 Act ("Regulation
D Securities"), none of the Company, any of its predecessors, any affiliated issuer, any director, executive officer,
other officer of the Company participating in the offering hereunder, any beneficial owner of 20% or more of the Company's outstanding
voting equity securities, calculated on the basis of voting power, nor any promoter (as that term is defined in Rule 405 under
the 1933 Act) connected with the Company in any capacity at the time of sale (each, an "Issuer Covered Person"
and, together, "Issuer Covered Persons") is subject to any of the "Bad Actor" disqualifications described
in Rule 506(d)(1)(i) to (viii) under the 1933 Act (a "Disqualification Event"), except for a Disqualification
Event covered by Rule 506(d)(2) or (d)(3). The Company has exercised reasonable care to determine whether any Issuer Covered Person
is subject to a Disqualification Event. The Company has complied, to the extent applicable, with its disclosure obligations under
Rule 506(e), and has furnished to the Holder a copy of any disclosures provided thereunder.

 

Section 3.2 Representations and
Warranties of the Holder. The Holder hereby makes the representations and warranties set forth below to the Company that as
of the date of its execution of this Agreement.

 

(a) Due Authorization.
The Holder represents and warrants that (i) the execution and delivery of this Agreement by it and the consummation by it
of the transactions contemplated hereby have been duly authorized by all necessary action on its behalf and (ii) this Agreement
has been duly executed and delivered by the Holder and constitutes the valid and binding obligation of the Holder, enforceable
against it in accordance with its terms.

 

    	 	6	 

     

    

 

(b) No Conflicts.
The Holder represents and warrants that the execution, delivery and performance of this Agreement by the Holder and the consummation
by the Holder of the transactions contemplated hereby do not and will not: (i) conflict with or violate any provision of the
Holder’s organizational or charter documents, or (ii) conflict with or result in a violation of any agreement, law,
rule, regulation, order, judgment, injunction, decree or other restriction of any court or governmental authority which would interfere
with the ability of the Holder to perform its obligations under this Agreement.

 

(c) Access to Information.
The Holder acknowledges that it has had the opportunity to review this Agreement and the SEC Reports and has been afforded (i) the
opportunity to ask such questions as it has deemed necessary of, and to receive answers from, representatives of the Company concerning
the terms and conditions of the exercise of the Original Warrants and the merits and risks of investing in the Warrant Shares;
(ii) access to information about the Company and its financial condition, results of operations, business, properties, management
and prospects sufficient to enable it to evaluate its investment; and (iii) the opportunity to obtain such additional information
that the Company possesses or can acquire without unreasonable effort or expense that is necessary to make an informed investment
decision with respect to the investment. The Holder acknowledges and agrees that neither Chardan Capital Markets, LLC (the
“Advisor”) nor any Affiliate of the Advisor has provided the Holder with any information or advice with respect
to the Securities nor is such information or advice necessary or desired. Neither the Advisor nor any Affiliate has made or
makes any representation as to the Company or the quality of the securities issued and issuable hereunder and the Advisor and any
Affiliate may have acquired non-public information with respect to the Company which the Holder agrees need not be provided to
it. In connection with the issuance of the securities hereunder to the Holder, neither the Advisor nor any of its Affiliates
has acted as a financial advisor or fiduciary to the Holder.

 

(d) Holder Status.
The Holder represents and warrants that is an “accredited investor” as defined in Rule 501 under the Securities Act.

 

(e) Knowledge.
The Holder, either alone or together with its representatives, has such knowledge, sophistication and experience in business and
financial matters so as to be capable of evaluating the merits and risks of the prospective investment in the Warrant Shares, and
has so evaluated the merits and risks of such investment. The Holder is able to bear the economic risk of an investment in the
Warrant Shares and, at the present time, is able to afford a complete loss of such investment.

 

ARTICLE IV

MISCELLANEOUS

 

Section
4.1 [Intentionally Omitted].

 

Section 4.2 Subsequent Equity Sales.

 

(a)          From
the date hereof until the earlier of (i) 100 days after the Closing Date or (ii) the Trading Day following the date that the Common
Stock’s VWAP (as defined in the New Warrants) exceeds $2.35 (subject to adjustment for forward and reverse stock splits and
the like) for a period of 5 consecutive Trading Days, neither the Company nor any Subsidiary shall issue, enter into any agreement
to issue or announce the issuance or proposed issuance of any shares of Common Stock or Common Stock Equivalents. As used herein
“Common Stock Equivalents” means any securities of the Company or the Subsidiaries which would entitle the holder
thereof to acquire at any time Common Stock, including, without limitation, any debt, preferred stock, right, option, warrant or
other instrument that is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof
to receive, Common Stock.

 

    	 	7	 

     

    

 

(b)          From
the date hereof until the New Warrants are no longer outstanding, the Company shall be prohibited from effecting or entering into
an agreement to effect any issuance by the Company or any of its Subsidiaries of Common Stock or Common Stock Equivalents (or a
combination of units thereof) involving a Variable Rate Transaction. “Variable Rate Transaction” means a transaction
in which the Company (i) issues or sells any debt or equity securities that are convertible into, exchangeable or exercisable for,
or include the right to receive additional shares of Common Stock either (A) at a conversion price, exercise price or exchange
rate or other price that is based upon and/or varies with the trading prices of or quotations for the shares of Common Stock at
any time after the initial issuance of such debt or equity securities, or (B) with a conversion, exercise or exchange price that
is subject to being reset at some future date after the initial issuance of such debt or equity security or upon the occurrence
of specified or contingent events directly or indirectly related to the business of the Company or the market for the Common Stock
or (ii) enters into any agreement, including, but not limited to, an equity line of credit or at-the-market offering, whereby the
Company may issue securities at a future determined price (other than standard and customary “preemptive” or “participation”
rights, pursuant to a shareholder rights plan or pursuant to an agreement with a third party for an investment, acquisition or
other business combination transaction or pursuant to any program established whereby suppliers and/or vendors may acquire shares
as an incentive to sell products). Any Holder shall be entitled to obtain injunctive relief against the Company to preclude any
such issuance, which remedy shall be in addition to any right to collect damages. 

 

(c)          Notwithstanding
the foregoing, this Section 4.2 shall not apply in respect of an Exempt Issuance, except that no Variable Rate Transaction shall
be an Exempt Issuance. “Exempt Issuance” means the issuance of (a) shares of Common Stock or options to employees,
officers, directors or consultants (consistent with past practice) of the Company pursuant to any stock incentive plan duly adopted
for such purpose, by a majority of the non-employee members of the Board of Directors or a majority of the members of a committee
of non-employee directors established for such purpose, (b) securities upon the exercise or exchange of or conversion of any Securities
issued hereunder and/or other securities exercisable or exchangeable for or convertible into shares of Common Stock issued and
outstanding on the date of this Agreement, provided that such securities have not been amended since the date of this Agreement
to increase the number of such securities or to decrease the exercise price, exchange price or conversion price of such securities
(other than in connection with stock splits or combinations) or to extend the term of such securities, (c) securities issued pursuant
to acquisitions or strategic transactions approved by a majority of the disinterested directors of the Company, provided that any
such issuance shall only be to a Person (or to the equityholders of a Person) which is, itself or through its subsidiaries, believed
by the Company to be an operating company or an owner of an asset in a business synergistic with the business of the Company, and
(d) issuances of shares pursuant to the Company’s Red Sun Trade Partners Program.

 

Section 4.3 Notices. Any and all
notices or other communications or deliveries required or permitted to be provided hereunder shall be made by email to the email
address of the Holder set forth on Holders’ signature page.

 

Section 4.4 Survival. All warranties
and representations (as of the date such warranties and representations were made) made herein or in any certificate or other instrument
delivered by it or on its behalf under this Agreement shall be considered to have been relied upon by the parties hereto and shall
survive the issuance of the New Warrants. This Agreement shall inure to the benefit of and be binding upon the successors and permitted
assigns of each of the parties; provided however that no party may assign this Agreement or the obligations and rights of such
party hereunder without the prior written consent of the other parties hereto.

 

    	 	8	 

     

    

 

Section 4.5 Execution. This
Agreement may be executed in two or more counterparts, all of which when taken together shall be considered one and the same agreement
and shall become effective when counterparts have been signed by each party and delivered to the other party, it being understood
that both parties need not sign the same counterpart. In the event that any signature is delivered by facsimile transmission, such
signature shall create a valid and binding obligation of the party executing (or on whose behalf such signature is executed) with
the same force and effect as if such facsimile signature page were an original thereof.

 

Section 4.6 Severability. If
any provision of this Agreement is held to be invalid or unenforceable in any respect, the validity and enforceability of the remaining
terms and provisions of this Agreement shall not in any way be affected or impaired thereby and the parties will attempt to agree
upon a valid and enforceable provision that is a reasonable substitute therefor, and upon so agreeing, shall incorporate such substitute
provision in this Agreement.

 

Section 4.7 Governing Law.
All questions concerning the construction, validity, enforcement and interpretation of this Agreement shall be determined pursuant
to the Governing Law provision of the New Warrants.

 

Section 4.8 Entire Agreement.
The Agreement, together with the exhibits and schedules thereto, contain the entire understanding of the parties with respect to
the subject matter hereof and supersede all prior agreements and understandings, oral or written, with respect to such matters,
which the parties acknowledge have been merged into such documents, exhibits and schedules.

 

Section 4.9 Construction. The
headings herein are for convenience only, do not constitute a part of this Agreement and shall not be deemed to limit or affect
any of the provisions hereof. The language used in this Agreement will be deemed to be the language chosen by the parties to express
their mutual intent, and no rules of strict construction will be applied against any party.

 

Section 4.10 Fees and Expenses.
Except as expressly set forth herein, each party shall pay the fees and expenses of its advisers, counsel, accountants and other
experts, if any, and all other expenses incurred by such party incident to the negotiation, preparation, execution, delivery and
performance of this Agreement. The Company shall pay all transfer agent fees, stamp taxes and other taxes and duties levied in
connection with the delivery of any Warrant Shares.

 

Section 4.11 Equal Treatment of New
Warrant Holders. No consideration (including any modification of this Agreement or the New Warrants) shall be offered or paid
to any holder of New Warrants to amend or consent to a waiver or modification of any provision of this Agreement or the New Warrants
unless the same consideration is also offered to all of the holders of the New Warrants. For clarification purposes, this provision
constitutes a separate right granted to each holder of New Warrants by the Company and negotiated separately by each holder of
the New Warrants, and is intended for the Company to treat the holders of New Warrants as a class and shall not in any way be construed
as the holders of New Warrants acting in concert or as a group with respect to the purchase, disposition or voting of Securities
or otherwise.

 

(remainder of page intentionally left
blank; signature page follows)

 

    	 	9	 

     

    

 

IN WITNESS WHEREOF, the undersigned
have executed this Warrant Exercise Agreement as of the date first written above.

 

COMPANY:

 

22ND CENTURY GROUP, INC.

 

	By:  	 	 
	Name:	 	 
	Title:  	 	 

 

Bank Account and Wire Instructions

 

[insert]

 

    	 	10	 

     

    

 

[HOLDER SIGNATURE PAGES TO 22ND CENTURY
GROUP 

WARRANT EXERCISE AGREEMENT] 

 

IN WITNESS WHEREOF, the undersigned have caused this Agreement
to be duly executed by their respective authorized signatories as of the date first indicated above.

 

	Name of Holder:	 	
 

 

	Signature of Authorized Signatory of Holder:	 	
 

 

	Name of Authorized Signatory:	 	
 

 

	Title of Authorized Signatory:	 	
 

 

	Email Address of Holder:	 	
 

 

	Number of July 2016 Warrants held: 	 	
 
	
         

        Number of October 2016 Warrants held:
	 	
 
	
         

        Number of  July 2016 Warrants deemed exercised:
	 	
 

 

	Number of  October 2016 Warrants deemed exercised:	 	
 

 

	Aggregate Exercise Price of  Warrants deemed Exercised:	 	
 

 

	Warrant Shares underlying  Warrants deemed exercised:	 	 

 

	Instructions for Warrant Shares to be issued upon initial exercise of Original Warrants:	 	 

 

	Number of New Warrants to be issued to Holder upon deemed exercise:	 	 

 

	Address for Delivery of New Warrants for Holder: 	 	 

 

 

    	 	11

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00272-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00272-of-00352.parquet"}]]