Document:

FORM OF CONTINGENT VALUE RIGHTS AGREEMENT

 

 

This CONTINGENT VALUE RIGHTS AGREEMENT
(this “Agreement”), dated as of June [__], 2013, is by and among American Realty Capital Properties, Inc., a
Maryland corporation (the “Company”), and the holder set forth on the signature page hereto (together with
their successor and their permitted assigns, the “Holder”).

 

WHEREAS, in connection with the
issuance by the Company of 28,398,213 shares of the Company’s Series C Convertible Preferred Stock (the “Series
C Preferred Stock”) on the date hereof pursuant to that certain Convertible Preferred Stock Purchase Agreement, dated
as of June 4, 2013 (the “Stock Purchase Agreement”), by and among the Company and the investors party thereto
(the “Investors”), the Company is obligated to issue 28,398,213 contingent value rights subject to the terms
and conditions contained herein (each such right, a “Contingent Value Right”), including [______] Contingent
Value Rights to the Holder (which initially is an Investor) pursuant to this Agreement. Capitalized terms used but not defined
in this Agreement shall have the respective meanings assigned thereto in the Stock Purchase Agreement.

 

NOW, THEREFORE, in consideration
of the mutual covenants and undertakings contained herein and for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto hereby agree as follows:

 

		1)	Definitions. In addition to the terms defined elsewhere in this Agreement, the following terms
have the meanings indicated:

 

“Articles” means
the Articles Supplementary for the Series C Preferred Stock.

 

“Test Date” means the
121st trading day following the Election Date (as defined in the Articles).

 

“VWAP” means the dollar
volume-weighted average price for the Common Stock on its Trading Market during the period beginning at 9:30:01 a.m., New York
time (or such other time as the Trading Market publicly announces is the official open of trading), and ending at 4:00:00 p.m.,
New York time (or such other time as the Trading Market publicly announces is the official close of trading), as reported by Bloomberg,
L.P. through its “Volume at Price” function or, if the foregoing does not apply, the dollar volume-weighted average
price of such security in the over-the-counter market on the electronic bulletin board for such security during the period beginning
at 9:30:01 a.m., New York time (or such other time as the Trading Market publicly announces is the official open of trading), and
ending at 4:00:00 p.m., New York City Time (or such other time as the Trading Market publicly announces is the official close
of trading), as reported by Bloomberg, L.P., or, if no dollar volume-weighted average price is reported for such security by Bloomberg,
L.P. for such hours, the average of the highest closing bid price and the lowest closing ask price of any of the market makers
for such security as reported in the “pink sheets” by Pink Sheets LLC (formerly the National Quotation Bureau, Inc.).
If the VWAP cannot be calculated for the Common Stock on a particular date on any of the foregoing bases, the VWAP of the Common
Stock shall be the fair market value of the Common Stock on such date as determined by the Company’s Board of Directors in
good faith.

 

    	 

    	 

    
 

		2)	Contingent Value Rights. In the event the Company converts (regardless of whether any such
shares are actually converted pursuant to Section 13 of the Articles Supplementary) the shares of Series C Preferred Stock into
Common Stock pursuant to the terms of the Stock Purchase Agreement and the Articles, then:

 

(a)   
On the Test Date, the Company shall calculate the VWAP per Common Share for the period covering the 90th through
the 120th trading days after the Election Date (as defined in the Articles) (the “CVR Period VWAP”).

 

(b)  
Within five (5) Business Days following the Test Date, the Company shall pay to the Holder, in immediately available funds
to an account designated in writing by such Holder, the amount, if any, with respect to each share of the Common Stock into which
shares of Series C Preferred Stock were converted (regardless of whether any such shares are actually converted pursuant to Section
13 of the Articles Supplementary) (“Common Shares”) held by such Holder (and/or its assignees) on the Test Date
equal to: (i) the number of Common Shares held by such Investor at the close of business on the Test Date multiplied by
(ii) the amount (the “Settlement Amount”), which shall not be less than zero nor greater than $2.00, equal to
the difference between (A) the Conversion Price (as defined in the Articles) (as may be adjusted from time to time pursuant to
Section 7 of the Articles) and (B) the CVR Period VWAP.

 

(c)   
If the number of shares of Common Stock is adjusted upon the occurrence of any event that would have resulted in the adjustment
of the Fixed Conversion Price (as defined in the Articles Supplementary), the number of Contingent Value Rights shall be adjusted
proportionately.

 

		3)	Termination. This Agreement shall terminate and no Holder shall have any rights hereunder (to payment or otherwise)
upon (i) the payment by the Company of the Settlement Amount, if any, due to the Holder pursuant to Section 2 or (2)
the redemption of the Series C Preferred Stock in accordance with Section 5 of the Articles Supplementary.
	 	 	 
		4)	Assignment. This Agreement shall be binding upon and inure to the benefit of the parties and their successors and permitted
assigns. The Company may not assign this Agreement or any rights or obligations hereunder without the prior written consent of
the Holder. Any Holder may assign all or a portion of its rights under this Agreement to any Person, provided (i) such transferee
is a “qualified institutional buyer” (as defined in Rule 144A under the Securities Act of 1933, as amended (the “Securities
Act”), (ii) such transferor agrees in writing with the transferee or assignee to assign such rights, and a copy of such
agreement is furnished to the Company after such assignment, (iii) the Company is furnished with written notice of the name and
address of such transferee or assignee, (iv) such transferee agrees in writing to be bound by the provisions hereof that apply
to the “Holder”, (v) such transfer shall have been made pursuant to the safe harbor for the resale of restricted securities
provided by Rule 144A under the Securities Act provided, however, that for purposes of this clause (v): (1) this Agreement or any
rights or obligations hereunder shall be deemed not to be the same class of securities as the Common Stock for purposes of Rule
144A(d)(3)(i) and (2) if the Company as the “issue” does not meet the requirements of Rule 144A(d)(4), then this Agreement
or any rights or obligations hereunder may be assigned pursuant to any other exemption from registration under the Securities Act
and (vi) such transfer shall have been made pursuant to and in accordance with the applicable requirements of this Agreement and
with all laws applicable thereto.

 

    	 

    	 

    
 

		5)	No Rights as Shareholders. This Agreement shall not entitle the Holder (or its successors or permitted assigns)
to any voting rights or other rights as a stockholder of the Company.
	 	 	 
		6)	Incorporation of Certain Sections By Reference. The following sections from the Stock Purchase Agreement shall be deemed
incorporated by reference into this Agreement, with appropriate changes as the context requires: Sections 9.6, 9.7, 9.8, 9.10,
9.11, 9.13, 9.14, 9.16 and 9.19.

 

[Signature pages follow.]

    	 

    	 

    

 

IN WITNESS WHEREOF, each
party hereto has duly executed this Agreement or has caused this Agreement to be duly executed by an authorized officer as of the
day and year first above written.

 

	 	AMERICAN REALTY CAPITAL PROPERTIES, INC.
	 	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:

 

    	 

    	 

    

 

	 	[NAME OF HOLDER]
	 	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:THIS WARRANT AND THE SECURITIES PURCHASABLE
HEREUNDER HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 AND MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED
IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FILED UNDER SAID ACT AND ANY APPLICABLE STATE SECURITIES LAWS, UNLESS AN
EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE.

 

BACTERIN INTERNATIONAL HOLDINGS, INC.

 

WARRANT

 

dated as of June 5, 2013

 

THIS CERTIFIES THAT, for value received,
________________ or its successors or permitted assigns (such Person and such successors and assigns each being the “Warrant
Holder” with respect to the Warrant held by it), at any time and from time to time on any Business Day on or prior to 5:00
p.m. (New York City time), on the Expiration Date (as herein defined), is entitled (a) to subscribe for the purchase from
Bacterin International Holdings, Inc., a Delaware corporation (the “Company”), _____ Shares at a price per Share equal
to the Exercise Price (as herein defined), and (b) to the other rights set forth herein; provided that the number of
Shares issuable upon any exercise of this Warrant and the Exercise Price shall be adjusted and readjusted from time to time in
accordance with Section 5. By accepting delivery hereof, the Warrant Holder agrees to be bound by the provisions hereof.

 

This Warrant is one of a series of similar
warrants issued pursuant to that certain Securities Purchase Agreement, dated as of June 5, 2013, by and among the Company and
the Purchasers identified therein. All such warrants, together with any other similar warrants issued by the Company as part of
the same financing, are referred to herein, collectively, as the “Warrants.”

 

IN FURTHERANCE THEREOF, the Company irrevocably
undertakes and agrees for the benefit of Warrant Holder as follows:

 

Section 1.Definitions and Construction.

 

(a)Certain Definitions. As used
herein (the following definitions being applicable in both singular and plural forms):

 

“Affiliate” means,
with respect to any Person, any other Person that directly or indirectly controls, is controlled by, or is under common control
with such Person.

 

“Appraised Value”
means at any time the fair market value thereof determined in good faith by the Board of Directors of the Company as of a date
which is within ten (10) days of the date as of which the determination is to be made, subject to the rights of the Requisite Holders
pursuant to Section 5(n).

 

“Business Day”
means any day except a Saturday, Sunday or other day on which commercial banks in New York City are authorized by law to close.

 

“Closing Price”
means, for any trading day with respect to a Share, (a) the last reported sale price on such day on the principal national
securities exchange on which the Shares are listed or admitted to trading or, if no such reported sale takes place on any such
day, the average of the closing bid and asked prices thereon, as reported in The Wall Street Journal, or (b) if such
Shares shall not be listed or admitted to trading on a national securities exchange, the last reported sales price on the NASDAQ
National Market System or, if no such reported sale takes place on any such day, the average of the closing bid and asked prices
thereon, as reported in The Wall Street Journal, or (c) if such Shares shall not be quoted on such National Market
System nor listed or admitted to trading on a national securities exchange, then the average of the closing bid and asked prices,
as reported by The Wall Street Journal for the over-the-counter market; provided that if clause (a), (b), or (c)
applies and no price is reported in The Wall Street Journal for any trading day, then the price reported in The Wall
Street Journal for the most recent prior trading day shall be deemed to be the price reported for such trading day.

 

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“Commission” means
the Securities and Exchange Commission or any other Federal agency administering the Securities Act at the time.

 

“Exchange Act”
means the Securities Exchange Act of 1934, or any successor Federal statute, and the rules and regulations of the Commission thereunder,
all as the same shall be in effect at the time.

 

“Exercise Amount”
means for any number of Warrant Shares as to which this Warrant is being exercised the product of (i) such number of Warrant
Shares times (ii) the Exercise Price.

 

“Exercise Floor”
means $0.64 per Warrant Share.

 

“Exercise Price”
means $0.72 per Warrant Share, as adjusted from time to time pursuant to Section 5.

 

“Expiration Date”
means December 5, 2020.

 

“Initial Holder”
means ________________.

 

“Market Price”
on any day means (a) the unweighted average of the daily Closing Prices per Share for the 20 consecutive trading days prior
to such date or (b) if clauses (a), (b) and (c) of the definition of “Closing Price” are inapplicable,
then the Appraised Value as of such day shall apply; provided that for purposes of the application of Section 5(b)
to a Share Distribution pursuant to a public offering registered under the Securities Act, “Market Price” means the
Closing Price per Share for the trading day preceding the effective date of the registration statement with respect to such public
offering (or in the case of an initial public offering, the price per Share in such offering).

 

“Person” means
an individual, a corporation, a partnership, an association, a trust or any other entity or organization, including a government
or political subdivision or an agency or instrumentality thereof.

 

“Requisite Holders”
means at any time holders of Warrant Shares and Warrants representing at least a majority of the Warrant Shares outstanding or
issuable upon the exercise of all the outstanding Warrants.

 

“Securities Act”
means the Securities Act of 1933, or any successor Federal statute, and the rules and regulations of the Commission thereunder,
all as the same shall be in effect at the time.

 

“Shares” means
the Company's currently authorized common stock, $0.000001 par value, and stock of any other class or other consideration into
which such currently authorized capital stock may hereafter have been changed.

 

“Warrant” means,
as the context requires, this warrant and any successor warrant or warrants issued upon a whole or partial transfer or assignment
of any such Share purchase warrant or of any such successor warrant.

 

“Warrant Shares”
means the number of Shares issued or issuable upon exercise of this Warrant as set forth in the introduction hereto, as adjusted
from time to time pursuant to Section 5, or in the case of other Warrants, issuable upon exercise of those Warrants.

 

(b)Accounting Terms and Determinations.
Unless otherwise specified herein, all accounting terms used herein shall be interpreted, all accounting determinations hereunder
shall be made, and all financial statements required to be delivered hereunder shall be prepared, in accordance with generally
accepted accounting principles. When used herein, the term “financial statements” shall include the notes and schedules
thereto. References to fiscal periods are to fiscal periods of the Company.

 

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(c)Computation of Time Periods.
With respect to the computation of periods of time from a specified date to a later specified date, the word “from”
means “from and including” and the words “to” and “until” each mean “to but excluding.”
Periods of days shall be counted in calendar days unless otherwise stated.

 

(d)Construction. Unless the context
requires otherwise, references to the plural include the singular and to the singular include the plural, references to any gender
include any other gender, the part includes the whole, the term “including” is not limiting, and the term “or”
has, except where otherwise indicated, the inclusive meaning represented by the phrase “and/or.” The words “hereof,”
“herein,” “hereby,” “hereunder,” and similar terms in this Warrant refer to this Warrant as
a whole and not to any particular provision of this Warrant. Section, subsection, clause, exhibit and schedule references are to
this Warrant, unless otherwise specified. Any reference to this Warrant includes any and all permitted alterations, amendments,
changes, extensions, modifications, renewals, or supplements thereto or thereof, as applicable.

 

(e)Exhibits and Schedules. All
of the exhibits and schedules attached hereto shall be deemed incorporated herein by reference.

 

(f)No Presumption Against Any Party.
Neither this Warrant nor any uncertainty or ambiguity herein or therein shall be construed or resolved using any presumption against
any party hereto or thereto, whether under any rule of construction or otherwise. On the contrary, this Warrant has been reviewed
by each of the parties and their counsel and, in the case of any ambiguity or uncertainty, shall be construed and interpreted according
to the ordinary meaning of the words used so as to fairly accomplish the purposes and intentions of all parties hereto.

 

Section 2.Exercise of Warrant.

 

(a)Exercise and Payment. The
Warrant Holder may exercise this Warrant in whole or in part, at any time or from time to time on any Business Day beginning six
months after the date on which this Warrant is issued on or prior to the Expiration Date, by delivering to the Company either the
original Warrant or a lost warrant affidavit, a duly executed notice (a “Notice of Exercise”) in the
form of Exhibit A and by payment to the Company of the Exercise Price per Warrant Share, at the election of the Warrant
Holder, either (a) by wire transfer of immediately available funds to the account of the Company in an amount equal to the
Exercise Amount, (b) by receiving from the Company the number of Warrant Shares equal to (i) the number of Warrant Shares
as to which this Warrant is being exercised minus (ii) the number of Warrant Shares having a value, based on the Closing Price
on the trading day immediately prior to the date of such exercise (or if there is no such Closing Price, then based on the Appraised
Value as of such day), equal to the Exercise Amount, or (c) any combination of the foregoing. The Company acknowledges that the
provisions of clause (b) are intended, in part, to ensure that a full or partial exchange of this Warrant pursuant to such clause
(b) will qualify as a conversion, within the meaning of paragraph (d)(3)(iii) of Rule 144 under the Securities Act. At the request
of any Holder, the Company will accept reasonable modifications to the exchange procedures provided for in this Section in order
to accomplish such intent. For all purposes of this Warrant (other than this Section 2(a)), any reference herein to the exercise
of this Warrant shall be deemed to include a reference to the exchange of this Warrant into Shares in accordance with the terms
of clause (b).

 

(b)Effectiveness and Delivery.
As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise, (provided
requisite payment shall have been received prior to such date), the Company shall execute and deliver or cause to be executed and
delivered, in accordance with such Notice of Exercise, a certificate or certificates representing the number of Shares specified
in such Notice of Exercise, issued in the name of the Warrant Holder or in such other name or names of any Person or Persons designated
in such Notice of Exercise. This Warrant shall be deemed to have been exercised and such Share certificate or certificates shall
be deemed to have been issued, and the Warrant Holder or other Person or Persons designated in such Notice of Exercise shall be
deemed for all purposes to have become a holder of record of Shares, all as of the date that such Notice of Exercise.

 

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(c)Surrender of Warrant. The
Warrant Holder shall surrender this Warrant to the Company when it delivers the Notice of Exercise, and in the event of a partial
exercise of the Warrant, the Company shall execute and deliver to the Warrant Holder, at the time the Company delivers the Share
certificate or certificates issued pursuant to such Notice of Exercise, a new Warrant for the unexercised portion of the Warrant,
but in all other respects identical to this Warrant.

 

(d)Legend. Each certificate for
Warrant Shares issued upon exercise of this Warrant, unless at the time of exercise such Warrant Shares are registered under the
Securities Act, shall bear the following legend:

 

THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933 AND MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
FILED UNDER SAID ACT AND ANY APPLICABLE STATE SECURITIES LAWS, UNLESS AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE.

 

Any certificate for Warrant Shares issued
at any time in exchange or substitution for any certificate bearing such legend (unless at that time such Warrant Shares are registered
under the Securities Act) shall also bear such legend unless, in the written opinion of counsel selected by the holder of such
certificate (who may be an employee of such holder), which counsel and opinion shall be reasonably acceptable to the Company, the
Warrant Shares represented thereby need no longer be subject to restrictions on resale under the Securities Act. If the Warrant
is exercised when there is an effective registration statement covering the underlying Warrant Shares, the certificate for the
Warrant Shares shall not bear a legend.

 

(e)No Fractional Shares. No fractional
Shares shall be issued by the Company in connection with any exercise of this Warrant. If any
fractional Shares would, but for this restriction, be issuable upon an exercise of the Warrant, in lieu of delivering such fractional
Shares, the number of Shares to be issued shall be rounded down to the next whole number and the
Company shall pay to the Warrant Holder, in cash, an amount equal to the same fraction times the Closing Price on the trading day
immediately prior to the date of such exercise (or if there is no such Closing Price, then based on the Appraised Value as of such
day).

 

(f)Expenses and Taxes. The Company
shall pay all expenses, taxes and owner charges payable in connection with the preparation, issuance and delivery of certificates
for the Warrant Shares and any new Warrants, except that if the certificates for the Warrant Shares or the new Warrants are to
be registered in a name or names other than the name of the Warrant Holder, funds sufficient to pay all transfer taxes payable
as a result of such transfer shall be paid by the Warrant Holder at the time of its delivery of the Notice of Exercise or promptly
upon receipt of a written request by the Company for payment.

 

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Section 4.Validity of Warrant and
Issuance of Shares.

 

(a)The Company represents and warrants
that this Warrant has been duly authorized, is validly issued, and constitutes the valid and binding obligation of the Company.

 

(b)The Company further represents and
warrants that on the date hereof it has duly authorized and reserved, and the Company hereby agrees that it will at all times until
the Expiration Date have duly authorized and reserved, such number of Shares as will be sufficient to permit the exercise in full
of the Warrant, and that all such Shares are and will be duly authorized and, when issued upon exercise of the Warrant, will be
validly issued, fully paid and non-assessable, and free and clear of all security interests, claims, liens, equities and other
encumbrances.

 

Section 5.Antidilution Provisions.
The Exercise Price in effect at any time, and the number of Warrant Shares that may be purchased upon any exercise of the Warrant,
shall be subject to change or adjustment as follows:

 

(a)Share Reorganization. If the
Company shall subdivide its outstanding Shares into a greater number of Shares, by way of a stock split, stock dividend or otherwise,
or consolidate its outstanding Shares into a smaller number of Shares (any such event being herein called a “Share
Reorganization”), then (i) the Exercise Price shall be adjusted, effective immediately after the effective date
of such Share Reorganization, to a price determined by multiplying the Exercise Price in effect immediately prior to such effective
date by a fraction, the numerator of which shall be the number of Shares outstanding on such effective date before giving effect
to such Share Reorganization and the denominator of which shall be the number of Shares outstanding after giving effect to such
Share Reorganization, and (ii) the number of Shares subject to purchase upon exercise of this Warrant shall be adjusted, effective
at such time, to a number determined by multiplying the number of Shares subject to purchase immediately before such Share Reorganization
by a fraction, the numerator of which shall be the number of Shares outstanding after giving effect to such Share Reorganization
and the denominator of which shall be the number of Shares outstanding immediately before giving effect to such Share Reorganization.

 

(b)Share Distribution.

 

(i)If the Company shall issue, sell
or otherwise distribute any Shares (including, for the avoidance of doubt, any deemed issuance, sale or distribution described
in paragraphs (ii) and (iii) below), other than pursuant to a Share Reorganization (which is governed by Section 5(a))
(any such event, including any event described in paragraphs (ii) and (iii) below, being herein called a “Share
Distribution”), for a consideration per Share less than the greater of (x) the Market Price immediately prior
to such Share Distribution or (y) the Exercise Price then in effect, then, effective upon such Share Distribution, the Exercise
Price shall be reduced to the greater of (1) the Exercise Floor and (2) a price determined by multiplying the Exercise Price by
a fraction, the numerator of which shall be the sum of (A) the number of Shares outstanding immediately prior to such Share
Distribution multiplied by the higher of such Market Price and the Exercise Price, plus (B) the consideration, if any, received
by the Company upon such Share Distribution, and the denominator of which shall be the product of (1) the total number of
Shares outstanding immediately after such Share Distribution multiplied by (2) the higher of such Market Price and the Exercise
Price. If any Share Distribution shall require an adjustment to the Exercise Price pursuant to the foregoing provisions of this
Section 5(b), including by operation of paragraph (ii) or (iii) below, then, effective at the time such adjustment is made,
the number of Shares subject to purchase upon exercise of this Warrant shall be increased to a number determined by multiplying
the number of Shares subject to purchase immediately before such Share Distribution by a fraction, the numerator of which shall
be the Exercise Price in effect immediately prior to such event and the denominator of which shall be the Exercise Price as adjusted
in accordance with this Section 5(b). Notwithstanding anything to the contrary in this Section 5(b), under no circumstances
shall the Exercise Price be an amount lower than the Exercise Floor.

 

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(ii)If the Company shall issue,
sell, distribute or otherwise grant in any manner other than pursuant to the Company’s Equity Incentive Plan or any successor
stock option plan approved by the Company’s Board of Directors (including by assumption) any rights to subscribe for or to
purchase, or any warrants or options for the purchase of Shares or any securities convertible into or exchangeable for Shares such
rights, warrants or options being herein called “Options” and such convertible or exchangeable securities
being herein called “Convertible Securities”), whether or not such Options or the rights to convert or
exchange any such Convertible Securities in respect of such Options are immediately exercisable or exercisable prior to the Expiration
Date or thereafter, and the price per Share for which Shares are issuable upon the exercise of such Options or upon conversion
or exchange of such Convertible Securities in respect of such Options (determined by dividing (x) the aggregate amount, if
any, received or receivable by the Company as consideration for the granting of such Options, plus the minimum aggregate amount
of additional consideration payable to the Company upon the exercise of all such Options, plus, in the case of Options to acquire
Convertible Securities, the minimum aggregate amount of additional consideration, if any, payable upon issuance or sale of such
Convertible Securities and upon the conversion or exchange thereof, by (y) the total maximum number of Shares issuable upon
the exercise of such Options or upon the conversion or exchange of all such Convertible Securities issuable upon the exercise of
such Options) shall be less than the greater of (A) the Market Price immediately prior to the granting of such Options or
(B) the Exercise Price, then, for purposes of Section 5(b)(i), the total maximum number of Shares issuable upon the exercise
of such Options or upon conversion or exchange of the total maximum amount of such Convertible Securities issuable upon the exercise
of such Options shall be deemed to have been issued as of the date of granting of such Options and thereafter shall be deemed to
be outstanding and the Company shall be deemed to have received as consideration of such price per Share, determined as provided
above, therefor. Except as otherwise provided in paragraph (iv) below, no additional adjustment of the Exercise Price shall be
made upon the actual exercise of such Options or upon conversion or exchange of such Convertible Securities.

 

(iii)If the Company shall issue,
sell or otherwise distribute (including by assumption) any Convertible Securities, whether or not the rights to exchange or convert
thereunder are immediately exercisable or exercisable prior to the Expiration Date or thereafter, and the price per Share for which
Shares are issuable upon the conversion or exchange of such Convertible Securities (determined by dividing (x) the aggregate amount
received or receivable by the Company as consideration for the issuance, sale or distribution of such Convertible Securities, plus
the minimum aggregate amount of additional consideration, if any, payable to the Company upon the conversion or exchange thereof,
by (y) the maximum number of Shares issuable upon the conversion or exchange of all such Convertible Securities) shall be less
than the greater of (A) the Market Price immediately prior to such issuance, sale or distribution or (B) the Exercise Price, then,
for purposes of Section 5(b)(i), the total maximum number of Shares issuable upon conversion or exchange of all such Convertible
Securities shall be deemed to have been issued as of the date of the issuance, sale or distribution of such Convertible Securities
thereafter shall be deemed to be outstanding and the Company shall be deemed to have received as consideration such price per Share,
determined as provided above, therefor. Except as otherwise provided in paragraph (iv) below, no additional adjustment of the Exercise
Price shall be made upon the actual conversion or exchange of such Convertible Securities.

 

(iv)If (x) the purchase price provided
for in any Option referred to in Section 5(b)(ii) or the additional consideration, if any, payable upon the conversion or
exchange of any Convertible Securities referred to in Sections 5 (b)(ii) or 5(b)(iii) or the rate at which any Convertible
Securities referred to in Sections 5(b)(ii) or 5(b)(iii) are convertible into or exchangeable for Shares shall change
at any time (other than under or by reason of provisions designed to protect against dilution upon an event which results in a
related adjustment pursuant to this Section 5), or (y) any of such Options or Convertible Securities shall have terminated,
lapsed or expired, the Exercise Price then in effect shall forthwith be readjusted (effective only with respect to any exercise
of this Warrant after such readjustment) to the greater of (1) the Exercise Floor and (2) the Exercise Price which would then be
in effect had the adjustment made upon the issuance, sale, distribution or grant of such Options or Convertible Securities been
made based upon such changed purchase price, additional consideration or conversion rate, as the case may be (in the case of any
event referred to in clause (x) of this paragraph (iv)) or had such adjustment not been made (in the case of any event referred
to in clause (y) of this paragraph (iv)). Notwithstanding anything to the contrary in this Section 5(b), under no circumstances
shall the Exercise Price be an amount lower than the Exercise Floor. No adjustment under this subsection shall have the effect
of increasing the Exercise Price.

 

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(v)If the Company shall pay a dividend
or make any other distribution upon any capital stock of the Company payable in Shares, Options or Convertible Securities, other
than pursuant to a Share Reorganization (which is governed by Section 5(a)), then, for purposes of this Section 5(b),
such Shares, Options or Convertible Securities shall be deemed to have been issued or sold without consideration.

 

(vi)If any Shares, Options or Convertible
Securities shall be issued, sold or distributed for cash, the consideration received therefor shall be deemed to be the amount
received by the Company therefore, less any expenses in excess of reasonable and customary expenses in connection therewith. If
any Shares, Options or Convertible Securities shall be issued, sold or distributed for a consideration other than cash, the amount
of the consideration other than cash received by the Company shall be deemed to be the fair market value of such consideration
at the time of its receipt by the Company as determined in good faith by the Board of Directors of the Company, less any expenses
in excess of reasonable and customary expenses incurred in connection therewith. If any Shares, Options or Convertible Securities
shall be issued in connection with any merger in which the Company is the surviving entity, the amount of consideration therefore
shall be deemed to be the fair market value of such portion of the assets and business of the non-surviving entity as shall be
attributable to such Shares, Options or Convertible Securities, as the case may be, at the time of the merger as determined in
good faith by the Board of Directors of the Company (in making such determination the members of its Board of Directors may give
effect to the proposed acquisition and incorporate the prospects of the performance of the assets and business of the non-surviving
corporation over the 12 month period following the acquisition, including any reasonably demonstrate synergistic or value enhancing
factors). If any Options shall be issued in connection with the issuance and sale of other securities of the Company, together
comprising one integral transaction in which no specific consideration is allocated to such Options by the parties thereto, such
Options shall be deemed to have been issued without consideration.

 

(c)Special Distributions;
Above Market Purchases of Securities.

 

(i)If the Company shall issue or
distribute to any holder or holders of Shares evidences of indebtedness, any other securities of the Company or any cash, property
or other assets (excluding (i) a Share Reorganization and (ii) a Share Distribution), whether or not accompanied by a purchase,
redemption or other acquisition of Shares (any such nonexcluded event being herein called a “Special Distribution”),
then the Warrant Holder shall be entitled to a pro-rata Share of such Special Distribution as though the Warrant Holder had fully
exercised this Warrant immediately prior to the record date for such Special Distribution, and the Company shall pay or distribute
such pro-rata share to Warrant Holder when paid or distributed to the holders of the Shares. A reclassification of the Shares (other
than a change in par value, or from par value to no par value or from no par value to par value) into shares of any other class
of stock shall be deemed to be a distribution by the Company to the holders of its Shares of such class of stock and, if the outstanding
Shares shall be changed into a larger or smaller number of Shares as part of such reclassification, a Share Reorganization. Notwithstanding
anything to the contrary in this Section 5(c), under no circumstances shall the Exercise Price be an amount lower than the
Exercise Floor.

 

    	7

    	 

    

 

(ii)If, at any time after the date
hereof, the Company or any Subsidiary shall repurchase (a “Repurchase”), by self-tender offer or otherwise,
any securities of the Company at an aggregate repurchase price that exceeds the aggregate Market Price for the securities repurchased
determined as of the Business Day immediately prior to the earliest of (i) the date of such Repurchase, (ii) the commencement of
an offer to repurchase or (iii) the public announcement of either (such date being referred to as the “Determination Date”),
then the Exercise Price and the number of Warrant Shares issuable upon exercise of this Warrant shall be adjusted as follows: The
Exercise Price shall be reduced to an amount equal to the greater of (1) the Exercise Floor and (2) the product of (A) the Exercise
Price in effect immediately prior to such issuance or sale times (B) a fraction, (I) the numerator of which shall be (x) the product
of (1) the Market Price for the Shares as of the Determination Date times (2) the number of Shares outstanding immediately following
the consummation of the Repurchase less (y) the Repurchase Premium (as defined below), and (II) the denominator of which shall
be (x) the product of (1) the Market Price for the Shares as of the Determination Date times (2) the number of Shares outstanding
immediately following the consummation of the Repurchase.

 

(B)The number of Warrant Shares
issuable upon exercise of this Warrant shall be increased to the number of Shares determined by multiplying (x) the number of Warrant
Shares issuable upon exercise of this Warrant immediately prior to such distribution times (y) a fraction (1) the numerator of
which shall be the Exercise Price in effect immediately prior to the adjustment in clause (A) of this Section 5(c)(ii) and (2)
the denominator of which shall be the Exercise Price (which shall in no circumstances be an amount less than the Exercise Floor)
in effect immediately after such adjustment.

 

The amount by which the aggregate repurchase
price for all securities repurchased in any Repurchase (including for such purposes any fees or other direct or indirect consideration
payable in connection therewith) exceeds the aggregate Market Price for such securities is referred to as the “Repurchase
Premium.”

 

(d)Capital Reorganization. Without
limiting any of the other provisions hereof, if any (i) capital reorganization; (ii) reclassification of the capital stock of the
Company; (iii) merger, consolidation or reorganization or other similar transaction or series of related transactions which results
in the voting securities of the Company outstanding immediately prior thereto representing immediately thereafter (either by remaining
outstanding or by being converted into voting securities of the surviving or acquiring entity) less than 50% of the combined voting
power of the voting securities of or economic interests in the Company or such surviving or acquiring entity outstanding immediately
after such merger, consolidation or reorganization; (iv) sale, lease, license, transfer, conveyance or other disposition of all
or substantially all of the assets of the Company; (v) sale of shares of capital stock of the Company, in a single transaction
or series of related transactions, representing at least 50% of the voting power of the voting securities of or economic interests
in the Company; or (vi) the acquisition by any “person” (together with his, her or its Affiliates) or “group”
(within the meaning of Section 13(d) or 14(d) of the Exchange Act) acquires, directly or indirectly, the beneficial ownership (as
such term is defined in Rule 13d-3 promulgated under the Exchange Act) of outstanding shares of capital stock and/or other equity
securities of the Company, in a single transaction or series of related transactions (including, without limitation, one or more
tender offers or exchange offers), representing at least 50% of the voting power of or economic interests in the then outstanding
shares of capital stock of the corporation (each of (i)-(vi) above a “Corporate Reorganization”) shall
be effected, then the Company shall use its best efforts to ensure that lawful and adequate provision shall be made whereby each
Warrant Holder shall thereafter continue to have the right to purchase and receive upon the basis and upon the terms and conditions
herein specified and in lieu of the Warrant Shares issuable upon exercise of the Warrants held by such Warrant Holder, shares of
stock in the surviving or acquiring entity (“Acquirer”), as the case may be, such that the aggregate
value of the Warrant Holder’s warrants to purchase such number of shares, where the value of each new warrant to purchase
one share in the Acquirer is determined in accordance with the Black-Scholes Option Pricing formula set forth in Appendix (A)
hereto, is equivalent to the aggregate value of the Warrants held by such Warrant Holder, where the value of each Warrant to purchase
one share in the Company is determined in accordance with the Black-Scholes Option Pricing formula set forth Appendix (B)
hereto. Furthermore, the new warrants to purchase shares in the Acquirer referred to herein shall have the same expiration date
as the Warrants, and shall have a strike price, KAcq, that is calculated in accordance with Appendix (A) hereto.
For the avoidance of doubt, if the surviving or acquiring entity, as the case may be, is a member of a consolidated group for financial
reporting purposes, the “Acquirer” shall be deemed to be the parent of such consolidated group for purposes of this
Section 8(b) and Appendix (A) hereto. Notwithstanding anything to the contrary in this Warrant or in the Appendices hereto,
under no circumstances shall the strike price of KAcq be an amount lower than the Exercise Floor.

 

    	8

    	 

    

 

Moreover, appropriate provision shall be made with respect to
the rights and interests of each Warrant Holder to the end that the provisions hereof (including, without limitation, provision
for adjustment of the Warrant Price) shall thereafter be applicable, as nearly equivalent as may be practicable in relation to
any shares of stock thereafter deliverable upon the exercise thereof. The Company shall not effect any such Corporate Reorganization
unless prior to or simultaneously with the consummation thereof the successor corporation resulting from such consolidation or
merger, or the corporation purchasing or otherwise acquiring such assets or other appropriate corporation or entity shall assume
by written instrument, reasonably deemed by the Board of Directors of the Company and the Requisite Holders to be satisfactory
in form and substance, the obligation to deliver to the holder of the Warrants, at the last address of such holder appearing on
the books of the Company, such shares of stock, as, in accordance with the foregoing provisions, such holder may be entitled to
purchase, and the other obligations under these Warrants. The provisions of this Section 8(b) shall similarly apply to successive
Corporate Reorganizations. If the Company, in spite of using its best efforts, is unable to cause these Warrants to continue in
full force and effect until the Expiration Date in connection with any Corporate Reorganization, then the Company shall pay the
Warrant Holders an amount per Warrant to purchase one share in the Company that is calculated in accordance with the Black-Scholes
Option Pricing formula set forth in Appendix (B) hereto. Such payment shall be made in cash in the event that the Corporate
Reorganization results in the Company or the shareholders of the Company receiving cash from the Acquirer at the closing of the
transaction, and shall be made in shares of the Company (with the value of each share in the Company is determined according to
SCorp in Appendix (B) hereto) for all other Corporate Reorganizations . In the event that a Corporate
Reorganization involves the payment of cash as well as other secuirties, such payment to the Warrant Holders shall be also be made
in both cash and shares in the same proportion as the cash and non-cash portions of the consideration s.

 

(e)Adjustment Rules.

 

(i)Any adjustments pursuant to this Section 5
shall be made successively whenever any event referred to herein shall occur, except that, notwithstanding any other provision
of this Section 5, no adjustment shall be made to the number of Warrant Shares to be delivered to the Warrant Holder (or to
the Exercise Price) if such adjustment represents less than 1% of the number of Warrant Shares previously required to be so delivered,
but any lesser adjustment shall be carried forward and shall be made at the time and together with the next subsequent adjustment
which together with any adjustments so carried forward shall amount to 1% or more of the number of Warrant Shares to be so delivered.

 

    	9

    	 

    

 

(ii)No adjustments shall be made pursuant
to this Section 5 in respect of the issuance of Warrant Shares upon exercise of the Warrant;

 

(iii) If the Company shall take a record of
the holders of its Shares for any purpose referred to in this Section 5, then (x) such record date shall be deemed to be the
date of the issuance, sale, distribution or grant in question and (y) if the Company shall legally abandon such action prior to
effecting such action, no adjustment shall be made pursuant to this Section 5 in respect of such action.

 

(iv)In computing adjustments under this
Section 5, (A) fractional interests in Shares shall be taken into account to the nearest one-thousandth of a Share, and
(B) calculations of the Exercise Price shall be carried to the nearest one-thousandth of one cent.

 

(v)Notwithstanding anything to the contrary
herein, under no circumstances shall the Exercise Price, directly or indirectly (including, without limitation, through a cashless
exercise or through the issuance of new Shares, Warrants or convertible securities) be an amount lower than the Exercise Floor.

 

(f)Proceedings Prior to Any Action
Requiring Adjustment. As a condition precedent to the taking of any action which would require an adjustment pursuant to this
Section 5, the Company shall take any action which may be necessary, including obtaining regulatory approvals or exemptions,
in order that the Company may thereafter validly and legally issue as fully paid and nonassessable all Shares which the Warrant
Holder is entitled to receive upon exercise of the Warrant.

 

(g)Notice of Adjustment. Not
less than 20 days prior to the record date or effective date, as the case may be, of any action which requires or might require
an adjustment or readjustment pursuant to this Section 5, the Company shall give notice to the Warrant Holder of such
event, describing such event in reasonable detail and specifying the record date or effective date, as the case may be, and, if
determinable, the required adjustment and computation thereof. If the required adjustment is not determinable as the time of such
notice, the Company shall give notice to the Warrant Holder of such adjustment and computation as soon as reasonably practicable
after such adjustment becomes determinable. In connection with any such adjustment or readjustment, at its sole cost and expense,
the Company will also cause independent certified public accountants of recognized national standing (which may be the regular
auditors of the Company) selected by the Company to verify its computations and, in connection with the preparation of the Company’s
quarterly financial statements prepare a report setting forth such adjustment or readjustment and showing in reasonable detail
the method of calculation thereof and the facts upon which such adjustment or readjustment is based, including a statement of (i)
the consideration received or to be received by the Company for any Share Distribution issued or sold or deemed to have been issued,
(ii) the number of Shares outstanding or deemed to be outstanding, and (iii) the Exercise Price in effect immediately prior to
such issue or sale and as adjusted (subject, in all cases, to the Exercise Floor) and readjusted (if required by this Section 5)
on account thereof. The Company will forthwith mail a copy of each such report to the Warrant Holder and will, upon the written
request at any time of the Warrant Holder, furnish to such holder a like report setting forth the Exercise Price (subject, in all
cases, to the Exercise Floor) at the time in effect and showing in reasonable detail how it was calculated. The Company will also
keep copies of all such reports at its office and will cause the same to be available for inspection at such office during normal
business hours by the Warrant Holder or any prospective purchaser of this Warrant designated by the Warrant Holder.

 

(h)Subsequent Warrants. Irrespective
of any adjustments in the Exercise Price or the number of Warrant Shares issuable upon exercise of this Warrant, any successor
or replacement warrants issued theretofore or thereafter may continue to express the same Exercise Price (subject, in all cases,
to the Exercise Floor) per Share and number and kind of Warrant Shares as are stated in this Warrant.

 

    	10

    	 

    

 

(i)Disputes. Any dispute which
arises between the Warrant Holder and the Company with respect to the calculation of the adjusted Exercise Price (subject, in all
cases, to the Exercise Floor) or Warrant Shares issuable upon exercise shall be determined by the independent auditors of the Company,
and such determination shall be binding upon the Company and the holders of the Warrants and the Warrant Shares if made in good
faith and without manifest error.

 

(k)Other Actions Affecting Shares.

 

(i)Equitable Equivalent.
In case any event shall occur as to which the provisions of this Section 5 set forth above hereof are not strictly applicable but
the failure to make any adjustment would not, in the opinion of the Warrant Holder, fairly protect the purchase rights represented
by this Warrant in accordance with the essential intent and principles of this Section 5, then, in each such case, at the request
of the Warrant Holder, the Company shall appoint, at the Company’s expense, a firm of independent investment bankers of recognized
national standing (which shall be completely independent of the Company and shall be satisfactory to the holder or the Requisite
Holders), which shall give their opinion upon the adjustment, if any, on a basis consistent with the essential intent and principles
established in this Section 5, necessary to preserve, in an manner so as to reduce dilution (subject, in all cases, to the Exercise
Floor), the purchase rights represented by this Warrant. Upon receipt of such opinion, the Company will promptly mail a copy thereof
to the holder of this Warrant and shall make the adjustments (subject, in all cases, to the Exercise Floor) described therein.

 

(ii)No Avoidance. The Company
shall not, by amendment of its certificate of incorporation or by-laws or through any consolidation, merger, reorganization, transfer
of assets, 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 action as may be necessary or appropriate in order to protect the rights of the holder of this Warrant against
unlimited dilution (subject, in all cases, to the Exercise Floor) or other impairment as if the holder was a shareholder of the
Company entitled to the benefit of fiduciary duties afforded to shareholders under Delaware law.

 

(l)Calculation of Consideration Received.
The consideration for the issue or sale of any Share Distribution shall, irrespective of the accounting treatment of such consideration:

 

(i)insofar as it consists of cash,
be computed at the amount of cash actually received by the Company without reduction for any expenses paid or incurred by the Company
or any commissions or compensations paid or concessions or discounts allowed to underwriters, dealers or others performing similar
services in connection with such issue or sale;

 

(ii)insofar as it consists of property
(including securities) other than cash actually received by the Company, be computed at the Appraised Value thereof at the time
of such issue or sale; and

 

(iii)insofar as it consists neither
of cash nor of other property, be computed as having no value.

 

(m)Adjustment of Par Value. If
for any reason (including the operation of the adjustment provisions set forth in this Warrant), the Exercise Price (subject, in
all cases, to the Exercise Floor) on any date of exercise of this Warrant shall not be lawful and adequate consideration for the
issuance of the relevant Warrant Shares, then the Company shall take such steps as are necessary (including the amendment of its
certificate of incorporation so as to reduce the par value of the Shares) to cause such Exercise Price to be adequate and lawful
consideration on the date the payment thereof is due, but if the Company shall fail to take such steps, then the Company acknowledges
that the Warrant Holder shall have been damaged by the Company in an amount equal to an amount, which, when added to the total
Exercise Price (subject, in all cases, to the Exercise Floor) for the relevant Warrant Shares, would equal lawful and adequate
consideration for the issuance of such Warrant Shares, and the Company irrevocably agrees that if the Warrant Holder shall then
forgive the right to recover such damages from the Company, such forgiveness shall constitute, and Company shall accept such forgiveness
as, additional lawful consideration for the issuance of the relevant Warrant Shares.

 

    	11

    	 

    

 

(n)Appraisal.

 

(i)If the Requisite Holders shall,
for any reason whatsoever, disagree with the Company’s determination of the Appraised Value of a Share, then such holders
shall by notice to the Company (an “Appraisal Notice”) given within sixty (60) days after the Company
notifies the holders of such determination, elect to dispute such determination, and such dispute shall be resolved as set forth
in clause (ii) of this Section.

 

(ii)The Company shall within ten
(10) days after an Appraisal Notice shall have been given, engage an independent investment bank of national repute (the “Appraiser”)
selected by the Requisite Holders and retained pursuant to an engagement letter between the Company and the Appraiser with respect
to such valuation in form and substance reasonably acceptable to Requisite Holders, to make an independent determination of the
Appraised Value of a Share; such value shall be determined without deduction for (a) liquidity considerations, (b) minority shareholder
status, or (c) any liquidation or other preference or any right of redemption in favor of any other equity securities of the Company.
The costs of engagement of such investment bank for any such determination of Appraised Value shall be paid by the Company.

 

Section 6.Registration Rights and
Extension of Expiration Date. The Warrant Holder is entitled to the benefit of certain registration rights with respect to
the Warrant Shares as provided in the Registration Rights Agreement, dated as of June 5, 2013, by and between the Company and the
holders of Warrants (the “Registration Rights Agreement”), and any subsequent holder hereof shall be
entitled to such rights to the extent provided in the Registration Rights Agreement. If the Company fails to cause any Registration
Statement covering “Registrable Securities” (as that term is defined in the Registration Rights Agreement) to be declared
effective prior to the applicable dates set forth therein, or if any Event (as defined in the Registration Rights Agreement) specified
in Section 2(d) of the Registration Rights Agreement occurs (whether alone, or in combination with any other Event) and continues
for more than 20 consecutive days or 45 calendar days (which need not be consecutive days) in any 12 month period, then the Expiration
Date of this Warrant shall be extended one day for each day beyond the 20-day or 45-day limits, as the case may be, that the Event
continues.

 

Section 7.Transfer of Warrant.
The Warrant Holder upon transfer of the Warrant must deliver to the Company a duly executed Warrant Assignment in the form of Exhibit B
and upon surrender of this Warrant to the Company, the Company shall execute and deliver a new Warrant with appropriate changes
to reflect such Assignment, in the name or names of the assignee or assignees specified in the Warrant Assignment or other instrument
of assignment and, if the Warrant Holder’s entire interest is not being transferred or assigned, in the name of the Warrant
Holder, and upon the Company’s execution and delivery of such new Warrant, this Warrant shall promptly be cancelled; and
provided that any assignee shall have all of the rights of an Initial Holder hereunder. The Warrant Holder shall pay any
transfer tax imposed in connection with such assignment (if any). Any transfer or exchange of this Warrant shall be without charge
to the Warrant Holder (except as provided above with respect to transfer taxes, if any) and any new Warrant issued shall be dated
the date hereof.

 

    	12

    	 

    

 

Section 8.Assistance in Disposition
of Warrant or Warrant Shares. Notwithstanding any other provision herein, in the event that it becomes unlawful for the Warrant
Holder to continue to hold the Warrant, in whole or in part, or some or all of the Shares held by it, or restrictions are imposed
on any the Warrant Holder by any statute, regulation or governmental authority which, in the judgment of the Warrant Holder, make
it unduly burdensome to continue to hold the Warrant or such Shares, the Warrant Holder may sell or otherwise dispose of the Warrant
(subject to the restrictions on transfer provided in Section 7) or its Shares, and the Company agrees to provide reasonable
assistance to the Warrant Holder in disposing of the Warrant and such Shares in a prompt and orderly manner and, at the request
of the Warrant Holder, to provide (and authorize the Warrant Holder to provide) financial and other information concerning the
Company to any prospective purchaser of the Warrant or Shares owned by the Warrant Holder.

 

Section 9 Identity of Transfer
Agent. The Transfer Agent for the Common Stock is Corporate Stock Transfer, Inc. with a mailing address of 3200 Cherry Creek
Drive South #430, Denver, CO 80209. Upon the appointment of any subsequent transfer agent for the Shares, the Company will mail
to the Warrant Holder a statement setting forth the name and address of such transfer agent.

 

Section 10.Covenants. The
Company agrees that:

 

(a)[Reserved].

 

(b)[Reserved].

 

(c)[Reserved].

 

(d)Securities Filings; Rules 144
& 144A. The Company will (i) timely file any reports required to be filed by it under the Securities Act, the Exchange
Act or the rules and regulations adopted by the Commission thereunder, (ii) use its best efforts to cooperate with the Warrant
Holder and each holder of Warrant Shares in supplying such information concerning the Company as may be necessary for the Warrant
Holder or holder of Warrant Shares to complete and file any information reporting forms currently or hereafter required by the
Commission as a condition to the availability of an exemption from the Securities Act for the sale of any Warrants or Warrant Shares,
and (iii) take such further action as the Warrant Holder may reasonably request to the extent required from time to time to
enable the Warrant Holder to sell Warrant Shares without restriction and without registration under the Securities Act within the
limitation of the exemptions provided by Rule 144 or 144A under the Securities Act, as such Rules may be amended from time
to time, or any similar rule or regulation hereafter adopted by the Commission; provided that this subsection (d)
shall not require the Company to make any filing under the Securities Act or Exchange Act which the Company is not otherwise obligated
to make.

 

(e)Obtaining of Governmental Approvals
and Stock Exchange Listings. The Company will, at its own expense, (i) obtain and keep effective any and all permits,
consents and approvals of governmental agencies and authorities which may from time to time be required of the Company in order
to satisfy its obligations hereunder, and (ii) take all action which may be necessary so that the Warrant Shares, immediately
upon their issuance upon the exercise of the Warrants, will be listed on each securities exchange, if any, on which the Shares
are then listed.

 

(f)[Reserved].

 

(g)Structural Dilution. So long
as this Warrant remains outstanding, the Company shall not permit any of its Subsidiaries to issue, sell, distribute or otherwise
grant in any manner (including by assumption) any rights to subscribe for or to purchase, or any warrants or options for the purchase
of any equity securities of such Subsidiary or any securities convertible into or exchangeable for such equity securities (or any
rights to subscribe for or to purchase, or any warrants or options for the purchase of any such convertible or exchangeable securities),
whether or not immediately exercisable or exercisable prior to the Expiration Date or thereafter.

 

    	13

    	 

    

 

(h)Notices Of Corporate Action.
In the event of:

 

(i)any taking by the Company of
a record of the holders of any class of securities for the purpose of determining the holders thereof who are entitled to receive
any distribution, or any right to subscribe for, purchase or otherwise acquire any Shares or any other securities or property,
or to receive any other right, or

 

(ii)any capital reorganization of
the Company, any reclassification or recapitalization of the capital stock of the Company, any consolidation or merger involving
the Company and any other Person or any transfer of all or substantially all the assets of the Company to any other Person, or
any Corporate Reorganization, or

 

(iii)any voluntary or involuntary
dissolution, liquidation or winding-up of the Company, or

 

(iv)any issuance of any Shares,
Convertible Security or Option by the Company,

 

the Company will mail to the Warrant Holder
a notice specifying (i) the date or expected date on which any such record is to be taken for the purpose of such dividend, distribution
or right, and the amount and character of such dividend, distribution or right, (ii) the date or expected date on which any such
reorganization, reclassification, recapitalization, consolidation, merger, transfer, dissolution, liquidation or winding-up is
to take place, (iii) the time, if any such time is to be fixed, as of which the holders of record of Shares (or other securities
under Section 5(d)) shall be entitled to exchange their Shares (or other securities under Section 5(d)) for the securities or other
property deliverable upon such reorganization, reclassification, recapitalization, consolidation, merger, transfer, dissolution,
liquidation or winding-up and a description in reasonable detail of the transaction and (iv) the date of such issuance, together
with a description of the security so issued and the consideration received by the Company therefor. Such notice shall be mailed
at least twenty (20) Business Days prior to the date therein specified.

 

Section 11.Lost, Mutilated or
Missing Warrants. Upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction or
mutilation of any Warrant, and, in the case of loss, theft or destruction, upon receipt of indemnification satisfactory to the
Company (in the case of an Initial Holder its unsecured, unbonded agreement of indemnity or affidavit of loss shall be sufficient)
or, in the case of mutilation, upon surrender and cancellation of the mutilated Warrant, the Company shall execute and deliver
a new Warrant of like tenor and representing the right to purchase the same aggregate number of Warrant Shares.

 

Section 12.Waivers; Amendments.
Any provision of this Warrant may be amended or waived with (but only with) the written consent of the Company and the Requisite
Holders; provided that no such amendment or waiver shall, without the written consent of the Company and the Warrant Holder,
(a) change the number of Warrant Shares issuable upon exercise of the Warrant or the Exercise Price, (b) shorten the
Expiration Date, or (c) amend, modify or waive the provisions of this Section or the definition of “Requisite Holders.”
Any amendment or waiver effected in compliance with this Section shall be binding upon the Company and the Warrant Holder. The
Company shall give prompt notice to the Warrant Holder of any amendment or waiver effected in compliance with this Section. No
failure or delay of the Company or the Warrant Holder in exercising any power or right hereunder shall operate as a waiver thereof,
nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such
a right or power, preclude any other or further exercise thereon or the exercise of any other right or power. No notice or demand
on the Company in any case shall entitle the Company to any other or future notice or demand in similar or other circumstances.
The rights and remedies of the Company and the Warrant Holder hereunder are cumulative and not exclusive of any rights or remedies
which it would otherwise have.

 

    	14

    	 

    

 

Section 13.Miscellaneous.

 

(a)Shareholder Rights. The Warrant
shall not entitle any Warrant Holder, prior to the exercise of the Warrant, to any voting rights as a shareholder of the Company.

 

(b)Expenses. The Company shall
pay all reasonable expenses of the Warrant Holder, including reasonable fees and disbursements of counsel, in connection with the
preparation of the Warrant, any waiver or consent hereunder or any amendment or modification hereof (regardless of whether the
same becomes effective), or the enforcement of the provisions hereof; provided that the Company shall not be required to
pay any expenses of the Warrant Holder arising solely in connection with a transfer of the Warrant.

 

(c)Successors and Assigns. All
the provisions of this Warrant by or for the benefit of the Company or the Warrant Holder shall bind and inure to the benefit of
their respective successors and assigns.

 

(d)Severability. In case any
one or more of the provisions contained in this Warrant shall be invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein shall not in any way be affected or impaired thereby.
The parties shall endeavor in good faith negotiations to replace the invalid, illegal or unenforceable provisions with valid provisions
the economic effect of which comes as close as possible to that of the invalid, illegal or unenforceable provisions.

 

(e)Notices. Any notice or other
communication hereunder shall be in writing and shall be sufficient if sent by first-class mail or courier, postage prepaid, and
addressed as follows: (a) if to the Company, addressed to the Company at its address for notices as set forth below its signature
hereon or any other address as the Company may hereafter notify to the Warrant Holder and(b) if to the Warrant Holder, addressed
to such address as the Warrant Holder may hereafter from time to time notify to the Company for the purposes of notice hereunder.

 

(f)Equitable Remedies. Without
limiting the rights of the Company and the Warrant Holder to pursue all other legal and equitable rights available to such party
for the other parties’ failure to perform its obligations hereunder, the Company and the Warrant Holder each hereto acknowledge
and agree that the remedy at law for any failure to perform any obligations hereunder would be inadequate and that each shall be
entitled to specific performance, injunctive relief or other equitable remedies in the event of any such failure.

 

(g)Continued Effect. Rights and
benefits conferred on the holders of Warrant Shares pursuant to the provisions hereof (including Section 6) shall continue
to inure to the benefit of, and shall be enforceable by, such holders, notwithstanding the surrender of the Warrant to, and its
cancellation by, the Company upon the full or partial exercise or repurchase hereof.

 

    	15

    	 

    

 

(i)Governing Law. THIS WARRANT
SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK, EXCEPT AS OTHERWISE REQUIRED
BY MANDATORY PROVISIONS OF LAW.

 

(j)Section Headings. The section
headings used herein are for convenience of reference only and shall not be construed in any way to affect the interpretation of
any provisions of the Warrant.

 

    	16

    	 

    

 

IN WITNESS WHEREOF, the Company has caused
this Warrant to be duly executed by its authorized signatory as of the day and year first above written.

 

	 	Bacterin International Holdings, Inc., a Delaware corporation
	 	 
	 	By __________________________________
	 	Name: John Gandolfo
	 	Title: CFO and Interim Co-CEO
	 	 
	 	Address for Notices:
	 	 
	 	Bacterin International Holdings, Inc.
	 	 
	 	664 Cruiser Lane
	 	 
	 	Belgrade, MT 59714
	 	 
	 	Attn: General Counsel
	 	 
	 	jgilpin@bacterin.com
	 	 
	 	Telephone: (406) 388-0480
	 	Facsimile: (406) 388-1354

 

    	1

    	 

    

 

Exhibit A to Warrant

 

Form of Notice of Exercise

 

____________________,20___

 

To: Bacterin International Holdings, Inc.

 

Reference is made to the Warrant dated __________.
Terms defined therein are used herein as therein defined.

 

The undersigned, pursuant to the provisions
set forth in the Warrant, hereby irrevocably elects and agrees to purchase _______ Shares, and makes payment herewith in full therefor
at the Exercise Price of $_______________ in the following form: ___________________________________________________________.

 

[If the number of Shares as to which the
Warrant is being exercised is less than all of the Shares purchasable thereunder, the undersigned hereby requests that a new Warrant
representing the remaining balance of the Shares be registered in the name of ______________, whose address is: _______________________________.]

 

The undersigned hereby represents that it
is exercising the Warrant for its own account or the account of an Affiliate for investment purposes and not with the view to any
sale or distribution and that the Warrant Holder will not offer, sell or otherwise dispose of the Warrant or any underlying Warrant
Shares in violation of applicable securities laws.

 

	 	[NAME OF WARRANT HOLDER]
	 	 
	 	By _________________________
	 	Name:
	 	Title:
	 	 
	 	[ADDRESS OF WARRANT HOLDER]

 

    	 

    	 

    

 

Exhibit B to Warrant

 

Form of Warrant Assignment

 

Reference is made to the Warrant dated ____________,
issued by [_______________________]. Terms defined therein are used herein as therein defined.

 

FOR VALUE RECEIVED ____________________
(the “Assignor”) hereby sells, assigns and transfers all of the rights of the Assignor as set forth in such Warrant,
with respect to the number of Warrant Shares covered thereby as set forth below, to the Assignee(s) as set forth below:

 

Number of Warrant Shares

 

	Name(s) of Assignee(s)	Address(es)	Number of Warrant Shares
	 	 	 
	 	 	 

 

All notices to be given by the Company to
the Assignor as Warrant Holder shall be sent to the Assignee(s) at the above listed address(es), and, if the number of Shares being
hereby assigned is less than all of the Shares covered by the Warrant held by the Assignor, then also to the Assignor.

 

In accordance with Section 7 of the
Warrant, the Assignor requests that the Company execute and deliver a new Warrant or Warrants in the name or names of the assignee
or assignees, as is appropriate, or, if the number of Shares being hereby assigned is less than all of the Shares covered by the
Warrant held by the Assignor, new Warrants in the name or names of the assignee or the assignees, as is appropriate, and in the
name of the Assignor.

 

The undersigned represents that the Assignee
has represented to the Assignor that the Assignee is acquiring the Warrant for its own account or the account of an Affiliate for
investment purposes and not with the view to any sale or distribution, and that the Assignee will not offer, sell or otherwise
dispose of the Warrant or the Warrant Shares except under circumstances as will not result in a violation of applicable securities
laws.

 

Dated: _________________, 20___

 

	 	[NAME OF ASSIGNOR]
	 	 
	 	By _________________________
	 	Name:
	 	Title:
	 	 
	 	[ADDRESS OF ASSIGNOR]

 

    	 

    	 

    

 

APPENDIX A

 

Black Scholes Option Pricing formula to be used when calculating
the value of each new warrant to purchase one share in the Acquirer shall be: 

 

CAcq
= SAcqe-λ(TAcq-tAcq)N(d1)
– KAcqe-r(TAcq-tAcq)N(d2),
where

 

CAcq
= value of each warrant to purchase one share in the Acquirer

 

SAcq
= price of Acquirer’s stock as determined by reference to the average of the closing prices on the securities exchange
or Nasdaq Global Market over the 20-day period ending three trading days prior to the closing of the Corporate Reorganization
described in Section 5(d) if the Acquirer’s stock is then traded on such exchange or system, or the average of the closing
bid or sale prices (whichever is applicable) in the over-the-counter market over the 20-day period ending three trading days prior
to the closing of the Corporate Reorganization if the Acquirer’s stock is then actively traded in the over-the-counter market,
or the then most recently completed financing if the Acquirer’s stock is not then traded on a securities exchange or system
or in the over-the-counter market.

 

TAcq
= expiration date of new warrants to purchase shares in the Acquirer = TCorp

 

tAcq
= date of issue of new warrants to purchase shares in the Acquirer

 

TAcq-tAcq
= time until warrant expiration, expressed in years

 

σ = volatility = annualized standard deviation
of daily log-returns (using a 262-day annualization factor) of the Acquirer’s stock price on the securities exchange or Nasdaq
Global Market over a 20-day trading period, determined by the Warrant Holders, that is within the 100-day trading period
ending on the trading day immediately after the public announcement of the Corporate Reorganization described in Section 5(d) if
the Acquirer’s stock is then traded on such exchange or system, or the annualized standard deviation of daily-log returns
(using a 262-day annualization factor) of the closing bid or sale prices (whichever is applicable) in the over-the-counter market
over a 20-day trading period, determined by the Warrant Holder, that is within the 100-day trading period ending on the trading
day immediately after the public announcement of the Corporate Reorganization if the Acquirer’s stock is then actively traded
in the over-the-counter market, or 0.6 (or 60%) if the Acquirer’s stock is not then traded on a securities exchange or system
or in the over-the-counter market.

 

N = cumulative normal distribution function

 

d1 = (ln(SAcq/KAcq)
+ (r-λ+σ2/2)(TAcq-tAcq))
÷ (σ√(TAcq-tAcq))

 

ln = natural logarithm 

 

λ = dividend rate of the Acquirer for the most
recent 12-month period at the time of closing of the Corporate Reorganization.

 

KAcq
= strike price of new warrants to purchase shares in the Acquirer = the greater of (a) the Exercise Floor and (b) KCorp
* (SAcq / SCorp)

 

r = annual yield, as reported by Bloomberg at time tAcq,
of the United States Treasury security measuring the nearest time TAcq

 

d2 = d1- σ√(TAcq-tAcq)

 

    	 

    	 

    

 

Appendix
B

 

Black Scholes Option Pricing formula to be used when calculating
the value of each Warrant to purchase one share in the Company shall be: 

 

CCorp
= SCorpe-λ(TCorp-tCorp)N(d1)
– KCorpe-r(TCorp-tCorp)N(d2),
where

 

CCorp
= value of each Warrant to purchase one share in the Company

 

SCorp
= price of Company stock as determined by reference to the average of the closing prices on the securities exchange or Nasdaq
Global Market over the 20-day period ending three trading days prior to the closing of the Corporate Reorganization described
in Section 5(d) if the Company’s stock is then traded on such exchange or system, or the average of the closing bid or sale
prices (whichever is applicable) in the over-the-counter market over the 20-day period ending three trading days prior to the closing
of the Corporate Reorganization if the Company’s stock is then actively traded in the over-the-counter market, or the then
most recently completed financing if the Company’s stock is not then traded on a securities exchange or system or in the
over-the-counter market.

 

TCorp
= expiration date of Warrants to purchase shares in the Company

 

tCorp
= date of public announcement of transaction

 

TCorp-tCorp
= time until Warrant expiration, expressed in years 

 

σ = volatility = the annualized standard deviation
of daily log-returns (using a 262-day annualization factor) of the Company’s stock price on the securities exchange or Nasdaq
Global Market over a 20-day trading period, determined by the Warrant Holders, that is within the 100-day trading period
ending on the trading day immediately after the public announcement of the Corporate Reorganization described in Section 5(d) if
the Company’s stock is then traded on such exchange or system, or the annualized standard deviation of daily-log returns
(using a 262-day annualization factor) of the closing bid or sale prices (whichever is applicable) in the over-the-counter market
over a 20-day trading period, determined by the Warrant Holder, that is within the 100-day trading period ending on the trading
day immediately after the public announcement of the Corporate Reorganization if the Company’s stock is then actively traded
in the over-the-counter market, or 0.6 (or 60%) if the Company’s stock is not then traded on a securities exchange or system
or in the over-the-counter market.

 

N = cumulative normal distribution function

 

d1 = (ln(SCorp/KCorp)
+ (r-λ+σ2/2)(TCorp-tCorp))
÷ (σ√(TCorp-tCorp))

 

ln = natural logarithm 

 

λ = dividend rate of the Company for the most
recent 12-month period at the time of closing of the Corporate Reorganization.

 

KCorp
= strike price of warrant

 

r = annual yield, as reported by Bloomberg at time tCorp,
of the United States Treasury security measuring the nearest time TCorp

 

d2 = d1- σ√(TCorp-tCorp)

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