Document:

EX-10.2

 Exhibit 10.2 

CONFIDENTIALITY, NON-COMPETITION AGREEMENT AND 

NON-SOLICITATION AGREEMENT 

FRANKLIN FINANCIAL NETWORK, INC. 

CONFIDENTIALITY, NON-COMPETITION AGREEMENT AND
NON-SOLICITATION AGREEMENT 
 SARAH MEYERROSE 

This Confidentiality, Non-Competition, and Non-Solicitation Agreement (this “Agreement”) is entered into as of this 21st day of
June, 2016, between Franklin Financial Network, Inc. (the “Company”), a Tennessee corporation and Sarah Meyerrose (“Executive”). 

WHEREAS, Executive is an employee of the Company, who has been employed to provide guidance, leadership, and direction in the growth,
management, and development of the Company and has learned trade secrets, confidential procedures and information, and technical and sensitive plans of the Company, 

WHEREAS, the Company desires to restrict, after the Executive’s Termination of Employment (as defined below) with the Company, the
Executive’s availability to other companies or entities that compete with the Company, 
 NOW THEREFORE, in consideration of
these premises, the mutual promises and undertakings set forth in this Agreement, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Executive and the Company hereby agree as follows: 

1. Administration of this Agreement. 

(a) Administrator duties. This Agreement shall be administered by the Company’s board of directors or by such committee or person
as the board shall appoint (the “Administrator”). The Executive may not be a member of the Administrator. The Administrator shall have the discretion and authority to (i) make, amend, interpret, and enforce all appropriate rules and
regulations for the administration of this Agreement and (ii) decide or resolve any and all questions that may arise, including interpretations of this Agreement. 

(b) Agents. In the administration of this Agreement, the Administrator may employ agents and delegate to them such administrative
duties as it sees fit (including acting through a duly appointed representative) and may from time to time consult with counsel, who may be counsel to the Company. 

(c) Binding effect of decisions. The decision or action of the Administrator concerning any question arising out of the administration,
interpretation, and application of this Agreement and the rules and regulations promulgated hereunder shall be final and conclusive and binding upon all persons having any interest in this Agreement. 

(d) Indemnity of Administrator. The Company shall indemnify and hold harmless the members of the Administrator against any and all
claims, losses, damages, 

  
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expenses, or liabilities arising from any action or failure to act with respect to this Agreement, except in the case of willful misconduct by the Administrator or any of its members. No
individual shall be liable while acting as Administrator for any action or determination made in good faith regarding this Agreement, and any such individual shall be entitled to indemnification and reimbursement in the manner provided in the
Company’s Charter and Bylaws and under applicable law. 
 (e) Information. To enable the Administrator to perform its functions,
the Company shall supply full and timely information to the Administrator on all matters relating to the date and circumstances of the Termination of Employment of the Executive and such other pertinent information as the Administrator may
reasonably require. 
 (f) Action by the Administrator. In addition to acting at a meeting in accordance with applicable laws, any
action of the Administrator concerning this Agreement may be taken by a written instrument signed by the Administrator (including, if the Company’s board of directors or a board committee serves as the Administrator, by written consent in
accordance with Tennessee law and the Charter and Bylaws of the Company, and any such action so taken by written consent shall be effective as if it had been taken by a majority of the members at a meeting duly called and held). 

2. Definitions 
 (a)
Affiliate shall mean the Company and any entity that directly, or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with the Company. 

(b) Change in Control shall mean: (i) a reorganization, merger, consolidation or sale of all or substantially all of the assets of
the Company, or any similar transaction, in any case in which the shareholders of the Company prior to such transaction hold less than a majority of the voting power of the resulting entity; or (ii) individuals who constitute the Incumbent
Board (as herein defined) of the Company cease for any reason to constitute a majority thereof. For these purposes, “Incumbent Board” means the Board of Directors of the Company on the date hereof, provided that any person becoming a
director subsequent to the date hereof whose election was approved by a voting of a majority of the directors comprising the Incumbent Board, or whose nomination for election by members or shareholders was approved by the same nominating committee
serving under an Incumbent Board, shall be considered as though he were a member of the Incumbent Board. 
 (c) Code shall mean the
Internal Revenue Code of 1986, as amended, or any successor statute, rule or regulation of similar effect. 
 (d) Confidential
Information shall mean all business and other information relating to the business of the Company, including without limitation, technical or nontechnical data, programs, methods, techniques, processes, financial data, financial plans, product
plans, and lists of actual or potential customers, which (i) derives economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other Persons,

  
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and (ii) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy or confidentiality. Such information and compilations of information shall be
contractually subject to protection under this Agreement whether or not such information constitutes a trade secret and is separately protectable at law or in equity as a trade secret. Confidential Information does not include confidential business
information, which does not constitute a trade secret under applicable law one year after any expiration or termination of this Agreement. 

(e) Customer shall mean any individual, joint venturer, entity of any sort, or other business partner of the Company with, for, or to
whom the Company has provided financial products or services during the final two years of the Executive’s employment with the Company, or any individual, joint venturer, entity of any sort, or business partner whom the Company has identified
as a prospective customer of financial products or services within the final year of the Executive’s employment with the Company. 

(f) Disability or Disabled means the Executive (i) is unable to engage in any substantial gainful activity by reason of any
medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months or (ii) is by reason of any medically determinable physical or mental
impairment which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, receiving income replacement benefits for a period of not less than three months under an accident and health plan
covering employees of the Company. 
 (g) Financial products or services shall mean any product or service that a financial
institution or a financial holding company could offer by engaging in any activity that is financial in nature or incidental to such a financial activity under Section 4(k) of the Bank Holding Company Act of 1956 and that is offered by the
Company, or an affiliate, on the date of the Executive’s Termination of Employment, including but not limited to banking activities and activities that are closely related and a proper incident to banking, or other products or services of the
type in which the Executive was involved during the Executive’s employment with the Company. 
 (h) Person shall mean any
individual, corporation, limited liability company, company, partnership, joint venture, association, joint-stock company, trust, unincorporated organization or other entity. 

(i) Specified Employee means an employee who at the time of Termination of Employment is a key employee of the Company, if any stock of
the Company is publicly traded on an established securities market or otherwise. For purposes of this Agreement, an employee is a key employee if the employee meets the requirements of Code Section 416(i)(1)(A)(i), (ii), or (iii) (applied
in accordance with the regulations thereunder and disregarding Section 416(i)(5)) at any time during the 12-month period ending on December 31 (the “identification period”). If the employee is a key employee during an
identification period, the employee is treated as a key employee for purposes of this Agreement during the twelve (12) month period that begins on the first day of April following the close of the identification period. 

  
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 (j) Termination of Employment with the Company means that the Executive shall have ceased
to be employed by the Company for reasons other than death, excepting a leave of absence approved by the Company. Whether a termination of employment has occurred is determined based on whether the facts and circumstances indicate that the Company
and the Executive reasonably anticipated that no further services would be performed after a certain date or that the level of bona fide services the Executive would perform after such date (whether as an employee or as an independent contractor)
would permanently decrease to no more than twenty percent (20%) of the average level of bona fide services performed (whether as an employee or an independent contractor) over the immediately preceding twenty-four (24) month period (or the
full period of services to the Company if the Executive has been providing services to the Company less than twenty-four (24) months). 

(k) Termination for Cause. The Company may terminate the Executive’s employment for Cause, upon written notice to the Executive
which notice shall specify the reason for termination. In the event of termination for Cause, the Executive shall not be entitled to any further payment of benefits under the Agreement other than salary accruing up to the date of termination. For
purposes of the Agreement, “Cause” shall mean; (i) the willful or repeated failure by the Executive to perform her duties hereunder or failure to abide by the policies set forth in the Employee Handbook, after at least one warning in
writing from the Company identifying any such failure occurring not less than forty-five (45) days prior to the date notice of termination is given by the Company pursuant to this section; (ii) the willful misconduct of the Executive in
the performance of her duties hereunder; (iii) conviction of a crime (other than a minor traffic violation); (iv) use of alcohol or other drugs which interferes with the performance by the Executive of Executive’s duties;
(v) excessive absenteeism, other than for illness, after at least one warning in writing from the Company; (vi) the unauthorized disclosure or use of any confidential information or proprietary data of the Company or its Affiliates;
(vii) the happening of any event or existence of any circumstances which would prevent the Executive from serving as an officer of the Company under the Tennessee or applicable Federal banking regulations; (viii) Executive’s conduct
that brings public discredit on, or injures the reputation of, Company, in Company’s reasonable opinion. 
 (l) Voluntary
Termination shall mean the termination by Executive of Executive’s employment, which is not for Cause. 
 3. Term 

The term of this Agreement shall commence upon the date this Agreement is executed by all parties and will continue for two years. The term of
this Agreement will automatically renew each day after the Effective Date for one additional day so that the term of the Agreement shall always be two years unless (i) terminated by the Employer and replaced by a mutually agreed upon
arrangement; or (ii) the Board provides written notice of non-renewal to Executive; or, (iii) Executive provides written notice of non-renewal to Company. Each party shall negotiate in good faith the terms and conditions for any renewal of
the Term or any Renewal Term of this Agreement. 

  
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 4. Covenants Against Competition, Solicitation, or Disclosure of Confidential Information.

 (a) Competition. In recognition of the considerations described in this Agreement, the Executive shall not, either separately,
jointly, or in association with others, directly or indirectly, as an agent, employee, owner, partner, shareholder, or otherwise, compete with the Company or establish, engage in, or become interested in any business, trade, or occupation that
competes with the Company in the financial products or services industry in any county in any of the States of the United States in which the Company’s business is currently being conducted or is being conducted when the Executive’s
Termination of Employment occurs. The Company and the Executive acknowledge that during the term of the Executive’s employment the Executive has acquired special and confidential knowledge regarding the operations of the Company. Furthermore,
although not a term or condition of this Agreement, the Company and the Executive acknowledge that the Executive’s services have been used and are being used by the Company in executive, managerial, and supervisory capacities throughout the
areas in which the Company conducts business. Executive acknowledges that the non-compete restrictions contained herein are reasonable and fair in scope and necessary to protect the legitimate business interests of the Company. 

(b) Solicitation. In recognition of the considerations described in this Agreement, the Executive shall not (i) directly or
indirectly solicit or attempt to solicit any customer of the Company to accept or purchase financial products or services of the same nature, kind or variety currently being provided to the customer by the Company or being provided to the customer
by the Company when the Executive’s Termination of Employment occurs, (ii) directly or indirectly influence or attempt to influence any customer, joint venturer, or other business partner of the Company to alter that person or
entity’s business relationship with the Company in any way, and (iii) accept the financial products or services business of any customer or provide financial products or services to any customer on behalf of anyone other than the Company.
In addition, the Executive shall not solicit or attempt to solicit and shall not encourage or induce in any way any employee, joint venturer, or business partner of the Company to terminate an employment or contractual relationship with the Company,
and shall not hire any person employed by Company during the two-year period immediately before the Executive’s Termination of Employment or any person employed by the Company during the term of this covenant. 

(c) Disclosure of Confidential Information. In recognition of the considerations described in this Agreement, the Executive shall not
reveal to any person, firm, or corporation any Confidential Information of any nature concerning the Company or the business of the Company, or affiliates. The covenant in this Section 4(c) does not prohibit disclosure required by an order of a
court having jurisdiction or a subpoena from an appropriate governmental agency or disclosure made by the Executive in the ordinary course of business and within the scope of the Executive’s authority. 

(d) Duration; no impact on existing obligations under law or contract. The covenants in this Section 4 shall apply throughout the
twelve (12) month period immediately following the executive’s Termination of Employment whether or not the Company has engaged the services of the Executive pursuant to an agreement to provide consulting services upon the Executive’s
Termination of Employment with the Company. The twelve (12) month durational 

  
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period referenced herein shall be tolled and shall not run during any such time that the Executive is in breach of this Agreement and/or in violation of any of the covenants contained herein, and
once tolled hereunder shall not begin to run again until such time as all such breach and/or violations have ceased. The Executive acknowledges and agrees that nothing in this Agreement is intended to or shall have any impact on the Executive’s
obligations as an officer or employee of the Company to refrain from competing against, soliciting customers, officers, or employees of, or disclosing Confidential Information of the Company while the Executive is serving as an officer or employee
of the Company or thereafter, whether the Executive’s obligations arise under applicable law or under an employment agreement or otherwise. 

(e) Remedies. The Executive acknowledges and agrees that remedies at law for the Executive’s breach of the covenants contained
herein are inadequate and that for violation of the covenants contained herein, in addition to any and all legal and equitable remedies that may be available, the covenants may be enforced by an injunction in a suit in equity without the necessity
of proving actual damage, and that a temporary injunction may be granted immediately upon the commencement of any such suit, and without notice. The parties hereto intend that the covenants contained in this Section 4 shall be deemed to be a
series of separate covenants, one for each county of each state in which the Company does business. If in any judicial proceeding a court refuses to enforce any or all of the separate covenants, the unenforceable covenants shall be deemed eliminated
from the provisions hereof for the purposes of that proceeding to the extent necessary to permit the remaining separate covenants to be enforced. Furthermore, if in any judicial proceeding a court refuses to enforce any covenant because of the
covenant’s duration or geographic scope, the covenant shall be construed to have only the maximum duration or geographic scope permitted by law. 

(f) Forfeiture of payments under this Agreement. If the Executive breaches any of the covenants in this Section 4, the
Executive’s right to any of the payments specified in Section 5 after the date of the breach shall be forever forfeited and the right of the Executive’s designated beneficiary or estate to any payments under this Agreement shall
likewise be forever forfeited. This forfeiture is in addition to and not instead of any injunctive or other relief that may be available to the Company. The Executive further acknowledges and agrees that any breach of any of the covenants in this
Section 4 shall be deemed a material breach by the Executive of this Agreement. 
 5. Non-Compete Payment. 

(a) Payment. In consideration of the Executive’s covenant not to compete as described in Section 4 hereto and subject to the
limitations outlined in Section 5(c) and Section 22, upon the Executive’s Termination of Employment for any reason, the Company shall pay to the Executive an amount equal to the aggregate of one (1) times the annual rate of base
salary then being paid to the Executive, plus one (1) times the average of the past three years cash incentive bonus pay, which amount shall be paid in twelve (12) equal monthly payments beginning on the first day of the month following
the Executive’s Termination of Employment. 
 (b) Potential six-month delay under Section 409A. If, when Termination of
Employment occurs, the Executive is a specified employee within the meaning of Section 409A of the Code, and if the non-competition payment under this Section 5 would be considered 

  
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deferred compensation under Section 409A of the Code, and finally if an exemption from the six-month delay requirement of Section 409A(a)(2)(B)(i) of the Code is not available, the
Executive’s non-competition payments for the first six months following Termination of Employment shall be paid to the Executive in a single lump sum on the first day of the seventh month after the month in which the Executive’s
Termination of Employment occurs. 
 (c) Death, Disability and For Cause. Notwithstanding anything herein to the contrary, no amounts
are payable under this Agreement in the event of the Executive’s Termination of Employment as a result of death, disability or for Cause. Further, all payments under this Agreement shall cease upon Executive’s death. 

6. Claims Procedure. 
 A
person or beneficiary who has not received benefits under this Agreement that he believes should be paid shall make a claim for such benefits by submitting to the Administrator a written claim for the benefits. The claim must state with
particularity the determination desired by the claimant. All determinations and decisions made by the Administrator regarding claims for benefits under this Agreement will be final, conclusive and binding on all persons, including the Company, the
Executive, her estate, and beneficiaries. 
 7. Return of Records and Property. 

Upon the Executive’s Termination of Employment for any reason, or at any time upon the Company’s request, the Executive shall
promptly deliver to the Company: all Company and Affiliate records and all Company and Affiliate property in the Executive’s possession or the Executive’s control, including without limitation manuals, books, blank forms, documents,
letters, memoranda, notes, notebooks, reports, printouts, computer disks, computer tapes, source codes, data, tables or calculations, and all copies thereof; documents that in whole or in part contain any Confidential Information of the Company or
its Affiliates and all copies thereof; and keys, access cards, access codes, passwords, credit cards, personal or laptop computers, telephones, PDAs, smart phones, and other electronic equipment belonging to the Company or an Affiliate. 

8. Remedies. 
 Executive
agrees that if Executive fails to fulfill Executive’s obligations under this Agreement, including, without limitation, the Non-Competition and Non-Solicitation obligations set forth in paragraph 4, the damages to the Company or any of its
Affiliates would be very difficult or impossible to determine. Therefore, in addition to any other rights or remedies available to the Company at law, in equity or by statute, Executive hereby consents to the specific enforcement by the Company of
this Agreement through an injunction or restraining order issued by an appropriate court, without the necessity of proving actual damages, and Executive hereby waives as a defense to any equitable action the allegation that the Company has an
adequate remedy at law. The provisions of this paragraph shall not diminish the right of the Company to claim and recover damages or to obtain any equitable remedy in addition to injunctive relief to which the Company may otherwise be entitled. The
Executive understands and agrees that the Executive will also be responsible for all costs and attorney’s fees incurred by the Company in enforcing any of the provisions of this Agreement including, but not limited to, expert witness fees and
deposition costs. 

  
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 9. Payments and Funding. 

Any payment under this Agreement shall be independent of and in addition to those under any other plan, program, or agreement that may be in
effect between the parties hereto or any other compensation payable to the Executive by the Company. 
 10. Assignment of Rights;
Spendthrift Clause. 
 None of the Executive, the Executive’s estate, or the Executive’s beneficiary shall have any right to
sell, assign, transfer, pledge, attach, encumber, or otherwise convey the right to receive any payment hereunder. To the extent permitted by law, benefits payable under this Agreement shall not be subject to the claim of any creditor of the
Executive, the Executive’s estate, or the Executive’s designated beneficiary or subject to any legal process by any creditor of the Executive, the Executive’s estate, or the Executive’s designated beneficiary. 

11. Binding Effect. 

This Agreement shall bind the Executive, the Company, and their beneficiaries, survivors, executors, successors and assigns, administrators,
and transferees. 
 12. Successors; Binding Agreement. 

By an assumption agreement in form and substance satisfactory to the Executive, the Company shall require any successor (whether direct or
indirect, by purchase, merger, consolidation, or otherwise) to all or substantially all of the business or assets of the Company to expressly assume and agree to perform this Agreement in the same manner and to the same extent that the Company would
be required to perform this Agreement had no succession occurred. 
 13. Amendment of Agreement. 

This Agreement may not be altered or amended except by a written agreement signed by the Company and by the Executive. However, if the Company
determines to its reasonable satisfaction that an alteration or amendment of this Agreement is necessary or advisable so that the Agreement complies with the Code or any other applicable tax law, then upon written notice to Executive the Company may
unilaterally amend this Agreement in such manner and to such an extent as the Company reasonably considers necessary or advisable to ensure compliance with the Code or other applicable tax law. Nothing in this Section 13 shall be deemed to
limit the Company’s right to terminate this Agreement at any time and without stated cause. 
 14. Interpretation. 

Caption headings and subheadings herein are included solely for convenience of reference and shall not affect the meaning or interpretation of
any provision of this Agreement. Words used in the singular in this Agreement shall include the plural and words used in the masculine shall include the feminine. 

  
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 15. Severability. 

If any provision of this Agreement is held invalid, such invalidity shall not affect any other provision of this Agreement not held invalid,
and each such other provision shall continue in full force and effect to the full extent consistent with law. If any provision of this Agreement is held invalid in part, such invalidity shall not affect the remainder of the provision not held
invalid, and the remainder of such provision together with all other provisions of this Agreement shall continue in full force and effect to the full extent consistent with law. 

16. Governing Law, Venue, and Waiver of Right to Jury Trial. 

This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Tennessee, except to the extent
preempted by the laws of the United States of America. The Executive and the Company agree that the exclusive venue for resolution of any disputes regarding or arising out of this Agreement or the Executive’s employment with the Company shall
be the state and federal courts located in Williamson County, Tennessee. The Executive and the Company further agree to waive any right to a jury trial with respect to any disputes regarding or arising out of this Agreement or the Executive’s
employment with the Company. The Executive and the Company each acknowledge and agree that this selection of venue and waiver of the right to a jury trial is knowingly, freely, and voluntarily given, is made after opportunity to consult with counsel
of their choosing about this Agreement and its provisions, and is in the best interests of each party hereto. 
 17. Entire
Agreement. 
 This Agreement constitutes the entire agreement between the Company and the Executive concerning the subject matter. No
rights are granted to the Executive under this Agreement other than those specifically set forth. 
 18. No Guarantee of Employment.

 This Agreement is not an employment policy or contract. It does not give the Executive the right to remain an employee of the Company nor
does it interfere with the Company’s right to discharge the Executive. It also does not require the Executive to remain an employee or interfere with the Executive’s right to terminate employment at any time. 

19. Tax Withholding. 
 If
taxes are required by the Code or other applicable tax law to be withheld by the Company from payments under this Agreement, the Company shall withhold any taxes that are required to be withheld. 

20. Notices. 
 All
notices, requests, demands, and other communications hereunder shall be in writing and shall be deemed to have been duly given if delivered by hand or mailed, certified or registered mail, return receipt requested, with postage prepaid, to the
following addresses or to such other address as either party may designate by like notice. If to the Company, notice shall be 

  
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given to the board of directors or to such other or additional person or persons as the Company shall have designated to the Executive in writing. If to the Executive, notice shall be given
to the Executive at the Executive’s address appearing on the Company’s records, or to such other additional person or persons as the Executive shall have designated to the Company in writing. 

21. Compliance With Code Section 409A. 

The Company and the Executive intend that their exercise of authority or discretion under this Agreement shall comply with Section 409A
of the Code. Notwithstanding anything herein to the contrary in this Agreement, to the extent that any benefit under this Agreement that is nonqualified deferred compensation (within the meaning of Section 409A of the Code) is payable upon
Executive’s Termination of Employment, such payment(s) shall be made only upon Executive’s “Separation from Service” pursuant to the default definition in Treasury Regulation Section 1.409A-1(h). 

22. General Limitations. 

(a) Removal. Despite any contrary provision of this Agreement, if the Executive is removed from office or permanently prohibited from
participating in the Company’s affairs by an order issued under Section 8(e) (4) or (g) (1) of the Federal Deposit Insurance Act, 12 U.S.C. 1818(e) (4) or (g) (1), all obligations of the Company under this
Agreement shall terminate as of the effective date of the order. 
 (b) Default. Despite any contrary provision of this Agreement, if
the Company’s subsidiary bank is in “default” or “in danger of default”, as those terms are defined in of Section 3(x) of the Federal Deposit Insurance Act, 12 U.S.C. 1813(x), all obligations under this Agreement shall
terminate. 
 (c) FDIC Open-Bank Assistance. All obligations under this Agreement shall be terminated, except to the extent
determined that continuation of the contract is necessary for the continued operation of the Company’s subsidiary bank, at the time the Federal Deposit Insurance Corporation enters into an agreement to provide assistance to or on behalf of the
Company under the authority contained in Section 13(c) of the Federal Deposit Insurance Act. 12 U.S.C. 1823(c). 
 IN
WITNESS WHEREOF, the Executive and a duly authorized officer of the Company have executed this Non-Competition Agreement as of the date first written above. 

 

							
	EXECUTIVE:	 		 	FRANKLIN FINANCIAL NETWORK, INC.
				
	  
	 		 	By:	 	 
	Sarah Meyerrose	 		 	  Richard E. Herrington
		 		 	  Its: Chief Executive Officer

  
 10Exhibit 4.25

 

NEITHER THIS SECURITY NOR THE SECURITIES
FOR WHICH THIS SECURITY IS EXERCISABLE HAVE 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 AS EVIDENCED BY A LEGAL OPINION OF COMPANY COUNSEL TO THE TRANSFEROR
TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. 

 

COMMON SHARE PURCHASE WARRANT

 

OCULUS
INNOVATIVE SCIENCES, INC.

 

	No. ____	 	 
	Warrant Shares: ____	 	Issue Date: March 31, 2016

 

THIS COMMON SHARE PURCHASE
WARRANT (the “Warrant”) certifies that, for value received ____________ or his 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 180 days from the date hereof (the “Initial Exercise Date”) and on or prior to the close of business
on March 31, 2019 (the “Termination Date”) but not thereafter, to subscribe for and purchase from Oculus Innovative
Sciences, Inc. (the “Company”), up to _____ shares of the Company’s common stock (the “Common
Stock”) (as subject to adjustment hereunder, the “Warrant Shares”). 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). This Warrant is issued pursuant
to that certain Financial Advisory Agreement, dated as of March 31, 2016, between the Company and Dawson James Securities, Inc.
(the “Financial Agreement”).

 

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

 

“Affiliate”
means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common
control with a Person, as such terms are used in and construed under Rule 405 under the Securities Act.

 

“Business
Day” means any day except any Saturday, any Sunday, any day which is a federal legal holiday in the United States or
any day on which banking institutions in the State of New York are authorized or required by law or other governmental action to
close.

 

“Commission”
means the United States Securities and Exchange Commission.

 

“Common
Stock Equivalents” means any securities of the Company or any subsidiaries of the Company that 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.

 

 

 

    	 	1	 

     

    

 

“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

 

“Person”
means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability
company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.

 

“Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.

 

“Trading
Day” means a day on which the Common Stock is traded on a Trading Market.

 

“Trading
Market” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on
the date in question: the NYSE MKT, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, or the
New York Stock Exchange (or any successors to any of the foregoing).

 

“Transfer
Agent” means Computershare Inc., the current transfer agent of the Company and any successor transfer agent of the Company.

 

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
and, within three (3) Trading Days of the date said Notice of Exercise is delivered to the Company, unless this Warrant is exercised
pursuant to Section 2(c) below, payment of the aggregate Exercise Price of the shares thereby purchased by wire transfer or cashier’s
check drawn on a United States bank. 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 three (3) 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.

 

 

 

    	 	2	 

     

    

 

b)              
Exercise Price. The exercise price per share of the Common Stock under this Warrant shall be $1.00, subject to adjustment
hereunder (the “Exercise Price”).

 

c)              
Cashless Exercise. This Warrant may also be exercised, at any time, in whole or in part, 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 Closing
Sale Price of the Common Stock on the date of the applicable Notice of Exercise relating to the exercise of this Warrant by means
of a “cashless exercise;”

 

(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 same characteristics of the Warrants being exercised with respect to transferability
under Rule 144 of the Securities Act. The Company agrees not to take any position contrary to this Section 2(c).

 

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 there is an effective registration statement permitting the issuance of the Warrant
Shares to or resale of the Warrant Shares by Holder or the Warrant Shares may be sold without limitation or restriction pursuant
to Rule 144 of the Securities Act, 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 three (3) Trading Days after
the delivery to the Company of the Notice of Exercise (such date, the “Warrant Share Delivery Date”). Upon
delivery of the Notice of Exercise the Holder shall be deemed for all corporate purposes to have become the holder of record of
the Warrant Shares with respect to which this Warrant has been exercised, irrespective of the date of delivery of the Warrant
Shares; provided payment of the aggregate Exercise Price is received within three Trading Days of delivery of the Notice of Exercise.
If the Company fails for any reason to deliver to the Holder the Warrant Shares subject to a Notice of Exercise by the Warrant
Share Delivery Date, the Company shall be subject to the payments set forth in Section 2(d)(iv) below. In no event will the Company
be required to net cash settle the Warrant. The Company agrees to maintain a transfer agent that is a participant in the FAST
program so long as this Warrant remains outstanding and exercisable.

 

 

 

    	 	3	 

     

    

 

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.

 

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, at its election, either pay a cash adjustment in respect of such final fraction in an amount equal
to such fraction multiplied by the Exercise Price or round up to the next whole share.

 

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 that 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. The provisions of this paragraph 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 paragraph 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)              
Subsequent Rights Offerings. In addition to any adjustments pursuant to Section 3(a) above, if at any time the Company
grants, issues or sells any Common Stock Equivalents or rights to purchase stock, warrants, securities or other property pro rata
to the record holders of any class of shares of Common Stock (the “Purchase Rights”), then upon any exercise
of this Warrant, the Holder will be entitled to acquire the Holder will be entitled to acquire, upon the terms applicable to such
Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired if the Holder had held the number of shares
of Common Stock acquirable upon such exercise of this Warrant (without regard to any limitations on exercise hereof, including
without limitation, the Beneficial Ownership Limitation) immediately before the date on which a record is taken for the grant,
issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of shares of
Common Stock are to be determined for the grant, issue or sale of such Purchase Rights (provided, however, to the extent that the
Holder’s right to participate in any such Purchase Right would result in the Holder exceeding the Beneficial Ownership Limitation,
then the Holder shall not be entitled to participate in such Purchase Right to such extent (or beneficial ownership of such shares
of Common Stock as a result of such Purchase Right to such extent) and such Purchase Right to such extent shall be held in abeyance
for the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership
Limitation).

 

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,
upon any exercise of this Warrant, 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 such 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). The foregoing shall not apply to the payment of cash dividends in
such amounts as are consistent with prior cash dividend payments made during the past three fiscal years as set forth in the Company’s
SEC Reports.

 

 

    	 	7	 

     

    

 

 

e)              
Fundamental Transaction. If, at any time while this Warrant is outstanding, (i) the Company, directly or indirectly,
in one or more related transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company,
directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially
all of its assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange
offer (whether by the Company or another Person) is completed pursuant to which holders of Common Stock are permitted to sell,
tender or exchange their shares for other securities, cash or property and has been accepted by the holders of 50% or more of the
outstanding Common Stock, (iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification,
reorganization or recapitalization 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, or (v) the Company, directly or indirectly, in one or more
related transactions consummates a stock or share purchase agreement or other business combination (including, without limitation,
a reorganization, recapitalization, spin-off or scheme of arrangement) with another Person or group of Persons whereby such other
Person or group acquires more than 50% of the outstanding shares of Common Stock (not including any shares of Common Stock held
by the other Person or other Persons making or party to, or associated or affiliated with the other Persons making or party to,
such stock or share purchase agreement or other business combination) (each a “Fundamental Transaction”), then,
upon any subsequent exercise of this Warrant, the Holder shall have the right to receive, for each Warrant Share that would have
been issuable upon such exercise immediately prior to the occurrence of such Fundamental Transaction, at the option of the Holder
(without regard to any limitation in Section 2(e) on the exercise of this Warrant), the number of shares of Common Stock of the
successor or acquiring corporation or of the Company, if it is the surviving corporation, and any additional consideration (the
“Alternate Consideration”) receivable as a result of such Fundamental Transaction by a holder of the number
of shares of Common Stock for which this Warrant is exercisable immediately prior to such Fundamental Transaction (without regard
to any limitation in Section 2(e) on the exercise of this Warrant). For purposes of any such exercise, the determination of the
Exercise Price shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration
issuable in respect of one share of Common Stock in such Fundamental Transaction, and the Company shall apportion the 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 a Fundamental Transaction, then the Holder shall be given the same choice as to the Alternate Consideration it receives upon
any exercise of this Warrant following such Fundamental Transaction. The Company shall cause any successor entity in a Fundamental
Transaction in which the Company is not the survivor (the “Successor Entity”) to assume in writing all of the
obligations of the Company under this Warrant and the other Transaction Documents in accordance with the provisions of this Section
3(e) pursuant to written agreements prior to such Fundamental Transaction and shall, at the option of the Holder, deliver to the
Holder in exchange for this Warrant a security of the Successor Entity evidenced by a written instrument substantially similar
in form and substance to this Warrant which is exercisable for a corresponding number of shares of capital stock of such Successor
Entity (or its parent entity) equivalent to the shares of Common Stock acquirable and receivable upon exercise of this Warrant
(without regard to any limitations on the exercise of this Warrant) prior to such Fundamental Transaction, and with an exercise
price which applies the exercise price hereunder to such shares of capital stock (but taking into account the relative value of
the shares of Common Stock pursuant to such Fundamental Transaction and the value of such shares of capital stock, such number
of shares of capital stock and such exercise price being for the purpose of protecting the economic value of this Warrant immediately
prior to the consummation of such Fundamental Transaction). Upon the occurrence of any such Fundamental Transaction, the Successor
Entity shall succeed to, and be substituted for (so that from and after the date of such Fundamental Transaction, the provisions
of this Warrant and the other Transaction Documents referring to the “Company” shall refer instead to the Successor
Entity), and may exercise every right and power of the Company and shall assume all of the obligations of the Company under this
Warrant and the other Transaction Documents with the same effect as if such Successor Entity had been named as the Company herein.

 

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.

 

    	 	8	 

     

    

 

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.

 

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, unless the Company issues a press release
or makes a filing with the SEC with the foregoing information within the time period set forth below, the Company shall cause
to be delivered by facsimile or email to the Holder at its last facsimile number or email address as it shall appear upon the
Warrant Register of the Company, at least 20 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.

 

 

 

    	 	9	 

     

    

 

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
three (3) 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.

 

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.

 

 

 

    	 	10	 

     

    

 

Section 5.Miscellaneous.

 

a)              
No Rights as Stockholder Until Exercise. 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), except as expressly
set forth in Section 3.

 

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.

 

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).

 

 

    	 	11	 

     

    

 

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)              
Governing Law; Jurisdiction. This Warrant shall be governed by and construed in accordance with the laws of the State
of New York applicable to agreements made and to be fully performed therein. Any disputes that arise under this Warrant, even after
the termination of this Warrant, will be heard only in the state or federal courts located in the City of New York, State of New
York. The parties hereto expressly agree to submit themselves to the jurisdiction of the foregoing courts in the City of New York,
State of New York. The parties hereto expressly waive any rights they may have to contest the jurisdiction, venue or authority
of any court sitting in the City and State of New York.

 

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

 

g)              
Non-waiver 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, 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.

 

 

 

    	 	12	 

     

    

 

h)              
Notices. Any notice, request or other document required or permitted to be given or delivered to the Holder by the
Company shall be sent to the Holder’s address set forth in the Company’s records.

 

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 holders holding Warrants to acquire a majority of the Warrant Shares issuable pursuant to the Warrants that were
originally issued pursuant to the Securities Purchase Agreement.

 

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)

 

 

 

    	 	13	 

     

    

 

 

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.

 

 

 

	 	
        OCULUS INNOVATIVE
        SCIENCES, inc.

	 	 
	 	 
	 	
        By: /s/ Robert Miller                    

        Name: Robert Miller

        Title: Chief Financial Officer

	 	 

 

 

 

 

 

 

 

 

 

 

    	 	14	 

     

    

NOTICE OF EXERCISE

 

To:OCULUS
INNOVATIVE SCIENCES, inc.

 

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. Payment
shall take the form of $________ (at the rate of $____ per Warrant Share) in lawful money of the United States.

 

OR

 

The undersigned
hereby elects to convert its right to purchase ______ Warrant Shares of the Company pursuant to the terms of the attached Warrant,
as determined in accordance with the following formula:

 

	 	X	=	Y(A-B)	 
	A	 
	 

                                                         Where,
	 	 	 
	 	X	=	The number of Warrant Shares to be issued to Holder;
	 	Y	=	The number of Warrant Shares for which the Warrant is being exercised;
	 	A	=	The Closing Sale Price of the Common Stock on the date of this Notice of Exercise, which is equal to $_____; and
	 	B	=	The Exercise Price which is equal to $______ per share
	 	 	 	 	 	 	 

 

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: _________________________________________________________________________

 

 

 

 

    	 	15	 

     

    

EXHIBIT A

 

 

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)

	 	 
	Phone Number:	 
	 	 
	Email Address:	 
	 	 
	Dated: _______________ __, ______	 
	Holder’s Signature:                                                          	 
	Holder’s Address:                                                           	 

 

 

 

 

 

 

 

 

    	 	16

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