Document:

Exhibit
4.3

     

    Form
of Class A Warrant

     

    NEITHER
THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH
THESE SECURITIES ARE EXERCISABLE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR APPLICABLE STATE SECURITIES
LAWS.  THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED
OR ASSIGNED IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE
SECURITIES UNDER THE SECURITIES ACT, OR (B) IF REASONABLY REQUESTED BY THE
COMPANY, AN OPINION OF COUNSEL REASONABLY ACCEPTABLE TO THE COMPANY THAT
REGISTRATION IS NOT REQUIRED UNDER SAID THE SECURITIES ACT.

     

    ARNO
THERAPEUTICS, INC.

     

    CONVERTIBLE
PREFERRED STOCK/COMMON STOCK  PURCHASE WARRANT

    (CLASS
A)

     

    
      
        	
                Warrant
      No. A-[___] 

              	
                Dated:  [________],
      2010

              

      

    

     

    Arno
Therapeutics, Inc., a Delaware corporation (the “Company”), hereby certifies
that, for value received, [________________________], or its registered assigns
(the “Holder”), is
entitled, subject to the terms and conditions of this Warrant (this “Warrant”):

     

    (i) prior
to the time that all shares of the Company’s Series A Convertible Preferred
Stock, par value $0.0001 per share (the “Preferred Stock”), the terms,
rights, preferences and privileges of which are set forth in that Certificate of
Designation filed with the Secretary of State of Delaware on September 3, 2010
(the “Certificate of
Designation”), shall have automatically converted into Common Stock in
accordance with the terms of such Certificate of Designation (the “Automatic Conversion”), to
purchase from the Company, up to a total of [________] shares of Preferred Stock
(each such share, a “Preferred
Warrant Share” and all such shares, the “Preferred Warrant Shares”) at
an exercise price initially equal to the then-effective Conversion Price (as
defined in the Certificate of Designation) of the Preferred Stock (the “PW Exercise Price”);
or

     

    (ii) from
and after the Automatic Conversion, to purchase from the Company, up to a total
number of shares of common stock of the Company, $0.0001 par value per share
(the “Common Stock”),
equal to the number of shares of Common Stock that would have been issuable on
the Automatic Conversion of the Preferred Warrant Shares described above, less
the number of Preferred Warrant Shares already issued pursuant to an actual
exercise of this Warrant prior to the Automatic Conversion, had such net number
of Preferred Warrant Shares been issued and outstanding at the time of the
Automatic Conversion (each such share, a “Common Warrant Share,” and all such
shares, the “Common Warrant
Shares”), at an exercise price initially equal to the Conversion Price of
the Preferred Stock in effect on the date of the Automatic Conversion, and
thereafter as adjusted from time to time as provided in Section 9 hereof (the
“CW Exercise
Price”).

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    For the avoidance of doubt, and to
further clarify the anti-dilutive protections afforded to the Holder of this
Warrant prior to the Automatic Conversion, upon the occurrence of a dilutive
event prior to the Automatic Conversion, the Company and the Holder acknowledge
and agree that the Conversion Price, and thereby the number of shares of Common
Stock into which each Preferred Warrant Share may be converted, shall be
adjusted in accordance with the terms of the Certificate of
Designation.

     

    Except as
otherwise specified herein, (i) at any time that any of the Preferred
Stock  purchased by the Holder has not been converted to Common Stock,
references in this Warrant to “Warrant Shares” shall mean
Preferred Warrant Shares and to “Exercise Price” shall mean PW
Exercise Price; and (ii) at any time that all of the Preferred Stock has been
converted to Common Stock, references in this Warrant to “Warrant Shares” shall
mean  Common Warrant Shares and to “Exercise Price” shall mean CW
Exercise Price.

     

    This
Warrant is one of a series of similar warrants (collectively, the “Warrants”) issued pursuant to
that certain Securities Purchase and Registration Rights Agreement, dated as of
September 3, 2010, by and among the Company and the Purchaser(s) identified
therein (the “Purchase
Agreement”).

     

    1.           Definitions.  In
addition to the terms defined elsewhere in this Warrant, capitalized terms that
are not otherwise defined herein have the meanings given to such terms in the
Purchase Agreement.

     

    2.           Registration of
Warrant.  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.

     

    3.           Registration of
Transfers.

     

    (a)           Notwithstanding
anything to the contrary contained herein, this Warrant and the Warrant Shares
shall not be sold or transferred unless either (i) they first shall have been
registered under the Securities Act, or (ii) such sale or transfer shall be
exempt from the registration requirements of the Securities Act and the Company
shall have been furnished with an opinion of legal counsel, reasonably
satisfactory to the Company, to the effect that such sale or transfer is exempt
from the registration requirements of the Securities
Act.  Notwithstanding the foregoing, no registration or opinion of
counsel shall be required for (i) a transfer by a Holder which is an entity to a
wholly owned subsidiary of such entity, a transfer by a Holder which is a
partnership to a partner of such partnership or a retired partner of such
partnership or to the estate of any such partner or retired partner, or a
transfer by a Holder which is a limited liability company to a member of such
limited liability company or a retired member or to the estate of any such
member or retired member, provided that the
transferee in each case agrees in writing to be subject to the terms of this
Section 3, or
(ii) a transfer made in accordance with Rule 144 under the Securities
Act.

    
      
         

      

      
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    (b)           The
Company shall register the transfer of any portion of this Warrant in the
Warrant Register, upon surrender of this Warrant, with the Form of Assignment
attached hereto as Annex A duly
completed and signed, to the transfer agent or to the Company at its address
specified herein.  Upon any such registration or transfer, a new
warrant to purchase Preferred Stock and/or Common Stock, as the case may be, in
substantially the form of this Warrant (any such new warrant, a “New Warrant”), evidencing the
portion of this Warrant so transferred shall be issued to the transferee and a
New Warrant evidencing the remaining portion of this Warrant not so transferred,
if any, shall be issued to the transferring Holder.  The acceptance of
the New Warrant by the transferee thereof shall be deemed the acceptance by such
transferee of all of the rights and obligations of a holder of a
Warrant.

     

    4.           Exercise and Duration of
Warrants.

     

    (a)           Subject
to the terms and conditions of this Warrant, this Warrant shall be exercisable
by the registered Holder at any time and from time to time on or after the date
hereof, up to and including the Expiration Date (as defined
below).  Subject to paragraphs (b) and (c) of this Section 4, on
[________], 2013, at 6:30 P.M., New York City time, the portion of this Warrant
not exercised prior thereto shall be and become void and of no value (the “Expiration
Date”).

     

    (b)           A
Holder may exercise this Warrant by delivering to the Company (i) an exercise
notice, in the form attached hereto as Annex B (the “Exercise Notice”),
appropriately completed and duly signed along with the Warrant, and
(ii) payment of the Exercise Price for the number of Warrant Shares, as to
which this Warrant is being exercised (which may take the form of a “cashless
exercise” if so indicated in the Exercise Notice), and the date such items are
delivered to the Company (as determined in accordance with the notice provisions
hereof) is an “Exercise
Date.”  Execution and delivery of the Exercise Notice shall
have the same effect as cancellation of the original Warrant and issuance of a
New Warrant evidencing the right to purchase the remaining number of Warrant
Shares.

     

    (c)           Insufficient Authorized
Shares.  If at any time while this Warrant is outstanding, the
Company does not have a sufficient number of authorized and unreserved shares of
Preferred Stock or Common Stock to satisfy its obligation to reserve for
issuance upon exercise of this Warrant and Warrants of like tenor at least a
number of shares of Preferred Stock and Common Stock equal to 120% (the “Required Reserve Amount”) of
the number of shares of Preferred Stock and Common Stock as shall from time to
time be necessary to effect the exercise of all of the Warrants of like tenor
then outstanding (an “Authorized Share Failure”),
then the Company shall immediately take all action necessary to increase the
Company’s authorized shares of Preferred Stock and Common Stock to an amount
sufficient to allow the Company to reserve the Required Reserve Amount for the
Warrants of like tenor then outstanding.  Without limiting the
generality of the foregoing sentence, as soon as practicable after the date of
the occurrence of an Authorized Share Failure, but in no event later than sixty
(60) days after the occurrence of such Authorized Share Failure, the Company
shall hold a meeting of its stockholders for the approval of an increase in the
number of authorized shares of Preferred Stock and Common Stock.  In
connection with such meeting, the Company shall provide each stockholder with a
proxy or information statement, to the extent required by applicable law, and
shall use its reasonable best efforts to solicit its stockholders’ approval of
such increase in authorized shares of Preferred Stock and Common Stock and to
cause its board of directors to recommend to the stockholders that they approve
such proposal.

    
      
         

      

      
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    5.           Delivery of Warrant
Shares.

     

    (a)           The
Holder shall not be required to physically surrender this Warrant unless this
Warrant is being exercised in full.  To effect exercises hereunder,
the Holder shall duly execute and deliver to the Company at its address for
notice set forth herein, an Exercise Notice in the form of Annex B hereto, along
with the Warrant Share Exercise Log in the form of Annex C hereto, and
shall pay the Exercise Price, multiplied by the number of Warrant Shares that
the Holder intends to purchase hereunder.  The Company shall promptly
(but in no event later than three (3) Trading Days after the date of exercise)
issue or cause to be issued and cause to be delivered to or upon the written
order of the Holder a certificate for the Warrant Shares issuable upon such
exercise.  The Company shall, upon request of the Holder, and
subsequent to the date on which a registration statement covering the resale of
the Warrant Shares has been declared effective by the SEC and provided such
registration statement continues to be effective and the prospectus included
therein continues to remain current, use its best efforts to deliver
Warrant Shares hereunder electronically through the Depository Trust Corporation
or another established clearing corporation performing similar
functions.  If by the third (3rd)
Trading Day after exercise of this Warrant, the Company fails to deliver the
required number of Warrant Shares, the Holder will have the right to rescind the
exercise.  If by the third (3rd)
Trading Day after exercise, the Company fails to deliver the required number of
Warrant Shares, and if after such third Trading Day (3rd) and
prior to the receipt of such Warrant Shares, the Holder purchases (in an open
market transaction or otherwise) shares of Common Stock to deliver in
satisfaction of a sale by the Holder of Warrant Shares which the Holder
anticipated receiving upon such exercise (a “Buy In”), then the Company
shall (i) pay in cash to the Holder the amount 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 (A) the
number of Warrant Shares that the Company was required to deliver to the Holder
in connection with the exercise at issue by (B) the closing bid price of the
Common Stock on the exercise date and (ii) 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 or deliver to the Holder the number of
shares of Warrant Shares that would have been issued had the Company timely
complied with its exercise and delivery obligations hereunder.  The
Holder shall provide the Company written notice indicating the amounts payable
to the Holder in respect of the Buy In.

     

    (b)           This
Warrant is exercisable, either in its entirety or, from time to time, for a
portion of at least 25,000 Warrant Shares.  Upon surrender of this
Warrant following one or more partial exercises, the Company shall issue or
cause to be issued, at its expense, a new Warrant evidencing the right to
purchase the remaining number of Warrant Shares.

    
      
         

      

      
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    (c)           The
Company’s obligations to issue and deliver Warrant Shares in accordance with the
terms hereof are absolute and unconditional, irrespective of any action or
inaction by the Holder to enforce the same, any waiver or consent with respect
to any provision hereof, the recovery of any judgment against any Person or any
action to enforce the same, or any setoff, counterclaim, recoupment, limitation
or termination, or any breach or alleged breach by the Holder or any other
Person of any obligation to the Company or any violation or alleged violation of
law by the Holder or any other Person, and irrespective of any other
circumstance which might otherwise limit such obligation of the Company to the
Holder in connection with the issuance of Warrant Shares.  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 certificates representing shares of Common Stock upon
exercise of the Warrant as required pursuant to the terms hereof.

     

    6.           Charges, Taxes and
Expenses.  Initial issuance and delivery of certificates for
shares of Preferred Stock or Common Stock, as the case may be, upon exercise of
this Warrant shall be made without charge to the Holder for any issue or
transfer tax, withholding tax, transfer agent fee or other incidental tax or
expense in respect of the issuance of such certificates, all of which taxes and
expenses shall be paid by the Company; provided, however, that the
Company shall not be required to pay any tax which may be payable in respect of
any transfer involved in the registration of any certificates for Warrant Shares
or Warrants in a name other than that of the Holder.

     

    7.           Replacement of
Warrant.  If this Warrant is mutilated, lost, stolen or
destroyed, the Company shall issue or cause to be issued in exchange and
substitution for and upon cancellation hereof, or in lieu of and substitution
for this Warrant, a new Warrant, but only upon receipt of evidence reasonably
satisfactory to the Company of such loss, theft or destruction and customary and
reasonable bond or indemnity, if requested.  Applicants for a new
Warrant under such circumstances shall also comply with such other reasonable
regulations and procedures and pay such other reasonable third-party costs as
the Company may prescribe.

     

    8.           Reservation of Warrant
Shares.  The Company covenants that it will at all times
reserve and keep available out of the aggregate of its authorized but unissued
and otherwise unreserved Preferred Stock and Common Stock, solely for the
purpose of enabling it to issue Warrant Shares upon exercise of this Warrant as
herein provided, the number of Warrant Shares that are then issuable and
deliverable upon the exercise of this entire Warrant, free from preemptive
rights or any other contingent purchase rights of persons other than the Holder
(after giving effect to the adjustments and restrictions of Section 9, if
any).  The Company covenants that all Warrant Shares so issuable and
deliverable shall, upon issuance and the payment of the applicable Exercise
Price in accordance with the terms hereof, be duly and validly authorized,
issued and fully paid and nonassessable.  The Company will take all
such action as may be necessary to assure that such shares of Preferred Stock or
Common Stock, as the case may be, may be issued as provided herein without
violation of any applicable law or regulation, or of any requirements of any
securities exchange or automated quotation system upon which the Preferred Stock
or the Common Stock may be listed.  The Company will notify its
transfer agent for the Preferred Stock and for the Common Stock of the
reservation of shares of Preferred Stock and Common Stock as required under this
provision.

     

    9.           Certain
Adjustments.  The CW Exercise Price and number of Common
Warrant Shares issuable upon exercise of this Warrant are subject to adjustment
from time to time as set forth in this Section 9 following
any Automatic Conversion. The Company and the Holder acknowledge and agree that
comparable adjustments in the PW Exercise Price and number of Preferred Warrant
Shares for the events and matters described below are to be addressed by the
terms of the Certificate of Designation relating to the Series A Preferred Stock
prior to any Automatic Conversion.

     

    
      
         

      

      
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    (a)           Stock Dividends and
Splits.  If after the date hereof, the number of outstanding
shares of Common Stock is increased by a stock dividend payable in shares of
Common Stock or by a split-up of shares of Common Stock or other similar event,
then, on the effective date thereof, the number of Warrant Shares issuable on
exercise of this Warrant shall be increased in proportion to such increase in
outstanding shares and the then applicable Exercise Price shall be
correspondingly decreased.

     

    (b)           Aggregation of
Shares.  If after the date hereof, the number of outstanding
shares of Common Stock is decreased by a consolidation, combination or
reclassification of shares of Common Stock or other similar event, then, upon
the effective date of such consolidation, combination or reclassification, the
number of Warrant Shares issuable on exercise of this Warrant shall be decreased
in proportion to such decrease in outstanding shares and the then applicable
Exercise Price shall be correspondingly increased.

     

    (c)           Replacement of Securities
Upon Reorganization, etc.  If after the date hereof any capital
reorganization or reclassification of the Common Stock of the Company, or
consolidation or merger of the Company with another corporation, or the sale of
all or substantially all of its assets to another corporation or other similar
event (each, a “Fundamental
Transaction”) shall be effected, then, as a condition of such Fundamental
Transaction, lawful and fair provision shall be made whereby the Holder of this
Warrant shall thereafter have the right to purchase and receive, upon the basis
and upon the terms and conditions specified in this Warrant and in lieu of the
shares of Common Stock of the Company immediately theretofore purchasable and
receivable upon the exercise of the rights represented thereby, such shares of
stock, securities, or assets as may be issued or payable with respect to or in
exchange for the number of outstanding shares of such Common Stock equal to the
number of shares of such stock immediately theretofore purchasable and
receivable upon the exercise of the rights represented by this Warrant, had such
Fundamental Transaction not taken place and in such event appropriate provision
shall be made with respect to the rights and interests of the Holder of this
Warrant to the end that the provisions hereof (including, without limitation,
provisions for adjustments of the Exercise Price and of the number of shares
purchasable upon the exercise of this Warrant) shall thereafter be applicable,
as nearly as may be in relation to any share of stock, securities, or assets
thereafter deliverable upon the exercise hereof.  The Company shall
not effect any such Fundamental Transaction unless prior to the consummation
thereof the successor corporation (if other than the Company) resulting from
such Fundamental Transaction, or the corporation purchasing such assets in a
Fundamental Transaction, shall assume by written instrument executed and
delivered to the Holder of this Warrant the obligation to deliver to the Holder
of this Warrant such shares of stock, securities, or assets as, in accordance
with the foregoing provisions, such holders may be entitled to
purchase.

     

    (d)           Adjustment of Exercise Price
Upon Issuance of Additional Shares of Common Stock.  In the
event the Company shall at any time after the Automatic Conversion issue shares
of Common Stock (the “Additional Shares of Common
Stock”), other than Exempt Issuances (as defined below), while any
portion of this Warrant remains outstanding, without consideration or for a
consideration per share less than the Exercise Price, then the Exercise Price
shall be reduced, concurrently with such issue, to a price (calculated to the
nearest one-hundredth of a cent), determined in accordance with the following
formula:

    
      
         

      

      
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    EP2 = EP1 * (A + B)
÷ (A + C).

     

    For
purposes of the foregoing formula, the following definitions shall
apply:

     

    (a)           “EP2” shall
mean the Exercise Price in effect immediately after such issue of Additional
Shares of Common Stock;

     

    (b)           “EP1” shall
mean the Exercise Price in effect immediately prior to such issue of Additional
Shares of Common Stock;

     

    (c)           “A”
shall mean the number of shares of Common Stock outstanding immediately prior to
such issue of Additional Shares of Common Stock (treating for this purpose as
outstanding all shares of Common Stock issuable upon exercise, conversion or
exchange of Common Stock Equivalents (as defined below) outstanding immediately
prior to such issue;

     

    (d)           “B”
shall mean the number of shares of Common Stock that would have been issued if
such Additional Shares of Common Stock had been issued at a price per share
equal to EP1
(determined by dividing the aggregate consideration received by the Company in
respect of such issue by EP1);
and

     

    (e)           “C”
shall mean the number of such Additional Shares of Common Stock issued in such
transaction.

     

    For
purposes hereof, “Exempt
Issuances” shall mean the issuance of (i) an aggregate number of Common
Stock or Common Stock Equivalents (as defined below, and whether in the form of
shares of Common Stock or options), not to exceed in the aggregate after any
issuance, ten percent (10%) of all then issued and outstanding Common Stock
Equivalents held by all persons, to employees, officers and/or independent
directors pursuant to the Corporation’s 2005 Stock Option Plan or such other
equity incentive plan approved by the Corporation’s stockholders, provided, in either
case, such issuances are approved by the Corporation’s Board of Directors,
including approval of at least 50% of the Corporation’s independent directors
and all three Investor Directors; (ii) shares of Common Stock or Common Stock
Equivalents issued as part of the purchase consideration in mergers or
acquisitions of businesses or assets, provided, such
issuances are approved by the Corporation’s Board of Directors, including
approval of all three Investor Directors; (iii) shares of Common Stock issuable
upon the exercise or conversion of Common Stock Equivalents outstanding as of
the Original Issuance Date; (iii) shares of Common Stock issuable upon the
exercise or conversion of Common Stock Equivalents outstanding as of the date
this Warrant was originally issued; (iv) Common Stock issued to the Company’s
stockholders upon any stock split, stock dividend or similar event with respect
to the Common Stock; (v)  up to 500,000 shares of Common Stock or
Common Stock Equivalents issued to banks, equipment lessors or other financial
institutions, or to real property lessors, pursuant to a debt financing,
equipment leasing or real property leasing transaction approved by the Board of
Directors of the Company, provided, such
issuances are approved by the Corporation’s Board of Directors, including
approval of all three Investor Directors; (vi) shares of Common Stock or Common
Stock Equivalents issued as a dividend or distribution on the Preferred Stock;
or (vii)  shares of Common Stock actually issued upon the exercise,
conversion or exchange of Common Stock Equivalents, in each case provided such
issuance is pursuant to the terms of such Common Stock Equivalents and that an
adjustment to the Exercise Price was either made or not required to be made in
accordance with Section 9(d) hereof.

    
      
         

      

      
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    (e)           Adjustment of Exercise Price
Upon Issuance of Common Stock Equivalents.  In the event the
Company shall at any time after the Closing Date issue any Convertible Security
(defined as evidences of indebtedness, shares of stock or other securities which
are or may be at any time convertible into or exchangeable for shares of Common
Stock) or warrant, option or other right to subscribe for or purchase any shares
of Common Stock or any Convertible Security (“Common Stock Equivalents”),
while any portion of this Warrant remains outstanding, other than Exempt
Issuances, and the price per share for which Additional Shares of Common Stock
may be issuable thereafter pursuant to such Common Stock Equivalents shall be
less than the Exercise Price, or if, after any such issuance of Common Stock
Equivalents, the price per share for which Additional Shares of Common Stock may
be issuable thereafter is amended, and such price as so amended shall be less
than the Exercise Price, then the Exercise Price upon each such issuance or
amendment shall be adjusted as provided in Section 9(d) above, on the basis that
Additional Shares of Common Stock issuable pursuant to such Common Stock
Equivalents shall be deemed to have been issued (whether or not such Common
Stock Equivalents are actually then exercisable, convertible or exchangeable in
whole or in part) as of the earlier of (i) the date on which the Company shall
enter into a firm contract for the issuance of such Common Stock Equivalents, or
(ii) the date of actual issuance of such Common Stock Equivalents.  No
adjustment of the Exercise Price shall be made under this Section 9(e) upon the
issuance of any Convertible Security which is issued pursuant to the exercise of
any warrants or other subscription or purchase rights therefore, if any
adjustment shall previously have been made in the Exercise Price then in effect
upon the issuance of such warrants or other rights pursuant to this Section
9(e).

     

    (f)           Computation of
Consideration.  The consideration received by the Company shall
be deemed to be the following: to the extent that any Additional Shares of
Common Stock or any Common Stock Equivalents shall be issued for a cash
consideration, the consideration received by the Company therefore; or, if such
Additional Shares of Common Stock or Common Stock Equivalents are offered by the
Company for subscription, the subscription price; or, if such Additional Shares
of Common Stock or Common Stock Equivalents are sold to underwriters or dealers
for public offering without a subscription offering, the initial public offering
price, in any such case excluding any amounts paid or receivable for accrued
interest or accrued dividends and without deduction of any compensation,
discounts, commissions, or expenses paid or incurred by the Company for or in
connection with the underwriting thereof or otherwise in connection with the
issue thereof.  The consideration for any Additional Shares of Common
Stock issuable pursuant to any Common Stock Equivalents shall be the
consideration received by the Company for issuing such Common Stock Equivalents,
plus the additional consideration payable to the Company upon the exercise,
conversion or exchange of such Common Stock Equivalents.  In case of
the issuance at any time of any Additional Shares of Common Stock or Common
Stock Equivalents in payment or satisfaction of any dividend upon any class of
stock other than Common Stock, the Company shall be deemed to have received for
such Additional Shares of Common Stock or Common Stock Equivalents a
consideration equal to the amount of such dividend so paid or
satisfied.  In any case in which the consideration to be received or
paid shall be other than cash, the Board of Directors of the Company shall
determine in good faith the fair market value of such consideration and promptly
notify the Holder of its determination of the fair market value of such
consideration prior to payment or accepting receipt thereof.  If,
within thirty (30) days after receipt of said notice, the Holder shall notify
the Board of Directors of the Company in writing of its objection to such
determination, a determination of fair market value of such consideration shall
be made by an appraiser selected by the Company and approved by the
Holder.  If the Company and the Holder are unable to agree on the
selection of an appraiser, the issue of selection of an appraiser shall be
submitted to the American Arbitration Association.

    
      
         

      

      
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    (g)           Readjustment of Exercise
Price.  Upon the expiration of the right to convert, exchange
or exercise any Common Stock Equivalents the issuance of which effected an
adjustment in the Exercise Price, if such Common Stock Equivalents shall not
have been converted, exercised or exchanged, the number of shares of Common
Stock deemed to be issued and outstanding by reason of the fact that they were
issuable upon conversion, exchange or exercise of any such Common Stock
Equivalents shall no longer be computed as set forth above, and the Exercise
Price shall forthwith be readjusted and thereafter be the price which it would
have been (but reflecting any other adjustments in the Exercise Price made
pursuant to the provisions of this Section 9 after the issuance of such Common
Stock Equivalents) had the adjustment of the Exercise Price been made in
accordance with the issuance or sale of the number of Additional Shares of
Common Stock actually issued upon conversion, exchange or issuance of such
Common Stock Equivalents and thereupon only the number of Additional Shares of
Common Stock actually so issued shall be deemed to have been issued and only the
consideration actually received by the Company shall be deemed to have been
received by the Company.

     

    (h)           Treasury
Shares.  In making any adjustment in the Exercise Price
hereinbefore provided in this Section 9, the number of shares of Common Stock at
any time outstanding shall not include any shares thereof then directly or
indirectly owned or held by or for the account of the Company.

     

    (i)           Calculations.  All
calculations under this Section 9 shall be
made to the nearest cent or the nearest 1/100th of a share, as
applicable.  The number of shares of Common Stock outstanding at any
given time shall not include shares owned or held by or for the account of the
Company, and the disposition of any such shares shall be considered an issue or
sale of Common Stock.

     

    (j)           Notice of
Adjustments.  Upon the occurrence of each adjustment pursuant
to this Section
9, the Company at its expense will promptly compute such adjustment in
accordance with the terms of this Warrant and prepare a certificate setting
forth such adjustment, including a statement of the adjusted Exercise Price and
adjusted number or type of Warrant Shares or other securities, cash or property
issuable upon exercise of this Warrant (as applicable), describing the
transactions giving rise to such adjustments and showing in detail the facts
upon which such adjustment is based.  Upon written request, the
Company will promptly deliver a copy of each such certificate to the Holder and
to the Company’s transfer agent.

    
      
         

      

      
        9

        
          

        

      

      
         

      

    

    (k)           Notice of Corporate
Events.  If the Company (i) declares a dividend or any other
distribution of cash, securities or other property in respect of its capital
stock, including without limitation any granting of rights or warrants to
subscribe for or purchase any capital stock of the Company or any Subsidiary,
(ii) authorizes or approves, enters into any agreement contemplating or solicits
stockholder approval for  (x) any sale of all or substantially all of
its assets in one or a series of related transactions, (y) any tender offer or
exchange offer (whether by the Company or another person) pursuant to which
holders of capital stock are permitted to tender or exchange their shares for
other securities, cash or property, or (z) any reclassification of the capital
stock or any compulsory share exchange pursuant to which the capital stock is
effectively converted into or exchanged for other securities, cash or property
or (iii) authorizes the voluntary dissolution, liquidation or winding up of the
affairs of the Company, then the Company shall deliver to the Holder a notice
describing the material terms and conditions of such transaction, at least ten
business days prior to the applicable record or effective date on which a Person
would need to hold capital stock in order to participate in or vote with respect
to such transaction, and the Company will take all steps reasonably necessary in
order to insure that the Holder is given the practical opportunity to exercise
this Warrant prior to such time so as to participate in or vote with respect to
such transaction; provided, however, that the failure to deliver such notice or
any defect therein shall not affect the validity of the corporate action
required to be described in such notice.

     

    10.           Payment of Exercise
Price.  The Holder shall pay the Exercise Price in immediately
available funds; provided, however, that in the
event the Registration Statement is not then effective and available for resale
by the Holder of the Warrant Shares, the Holder may satisfy its obligation to
pay the Exercise Price through a “cashless exercise,” in which event the Company
shall issue to the Holder the number of Warrant Shares determined as
follows:

     

    
      	 
      	
              X =
      Y [(A-B)/A]

            
	
              where:

            	 
      
	 
      	
              X =
      the number of Warrant Shares to be issued to the
Holder.

            
	 
      	 
      
	 
      	
              Y =
      the number of Warrant Shares with respect to which this Warrant is being
      exercised.

            
	 
      	 
      
	 
      	
              A =
      the average of the Closing Prices for the five Trading Days immediately
      prior to (but not including) the Exercise Date.

            
	 
      	 
      
	 
      	
              B =
      the Exercise Price.

            

    

    

    “Closing Price” on any
Trading Day (as defined below) shall mean the closing bid price for the Common
Stock on its primary Trading Market (as defined below), and, in the absence of
any Trading Market, shall mean the fair market value of the Common Stock, as
determined in good faith by the Company's Board of Directors.

    
      
         

      

      
        10

        
          

        

      

      
         

      

    

    “Trading Day” means
(i) a day on which the Common Stock is eligible to be traded on a Trading Market
(other than the OTC Bulletin Board), or (ii) if the Common Stock is not listed
on a Trading Market (other than the OTC Bulletin Board), a day on which the
Common Stock is eligible to be traded in the over-the-counter market, as
reported by the OTC Bulletin Board, or (iii) if the Common Stock is not quoted
on any Trading Market, a day on which the Common Stock is quoted in the
over-the-counter market as reported by the Pink Sheets LLC (or any similar
organization or agency succeeding to its functions of reporting prices);
provided, that in the event that the Common Stock is not listed or quoted as set
forth in (i), (ii) and (iii) hereof, then Trading Day shall mean a Business
Day.

     

    "Trading Market" shall
mean any regulated or self-regulated exchange or organized trading market,
including the NASDAQ Global Market, the NASDAQ Capital Market, the American
Stock Exchange, OTC Bulletin Board or Pink Sheets LLC, on which the Common Stock
is listed or quoted for trading on the date in question, as
applicable.

     

    For
purposes of Rule 144 promulgated under the Securities Act, it is intended,
understood and acknowledged that the Warrant Shares issued in a cashless
exercise transaction shall be deemed to have been acquired by the Holder, and
the holding period for the Warrant Shares shall be deemed to have commenced, on
the date this Warrant was originally issued.

     

    11.          Fractional
Shares.  The Company shall not be required to issue or cause to
be issued fractional Warrant Shares on the exercise of this
Warrant.  If any fraction of a Warrant Share would, except for the
provisions of this Section, be issuable upon exercise of this Warrant, the
number of Warrant Shares to be issued will be rounded up to the nearest whole
share.

     

    12.          Notices.  Any
and all notices or other communications or deliveries hereunder (including
without limitation any Exercise Notice) shall be in writing and shall be deemed
given and effective on the earliest of (i) the date of transmission, if such
notice or communication is delivered via facsimile at the facsimile number
specified in the Purchase Agreement prior to 6:30 p.m. (New York City time) on a
Trading Day, (ii) the next Trading Day after the date of transmission, if such
notice or communication is delivered via facsimile at the facsimile number
specified in the Purchase Agreement on a day that is not a Trading Day or later
than 6:30 p.m. (New York City time) on any Trading Day, (iii) the Trading Day
following the date of mailing, if sent by nationally recognized overnight
courier service or (iv) upon actual receipt by the party to whom such notice is
required to be given.  The address for such notices or communications
shall be as set forth in the Purchase Agreement.

     

    13.          Purchase
Agreement.  The Warrant Shares for which this Warrant is
exercisable are entitled to the benefits and subject to the limitations of the
Purchase Agreement, which include registration rights for the Warrant
Shares.

     

    14.          Miscellaneous.

     

    (a)           Subject
to the restrictions on transfer set forth herein, this Warrant and the
registration rights set forth in the Purchase Agreement may be assigned by the
Holder in not less than 25,000 Warrant Shares or in its
entirety.  This Warrant may not be assigned by the Company except to a
successor in the event of a sale of all or substantially all of the Company’s
assets or a merger or acquisition of the Company.  This Warrant shall
be binding on and inure to the benefit of the parties hereto and their
respective successors and assigns.  Subject to the preceding
sentences, nothing in this Warrant shall be construed to give to any Person
other than the Company and the Holder any legal or equitable right, remedy or
cause of action under this Warrant.  This Warrant may be amended only
in writing signed by the Company and the Holder and their successors and
assigns.

    
      
         

      

      
        11

        
          

        

      

      
         

      

    

    (b)           The
Company will not, by amendment of its governing documents 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 action as may be reasonably necessary or appropriate in order
to protect the rights of the Holder against impairment.  Without
limiting the generality of the foregoing, the Company (i) will not increase the
par value of any Warrant Shares above the amount payable therefor on such
exercise, (ii) will take all such action as may be reasonably necessary or
appropriate in order that the Company may validly and legally issue fully paid
and nonassessable Warrant Shares on the exercise of this Warrant, and (iii) will
not close its stockholder books or records in any manner which interferes with
the timely exercise of this Warrant.

     

    (C)           GOVERNING LAW; VENUE; WAIVER
OF JURY TRIAL.  ALL QUESTIONS CONCERNING THE CONSTRUCTION,
VALIDITY, ENFORCEMENT AND INTERPRETATION OF THIS WARRANT SHALL BE GOVERNED BY
AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,
WITHOUT GIVING REGARD TO ANY APPLICABLE PRINCIPLES OF CONFLICTS OF
LAW.  EACH PARTY HEREBY IRREVOCABLY SUBMITS TO THE EXCLUSIVE
JURISDICTION OF THE STATE AND FEDERAL COURTS SITTING IN THE CITY OF NEW YORK,
BOROUGH OF MANHATTAN, FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN
CONNECTION HEREWITH OR WITH ANY TRANSACTION CONTEMPLATED HEREBY OR DISCUSSED
HEREIN (INCLUDING WITH RESPECT TO THE ENFORCEMENT OF ANY OF THE TRANSACTION
DOCUMENTS), AND HEREBY IRREVOCABLY WAIVES, AND AGREES NOT TO ASSERT IN ANY SUIT,
ACTION OR PROCEEDING, ANY CLAIM THAT IT IS NOT PERSONALLY SUBJECT TO THE
JURISDICTION OF ANY SUCH COURT, THAT SUCH SUIT, ACTION OR PROCEEDING IS
IMPROPER.  EACH PARTY HEREBY IRREVOCABLY WAIVES PERSONAL SERVICE OF
PROCESS AND CONSENTS TO PROCESS BEING SERVED IN ANY SUCH SUIT, ACTION OR
PROCEEDING BY MAILING A COPY THEREOF VIA REGISTERED OR CERTIFIED MAIL OR
OVERNIGHT DELIVERY (WITH EVIDENCE OF DELIVERY) TO SUCH PARTY AT THE ADDRESS IN
EFFECT FOR NOTICES TO IT UNDER THIS AGREEMENT AND AGREES THAT SUCH SERVICE SHALL
CONSTITUTE GOOD AND SUFFICIENT SERVICE OF PROCESS AND NOTICE
THEREOF.  NOTHING CONTAINED HEREIN SHALL BE DEEMED TO LIMIT IN ANY WAY
ANY RIGHT TO SERVE PROCESS IN ANY MANNER PERMITTED BY LAW.  THE
COMPANY HEREBY WAIVES ALL RIGHTS TO A TRIAL BY JURY.

     

    (c)           The
headings herein are for convenience only, do not constitute a part of this
Warrant and shall not be deemed to limit or affect any of the provisions
hereof.

     

    
      
         

      

      
        12

        
          

        

      

      
         

      

    

     

    (d)           In
case any one or more of the provisions of this Warrant shall be invalid or
unenforceable in any respect, the validity and enforceability of the remaining
terms and provisions of this Warrant shall not in any way be affected or
impaired thereby and the parties will attempt in good faith to agree upon a
valid and enforceable provision which shall be a commercially reasonable
substitute therefor, and upon so agreeing, shall incorporate such substitute
provision in this Warrant.

     

    [REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK,

    SIGNATURE
PAGE FOLLOWS]

    
      
         

      

      
        13

        
          

        

      

      
         

      

    

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

     

    
      
        
          	
                  ARNO
      THERAPEUTICS, INC.

                
	 
      
	
                  By:

                	 
      
	
                  Name:

                	
                  David
      M. Tanen

                
	
                  Title:

                	
                  President

                

        

      

    

    
      
         

      

      
        14

        
          

        

      

      
         

      

    

    ANNEX
A

     

    FORM
OF ASSIGNMENT

     

    [To be
completed and signed only upon transfer of Warrant]

     

    FOR VALUE
RECEIVED, the undersigned hereby sells, assigns and transfers unto
________________________________ the right represented by the within Warrant to
purchase  ____________ shares of Preferred Stock or Common Stock of
Arno Therapeutics, Inc.,
to which the within Warrant relates and appoints ________________ attorney to
transfer said right on the books of Arno Therapeutics, Inc., with full power of
substitution in the premises.

     

    
      
        
          
            
              
                
                  	
                          Dated:

                        	
                           

                        	,	 
      
	 
      	 
      
	 
      	
                          (Signature
      must conform in all respects to name of holder as specified on the face of
      the Warrant)

                        
	 
      	 
      
	 
      	
                          Address
      of Transferee

                        
	 
      	 
      
	 
      	 
      
	 
      	 
      
	
                          In
      the presence of:

                        	 
      
	 
      	 
      
	 
      	 
      
	 
      	 
      

                

              

            

          

        

      

    

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    ANNEX
B

     

    FORM
OF EXERCISE NOTICE

     

    [To be
executed by the Holder to exercise the right to purchase shares of Preferred
Stock or Common Stock under the foregoing Warrant]

     

    To:  ARNO
THERAPEUTICS, INC.

     

    The
undersigned is the Holder of Warrant No. _______ (the “Warrant”) issued by Arno
Therapeutics, Inc., a Delaware corporation (the “Company”).  Capitalized
terms used herein and not otherwise defined have the respective meanings set
forth in the Warrant.

     

    
      	
               
      

            	
              1.

            	
              The
      Warrant is currently exercisable to purchase a total of ______________
      Warrant Shares.

            

    

     

    
      	
               
      

            	
              2.

            	
              The
      undersigned Holder hereby exercises its right to purchase
      _________________ Warrant Shares pursuant to the
  Warrant.

            

    

     

    
      	
               
      

            	
              3.

            	
              The
      Holder intends that payment of the Exercise Price shall be made as (check
      one):

            

    

     

    ____    “Cash
Exercise”

     

    ____    “Cashless
Exercise”

     

    
      	
               
      

            	
              4.

            	
              If
      the holder has elected a Cash Exercise, the holder shall pay the sum of
      $____________ to the Company in accordance with the terms of the
      Warrant.

            

    

     

    
      	
               
      

            	
              5.

            	
              Pursuant
      to this exercise, the Company shall deliver to the holder _______________
      Warrant Shares in accordance with the terms of the
  Warrant.

            

    

     

    
      	
               
      

            	
              6.

            	
              Following
      this exercise, the Warrant shall be exercisable to purchase a total of
      ______________ Warrant Shares.

            

    

     

    
      
        
          
            
              
                
                  
                    
                      
                        
                          	
                                  Dated:

                                	 
      	
                                  ,

                                	
                                  Name
      of Holder:

                                
	 
      	 
      
	 
      	
                                  (Print)

                                
	 
      	 
      
	 
      	
                                  By:

                                
	 
      	
                                  Name:

                                
	 
      	
                                  Title:

                                
	 
      	 
      
	 
      	
                                  (Signature
      must conform in all respects to name of holder as specified on the face of
      the
Warrant)

                                

                        

                      

                    

                  

                

              

            

          

        

      

    

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    ANNEX
C

     

    WARRANT
SHARES EXERCISE LOG

    

    
      
        
          
            
              
                	
                        DATE

                      	 	
                        NUMBER OF

                        WARRANT SHARES

                        AVAILABLE TO BE

                        EXERCISED

                      	 	 	
                        NUMBER OF

                        WARRANT SHARES

                        EXERCISED

                      	 	 	
                        NUMBER OF WARRANT

                        SHARES REMAINING TO

                        BE EXERCISEDExhibit
4.4

     

    Form
of Class B Warrant

     

    NEITHER
THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH
THESE SECURITIES ARE EXERCISABLE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR APPLICABLE STATE SECURITIES
LAWS.  THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED
OR ASSIGNED IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE
SECURITIES UNDER THE SECURITIES ACT, OR (B) IF REASONABLY REQUESTED BY THE
COMPANY, AN OPINION OF COUNSEL REASONABLY ACCEPTABLE TO THE COMPANY THAT
REGISTRATION IS NOT REQUIRED UNDER SAID THE SECURITIES ACT.

     

    ARNO
THERAPEUTICS, INC.

     

    CONVERTIBLE
PREFERRED STOCK/COMMON STOCK  PURCHASE WARRANT

    (CLASS
B)

    
      	
              Warrant
      No. B-[___]

            	
              Dated:  [________],
      2010

            

    

     

    Arno
Therapeutics, Inc., a Delaware corporation (the “Company”), hereby certifies
that, for value received, [________________________], or its registered assigns
(the “Holder”), is
entitled, subject to the terms and conditions of this Warrant (this “Warrant”):

     

    (i) prior
to the time that all shares of the Company’s Series A Convertible Preferred
Stock, par value $0.0001 per share (the “Preferred Stock”), the terms,
rights, preferences and privileges of which are set forth in that Certificate of
Designation filed with the Secretary of State of Delaware on September 3, 2010
(the “Certificate of
Designation”), shall have automatically converted into Common Stock in
accordance with the terms of such Certificate of Designation (the “Automatic Conversion”), to
purchase from the Company, up to a total of [________] shares of Preferred Stock
(each such share, a “Preferred
Warrant Share” and all such shares, the “Preferred Warrant Shares”) at
an exercise price initially equal to 115% of the then-effective Conversion Price
(as defined in the Certificate of Designation) of the Preferred Stock (the
“PW Exercise Price”);
or

     

    (ii) from
and after the Automatic Conversion, to purchase from the Company, up to a total
number of shares of common stock of the Company, $0.0001 par value per share
(the “Common Stock”),
equal to the number of shares of Common Stock that would have been issuable on
the Automatic Conversion of the Preferred Warrant Shares described above, less
the number of Preferred Warrant Shares already issued pursuant to an actual
exercise of this Warrant prior to the Automatic Conversion, had such net number
of Preferred Warrant Shares been issued and outstanding at the time of the
Automatic Conversion (each such share, a “Common Warrant Share,” and all such
shares, the “Common Warrant
Shares”), at an exercise price initially equal to 115% of the Conversion
Price of the Preferred Stock in effect on the date of the Automatic Conversion,
and thereafter as adjusted from time to time as provided in Section 9 hereof
(the “CW Exercise
Price”).

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    For the avoidance of doubt, and to
further clarify the anti-dilutive protections afforded to the Holder of this
Warrant prior to the Automatic Conversion, upon the occurrence of a dilutive
event prior to the Automatic Conversion, the Company and the Holder acknowledge
and agree that the Conversion Price, and thereby the number of shares of Common
Stock into which each Preferred Warrant Share may be converted, shall be
adjusted in accordance with the terms of the Certificate of
Designation.

     

    Except as
otherwise specified herein, (i) at any time that any of the Preferred
Stock  purchased by the Holder has not been converted to Common Stock,
references in this Warrant to “Warrant Shares” shall mean
Preferred Warrant Shares and to “Exercise Price” shall mean PW
Exercise Price; and (ii) at any time that all of the Preferred Stock has been
converted to Common Stock, references in this Warrant to “Warrant Shares” shall
mean  Common Warrant Shares and to “Exercise Price” shall mean CW
Exercise Price.

     

    This
Warrant is one of a series of similar warrants (collectively, the “Warrants”) issued pursuant to
that certain Securities Purchase and Registration Rights Agreement, dated as of
September 3, 2010, by and among the Company and the Purchaser(s) identified
therein (the “Purchase
Agreement”).

     

    1.           Definitions.  In
addition to the terms defined elsewhere in this Warrant, capitalized terms that
are not otherwise defined herein have the meanings given to such terms in the
Purchase Agreement.

     

    2.           Registration of
Warrant.  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.

     

    3.           Registration of
Transfers.

     

    (a)           Notwithstanding
anything to the contrary contained herein, this Warrant and the Warrant Shares
shall not be sold or transferred unless either (i) they first shall have been
registered under the Securities Act, or (ii) such sale or transfer shall be
exempt from the registration requirements of the Securities Act and the Company
shall have been furnished with an opinion of legal counsel, reasonably
satisfactory to the Company, to the effect that such sale or transfer is exempt
from the registration requirements of the Securities
Act.  Notwithstanding the foregoing, no registration or opinion of
counsel shall be required for (i) a transfer by a Holder which is an entity to a
wholly owned subsidiary of such entity, a transfer by a Holder which is a
partnership to a partner of such partnership or a retired partner of such
partnership or to the estate of any such partner or retired partner, or a
transfer by a Holder which is a limited liability company to a member of such
limited liability company or a retired member or to the estate of any such
member or retired member, provided that the
transferee in each case agrees in writing to be subject to the terms of this
Section 3, or
(ii) a transfer made in accordance with Rule 144 under the Securities
Act.

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    (b)           The
Company shall register the transfer of any portion of this Warrant in the
Warrant Register, upon surrender of this Warrant, with the Form of Assignment
attached hereto as Annex A duly
completed and signed, to the transfer agent or to the Company at its address
specified herein.  Upon any such registration or transfer, a new
warrant to purchase Preferred Stock and/or Common Stock, as the case may be, in
substantially the form of this Warrant (any such new warrant, a “New Warrant”), evidencing the
portion of this Warrant so transferred shall be issued to the transferee and a
New Warrant evidencing the remaining portion of this Warrant not so transferred,
if any, shall be issued to the transferring Holder.  The acceptance of
the New Warrant by the transferee thereof shall be deemed the acceptance by such
transferee of all of the rights and obligations of a holder of a
Warrant.

     

    4.           Exercise and Duration of
Warrants.

     

    (a)           Subject
to the terms and conditions of this Warrant, this Warrant shall be exercisable
by the registered Holder at any time and from time to time on or after the date
hereof, up to and including the Expiration Date (as defined
below).  Subject to paragraphs (b) and (c) of this Section 4,
on  [________], 2015, at 6:30 P.M., New York City time, the portion of
this Warrant not exercised prior thereto shall be and become void and of no
value (the “Expiration
Date”).

     

    (b)           A
Holder may exercise this Warrant by delivering to the Company (i) an exercise
notice, in the form attached hereto as Annex B (the “Exercise Notice”),
appropriately completed and duly signed along with the Warrant, and
(ii) payment of the Exercise Price for the number of Warrant Shares, as to
which this Warrant is being exercised (which may take the form of a “cashless
exercise” if so indicated in the Exercise Notice), and the date such items are
delivered to the Company (as determined in accordance with the notice provisions
hereof) is an “Exercise
Date.”  Execution and delivery of the Exercise Notice shall
have the same effect as cancellation of the original Warrant and issuance of a
New Warrant evidencing the right to purchase the remaining number of Warrant
Shares.

     

    (c)           Insufficient Authorized
Shares.  If at any time while this Warrant is outstanding, the
Company does not have a sufficient number of authorized and unreserved shares of
Preferred Stock or Common Stock to satisfy its obligation to reserve for
issuance upon exercise of this Warrant and Warrants of like tenor at least a
number of shares of Preferred Stock and Common Stock equal to 120% (the “Required Reserve Amount”) of
the number of shares of Preferred Stock and Common Stock as shall from time to
time be necessary to effect the exercise of all of the Warrants of like tenor
then outstanding (an “Authorized Share Failure”),
then the Company shall immediately take all action necessary to increase the
Company’s authorized shares of Preferred Stock and Common Stock to an amount
sufficient to allow the Company to reserve the Required Reserve Amount for the
Warrants of like tenor then outstanding.  Without limiting the
generality of the foregoing sentence, as soon as practicable after the date of
the occurrence of an Authorized Share Failure, but in no event later than sixty
(60) days after the occurrence of such Authorized Share Failure, the Company
shall hold a meeting of its stockholders for the approval of an increase in the
number of authorized shares of Preferred Stock and Common Stock.  In
connection with such meeting, the Company shall provide each stockholder with a
proxy or information statement, to the extent required by applicable law, and
shall use its reasonable best efforts to solicit its stockholders’ approval of
such increase in authorized shares of Preferred Stock and Common Stock and to
cause its board of directors to recommend to the stockholders that they approve
such proposal.

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    5.           Delivery of Warrant
Shares.

     

    (a)           The
Holder shall not be required to physically surrender this Warrant unless this
Warrant is being exercised in full.  To effect exercises hereunder,
the Holder shall duly execute and deliver to the Company at its address for
notice set forth herein, an Exercise Notice in the form of Annex B hereto, along
with the Warrant Share Exercise Log in the form of Annex C hereto, and
shall pay the Exercise Price, multiplied by the number of Warrant Shares that
the Holder intends to purchase hereunder.  The Company shall promptly
(but in no event later than three (3) Trading Days after the date of exercise)
issue or cause to be issued and cause to be delivered to or upon the written
order of the Holder a certificate for the Warrant Shares issuable upon such
exercise.  The Company shall, upon request of the Holder, and
subsequent to the date on which a registration statement covering the resale of
the Warrant Shares has been declared effective by the SEC and provided such
registration statement continues to be effective and the prospectus included
therein continues to remain current, use its best efforts to deliver
Warrant Shares hereunder electronically through the Depository Trust Corporation
or another established clearing corporation performing similar
functions.  If by the third (3rd)
Trading Day after exercise of this Warrant, the Company fails to deliver the
required number of Warrant Shares, the Holder will have the right to rescind the
exercise.  If by the third (3rd)
Trading Day after exercise, the Company fails to deliver the required number of
Warrant Shares, and if after such third Trading Day (3rd) and
prior to the receipt of such Warrant Shares, the Holder purchases (in an open
market transaction or otherwise) shares of Common Stock to deliver in
satisfaction of a sale by the Holder of Warrant Shares which the Holder
anticipated receiving upon such exercise (a “Buy In”), then the Company
shall (i) pay in cash to the Holder the amount 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 (A) the
number of Warrant Shares that the Company was required to deliver to the Holder
in connection with the exercise at issue by (B) the closing bid price of the
Common Stock on the exercise date and (ii) 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 or deliver to the Holder the number of
shares of Warrant Shares that would have been issued had the Company timely
complied with its exercise and delivery obligations hereunder.  The
Holder shall provide the Company written notice indicating the amounts payable
to the Holder in respect of the Buy In.

     

    (b)           This
Warrant is exercisable, either in its entirety or, from time to time, for a
portion of at least 25,000 Warrant Shares.  Upon surrender of this
Warrant following one or more partial exercises, the Company shall issue or
cause to be issued, at its expense, a new Warrant evidencing the right to
purchase the remaining number of Warrant Shares.

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    (c)           The
Company’s obligations to issue and deliver Warrant Shares in accordance with the
terms hereof are absolute and unconditional, irrespective of any action or
inaction by the Holder to enforce the same, any waiver or consent with respect
to any provision hereof, the recovery of any judgment against any Person or any
action to enforce the same, or any setoff, counterclaim, recoupment, limitation
or termination, or any breach or alleged breach by the Holder or any other
Person of any obligation to the Company or any violation or alleged violation of
law by the Holder or any other Person, and irrespective of any other
circumstance which might otherwise limit such obligation of the Company to the
Holder in connection with the issuance of Warrant Shares.  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 certificates representing shares of Common Stock upon
exercise of the Warrant as required pursuant to the terms hereof.

     

    6.           Charges, Taxes and
Expenses.  Initial issuance and delivery of certificates for
shares of Preferred Stock or Common Stock, as the case may be, upon exercise of
this Warrant shall be made without charge to the Holder for any issue or
transfer tax, withholding tax, transfer agent fee or other incidental tax or
expense in respect of the issuance of such certificates, all of which taxes and
expenses shall be paid by the Company; provided, however, that the
Company shall not be required to pay any tax which may be payable in respect of
any transfer involved in the registration of any certificates for Warrant Shares
or Warrants in a name other than that of the Holder.

     

    7.           Replacement of
Warrant.  If this Warrant is mutilated, lost, stolen or
destroyed, the Company shall issue or cause to be issued in exchange and
substitution for and upon cancellation hereof, or in lieu of and substitution
for this Warrant, a new Warrant, but only upon receipt of evidence reasonably
satisfactory to the Company of such loss, theft or destruction and customary and
reasonable bond or indemnity, if requested.  Applicants for a new
Warrant under such circumstances shall also comply with such other reasonable
regulations and procedures and pay such other reasonable third-party costs as
the Company may prescribe.

     

    8.           Reservation of Warrant
Shares.  The Company covenants that it will at all times
reserve and keep available out of the aggregate of its authorized but unissued
and otherwise unreserved Preferred Stock and Common Stock, solely for the
purpose of enabling it to issue Warrant Shares upon exercise of this Warrant as
herein provided, the number of Warrant Shares that are then issuable and
deliverable upon the exercise of this entire Warrant, free from preemptive
rights or any other contingent purchase rights of persons other than the Holder
(after giving effect to the adjustments and restrictions of Section 9, if
any).  The Company covenants that all Warrant Shares so issuable and
deliverable shall, upon issuance and the payment of the applicable Exercise
Price in accordance with the terms hereof, be duly and validly authorized,
issued and fully paid and nonassessable.  The Company will take all
such action as may be necessary to assure that such shares of Preferred Stock or
Common Stock, as the case may be, may be issued as provided herein without
violation of any applicable law or regulation, or of any requirements of any
securities exchange or automated quotation system upon which the Preferred Stock
or the Common Stock may be listed.  The Company will notify its
transfer agent for the Preferred Stock and for the Common Stock of the
reservation of shares of Preferred Stock and Common Stock as required under this
provision.

     

    9.           Certain
Adjustments.  The CW Exercise Price and number of Common
Warrant Shares issuable upon exercise of this Warrant are subject to adjustment
from time to time as set forth in this Section 9 following
any Automatic Conversion. The Company and the Holder acknowledge and agree that
comparable adjustments in the PW Exercise Price and number of Preferred Warrant
Shares for the events and matters described below are to be addressed by the
terms of the Certificate of Designation relating to the Series A Preferred Stock
prior to any Automatic Conversion.

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    (a)           Stock Dividends and
Splits.  If after the date hereof, the number of outstanding
shares of Common Stock is increased by a stock dividend payable in shares of
Common Stock or by a split-up of shares of Common Stock or other similar event,
then, on the effective date thereof, the number of Warrant Shares issuable on
exercise of this Warrant shall be increased in proportion to such increase in
outstanding shares and the then applicable Exercise Price shall be
correspondingly decreased.

     

    (b)           Aggregation of
Shares.  If after the date hereof, the number of outstanding
shares of Common Stock is decreased by a consolidation, combination or
reclassification of shares of Common Stock or other similar event, then, upon
the effective date of such consolidation, combination or reclassification, the
number of Warrant Shares issuable on exercise of this Warrant shall be decreased
in proportion to such decrease in outstanding shares and the then applicable
Exercise Price shall be correspondingly increased.

     

    (c)           Replacement of Securities
Upon Reorganization, etc.  If after the date hereof any capital
reorganization or reclassification of the Common Stock of the Company, or
consolidation or merger of the Company with another corporation, or the sale of
all or substantially all of its assets to another corporation or other similar
event (each, a “Fundamental
Transaction”) shall be effected, then, as a condition of such Fundamental
Transaction, lawful and fair provision shall be made whereby the Holder of this
Warrant shall thereafter have the right to purchase and receive, upon the basis
and upon the terms and conditions specified in this Warrant and in lieu of the
shares of Common Stock of the Company immediately theretofore purchasable and
receivable upon the exercise of the rights represented thereby, such shares of
stock, securities, or assets as may be issued or payable with respect to or in
exchange for the number of outstanding shares of such Common Stock equal to the
number of shares of such stock immediately theretofore purchasable and
receivable upon the exercise of the rights represented by this Warrant, had such
Fundamental Transaction not taken place and in such event appropriate provision
shall be made with respect to the rights and interests of the Holder of this
Warrant to the end that the provisions hereof (including, without limitation,
provisions for adjustments of the Exercise Price and of the number of shares
purchasable upon the exercise of this Warrant) shall thereafter be applicable,
as nearly as may be in relation to any share of stock, securities, or assets
thereafter deliverable upon the exercise hereof.  The Company shall
not effect any such Fundamental Transaction unless prior to the consummation
thereof the successor corporation (if other than the Company) resulting from
such Fundamental Transaction, or the corporation purchasing such assets in a
Fundamental Transaction, shall assume by written instrument executed and
delivered to the Holder of this Warrant the obligation to deliver to the Holder
of this Warrant such shares of stock, securities, or assets as, in accordance
with the foregoing provisions, such holders may be entitled to
purchase.

     

    (d)           Adjustment of Exercise Price
Upon Issuance of Additional Shares of Common Stock.  In the
event the Company shall at any time after the Automatic Conversion issue shares
of Common Stock (the “Additional Shares of Common
Stock”), other than Exempt Issuances (as defined below), while any
portion of this Warrant remains outstanding, without consideration or for a
consideration per share less than the Exercise Price, then the Exercise Price
shall be reduced, concurrently with such issue, to a price (calculated to the
nearest one-hundredth of a cent), determined in accordance with the following
formula:

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    EP2 = EP1 * (A + B)
÷ (A + C).

     

    For
purposes of the foregoing formula, the following definitions shall
apply:

     

    (a)           “EP2” shall
mean the Exercise Price in effect immediately after such issue of Additional
Shares of Common Stock;

     

    (b)           “EP1” shall
mean the Exercise Price in effect immediately prior to such issue of Additional
Shares of Common Stock;

     

    (c)           “A”
shall mean the number of shares of Common Stock outstanding immediately prior to
such issue of Additional Shares of Common Stock (treating for this purpose as
outstanding all shares of Common Stock issuable upon exercise, conversion or
exchange of Common Stock Equivalents (as defined below) outstanding immediately
prior to such issue;

     

    (d)           “B”
shall mean the number of shares of Common Stock that would have been issued if
such Additional Shares of Common Stock had been issued at a price per share
equal to EP1
(determined by dividing the aggregate consideration received by the Company in
respect of such issue by EP1);
and

     

    (e)           “C”
shall mean the number of such Additional Shares of Common Stock issued in such
transaction.

     

    For
purposes hereof, “Exempt
Issuances” shall mean the issuance of (i) an aggregate number of Common
Stock or Common Stock Equivalents (as defined below, and whether in the form of
shares of Common Stock or options), not to exceed in the aggregate after any
issuance, ten percent (10%) of all then issued and outstanding Common Stock
Equivalents held by all persons, to employees, officers and/or independent
directors pursuant to the Corporation’s 2005 Stock Option Plan or such other
equity incentive plan approved by the Corporation’s stockholders, provided, in either
case, such issuances are approved by the Corporation’s Board of Directors,
including approval of at least 50% of the Corporation’s independent directors
and all three Investor Directors; (ii) shares of Common Stock or Common Stock
Equivalents issued as part of the purchase consideration in mergers or
acquisitions of businesses or assets, provided, such
issuances are approved by the Corporation’s Board of Directors, including
approval of all three Investor Directors; (iii) shares of Common Stock issuable
upon the exercise or conversion of Common Stock Equivalents outstanding as of
the Original Issuance Date; (iii) shares of Common Stock issuable upon the
exercise or conversion of Common Stock Equivalents outstanding as of the date
this Warrant was originally issued; (iv) Common Stock issued to the Company’s
stockholders upon any stock split, stock dividend or similar event with respect
to the Common Stock; (v)  up to 500,000 shares of Common Stock or
Common Stock Equivalents issued to banks, equipment lessors or other financial
institutions, or to real property lessors, pursuant to a debt financing,
equipment leasing or real property leasing transaction approved by the Board of
Directors of the Company, provided, such
issuances are approved by the Corporation’s Board of Directors, including
approval of all three Investor Directors; (vi) shares of Common Stock or Common
Stock Equivalents issued as a dividend or distribution on the Preferred Stock;
or (vii)  shares of Common Stock actually issued upon the exercise,
conversion or exchange of Common Stock Equivalents, in each case provided such
issuance is pursuant to the terms of such Common Stock Equivalents and that an
adjustment to the Exercise Price was either made or not required to be made in
accordance with Section 9(d) hereof.

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

    (e)           Adjustment of Exercise Price
Upon Issuance of Common Stock Equivalents.  In the event the
Company shall at any time after the Closing Date issue any Convertible Security
(defined as evidences of indebtedness, shares of stock or other securities which
are or may be at any time convertible into or exchangeable for shares of Common
Stock) or warrant, option or other right to subscribe for or purchase any shares
of Common Stock or any Convertible Security (“Common Stock Equivalents”),
while any portion of this Warrant remains outstanding, other than Exempt
Issuances, and the price per share for which Additional Shares of Common Stock
may be issuable thereafter pursuant to such Common Stock Equivalents shall be
less than the Exercise Price, or if, after any such issuance of Common Stock
Equivalents, the price per share for which Additional Shares of Common Stock may
be issuable thereafter is amended, and such price as so amended shall be less
than the Exercise Price, then the Exercise Price upon each such issuance or
amendment shall be adjusted as provided in Section 9(d) above, on the basis that
Additional Shares of Common Stock issuable pursuant to such Common Stock
Equivalents shall be deemed to have been issued (whether or not such Common
Stock Equivalents are actually then exercisable, convertible or exchangeable in
whole or in part) as of the earlier of (i) the date on which the Company shall
enter into a firm contract for the issuance of such Common Stock Equivalents, or
(ii) the date of actual issuance of such Common Stock Equivalents.  No
adjustment of the Exercise Price shall be made under this Section 9(e) upon the
issuance of any Convertible Security which is issued pursuant to the exercise of
any warrants or other subscription or purchase rights therefore, if any
adjustment shall previously have been made in the Exercise Price then in effect
upon the issuance of such warrants or other rights pursuant to this Section
9(e).

     

    (f)      
     Computation of
Consideration.  The consideration received by the Company shall
be deemed to be the following: to the extent that any Additional Shares of
Common Stock or any Common Stock Equivalents shall be issued for a cash
consideration, the consideration received by the Company therefore; or, if such
Additional Shares of Common Stock or Common Stock Equivalents are offered by the
Company for subscription, the subscription price; or, if such Additional Shares
of Common Stock or Common Stock Equivalents are sold to underwriters or dealers
for public offering without a subscription offering, the initial public offering
price, in any such case excluding any amounts paid or receivable for accrued
interest or accrued dividends and without deduction of any compensation,
discounts, commissions, or expenses paid or incurred by the Company for or in
connection with the underwriting thereof or otherwise in connection with the
issue thereof.  The consideration for any Additional Shares of Common
Stock issuable pursuant to any Common Stock Equivalents shall be the
consideration received by the Company for issuing such Common Stock Equivalents,
plus the additional consideration payable to the Company upon the exercise,
conversion or exchange of such Common Stock Equivalents.  In case of
the issuance at any time of any Additional Shares of Common Stock or Common
Stock Equivalents in payment or satisfaction of any dividend upon any class of
stock other than Common Stock, the Company shall be deemed to have received for
such Additional Shares of Common Stock or Common Stock Equivalents a
consideration equal to the amount of such dividend so paid or
satisfied.  In any case in which the consideration to be received or
paid shall be other than cash, the Board of Directors of the Company shall
determine in good faith the fair market value of such consideration and promptly
notify the Holder of its determination of the fair market value of such
consideration prior to payment or accepting receipt thereof.  If,
within thirty (30) days after receipt of said notice, the Holder shall notify
the Board of Directors of the Company in writing of its objection to such
determination, a determination of fair market value of such consideration shall
be made by an appraiser selected by the Company and approved by the
Holder.  If the Company and the Holder are unable to agree on the
selection of an appraiser, the issue of selection of an appraiser shall be
submitted to the American Arbitration Association.

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

    (g)           Readjustment of Exercise
Price.  Upon the expiration of the right to convert, exchange
or exercise any Common Stock Equivalents the issuance of which effected an
adjustment in the Exercise Price, if such Common Stock Equivalents shall not
have been converted, exercised or exchanged, the number of shares of Common
Stock deemed to be issued and outstanding by reason of the fact that they were
issuable upon conversion, exchange or exercise of any such Common Stock
Equivalents shall no longer be computed as set forth above, and the Exercise
Price shall forthwith be readjusted and thereafter be the price which it would
have been (but reflecting any other adjustments in the Exercise Price made
pursuant to the provisions of this Section 9 after the issuance of such Common
Stock Equivalents) had the adjustment of the Exercise Price been made in
accordance with the issuance or sale of the number of Additional Shares of
Common Stock actually issued upon conversion, exchange or issuance of such
Common Stock Equivalents and thereupon only the number of Additional Shares of
Common Stock actually so issued shall be deemed to have been issued and only the
consideration actually received by the Company shall be deemed to have been
received by the Company.

     

    (h)           Treasury
Shares.  In making any adjustment in the Exercise Price
hereinbefore provided in this Section 9, the number of shares of Common Stock at
any time outstanding shall not include any shares thereof then directly or
indirectly owned or held by or for the account of the Company.

     

    (i)        
   Calculations.  All
calculations under this Section 9 shall be
made to the nearest cent or the nearest 1/100th of a share, as
applicable.  The number of shares of Common Stock outstanding at any
given time shall not include shares owned or held by or for the account of the
Company, and the disposition of any such shares shall be considered an issue or
sale of Common Stock.

     

    (j)          
 Notice of
Adjustments.  Upon the occurrence of each adjustment pursuant
to this Section
9, the Company at its expense will promptly compute such adjustment in
accordance with the terms of this Warrant and prepare a certificate setting
forth such adjustment, including a statement of the adjusted Exercise Price and
adjusted number or type of Warrant Shares or other securities, cash or property
issuable upon exercise of this Warrant (as applicable), describing the
transactions giving rise to such adjustments and showing in detail the facts
upon which such adjustment is based.  Upon written request, the
Company will promptly deliver a copy of each such certificate to the Holder and
to the Company’s transfer agent.

    
      
         

      

      
        9

        
          

        

      

      
         

      

    

    (k)           Notice of Corporate
Events.  If the Company (i) declares a dividend or any other
distribution of cash, securities or other property in respect of its capital
stock, including without limitation any granting of rights or warrants to
subscribe for or purchase any capital stock of the Company or any Subsidiary,
(ii) authorizes or approves, enters into any agreement contemplating or solicits
stockholder approval for  (x) any sale of all or substantially all of
its assets in one or a series of related transactions, (y) any tender offer or
exchange offer (whether by the Company or another person) pursuant to which
holders of capital stock are permitted to tender or exchange their shares for
other securities, cash or property, or (z) any reclassification of the capital
stock or any compulsory share exchange pursuant to which the capital stock is
effectively converted into or exchanged for other securities, cash or property
or (iii) authorizes the voluntary dissolution, liquidation or winding up of the
affairs of the Company, then the Company shall deliver to the Holder a notice
describing the material terms and conditions of such transaction, at least ten
business days prior to the applicable record or effective date on which a Person
would need to hold capital stock in order to participate in or vote with respect
to such transaction, and the Company will take all steps reasonably necessary in
order to insure that the Holder is given the practical opportunity to exercise
this Warrant prior to such time so as to participate in or vote with respect to
such transaction; provided, however, that the failure to deliver such notice or
any defect therein shall not affect the validity of the corporate action
required to be described in such notice.

     

    10.         Payment of Exercise
Price.  The Holder shall pay the Exercise Price in immediately
available funds; provided, however, that in the
event the Registration Statement is not then effective and available for resale
by the Holder of the Warrant Shares, the Holder may satisfy its obligation to
pay the Exercise Price through a “cashless exercise,” in which event the Company
shall issue to the Holder the number of Warrant Shares determined as
follows:

     

    
      	 
      	
              X =
      Y [(A-B)/A]

            
	
              where:

            	 
      
	 
      	
              X =
      the number of Warrant Shares to be issued to the
Holder.

            
	 
      	 
      
	 
      	
              Y =
      the number of Warrant Shares with respect to which this Warrant is being
      exercised.

            
	 
      	 
      
	 
      	
              A =
      the average of the Closing Prices for the five Trading Days immediately
      prior to (but not including) the Exercise Date.

            
	 
      	 
      
	 
      	
              B =
      the Exercise Price.

            

    

    

    “Closing Price” on any
Trading Day (as defined below) shall mean the closing bid price for the Common
Stock on its primary Trading Market (as defined below), and, in the absence of
any Trading Market, shall mean the fair market value of the Common Stock, as
determined in good faith by the Company's Board of Directors.

    
      
         

      

      
        10

        
          

        

      

      
         

      

    

    “Trading Day” means
(i) a day on which the Common Stock is eligible to be traded on a Trading Market
(other than the OTC Bulletin Board), or (ii) if the Common Stock is not listed
on a Trading Market (other than the OTC Bulletin Board), a day on which the
Common Stock is eligible to be traded in the over-the-counter market, as
reported by the OTC Bulletin Board, or (iii) if the Common Stock is not quoted
on any Trading Market, a day on which the Common Stock is quoted in the
over-the-counter market as reported by the Pink Sheets LLC (or any similar
organization or agency succeeding to its functions of reporting prices);
provided, that in the event that the Common Stock is not listed or quoted as set
forth in (i), (ii) and (iii) hereof, then Trading Day shall mean a Business
Day.

     

    "Trading Market" shall
mean any regulated or self-regulated exchange or organized trading market,
including the NASDAQ Global Market, the NASDAQ Capital Market, the American
Stock Exchange, OTC Bulletin Board or Pink Sheets LLC, on which the Common Stock
is listed or quoted for trading on the date in question, as
applicable.

     

    For
purposes of Rule 144 promulgated under the Securities Act, it is intended,
understood and acknowledged that the Warrant Shares issued in a cashless
exercise transaction shall be deemed to have been acquired by the Holder, and
the holding period for the Warrant Shares shall be deemed to have commenced, on
the date this Warrant was originally issued.

     

    11.         Fractional
Shares.  The Company shall not be required to issue or cause to
be issued fractional Warrant Shares on the exercise of this
Warrant.  If any fraction of a Warrant Share would, except for the
provisions of this Section, be issuable upon exercise of this Warrant, the
number of Warrant Shares to be issued will be rounded up to the nearest whole
share.

     

    12.         Notices.  Any
and all notices or other communications or deliveries hereunder (including
without limitation any Exercise Notice) shall be in writing and shall be deemed
given and effective on the earliest of (i) the date of transmission, if such
notice or communication is delivered via facsimile at the facsimile number
specified in the Purchase Agreement prior to 6:30 p.m. (New York City time) on a
Trading Day, (ii) the next Trading Day after the date of transmission, if such
notice or communication is delivered via facsimile at the facsimile number
specified in the Purchase Agreement on a day that is not a Trading Day or later
than 6:30 p.m. (New York City time) on any Trading Day, (iii) the Trading Day
following the date of mailing, if sent by nationally recognized overnight
courier service or (iv) upon actual receipt by the party to whom such notice is
required to be given.  The address for such notices or communications
shall be as set forth in the Purchase Agreement.

     

    13.         Purchase
Agreement.  The Warrant Shares for which this Warrant is
exercisable are entitled to the benefits and subject to the limitations of the
Purchase Agreement, which include registration rights for the Warrant
Shares.

     

    14.         Miscellaneous.

     

    (a)           Subject
to the restrictions on transfer set forth herein, this Warrant and the
registration rights set forth in the Purchase Agreement may be assigned by the
Holder in not less than 25,000 Warrant Shares or in its
entirety.  This Warrant may not be assigned by the Company except to a
successor in the event of a sale of all or substantially all of the Company’s
assets or a merger or acquisition of the Company.  This Warrant shall
be binding on and inure to the benefit of the parties hereto and their
respective successors and assigns.  Subject to the preceding
sentences, nothing in this Warrant shall be construed to give to any Person
other than the Company and the Holder any legal or equitable right, remedy or
cause of action under this Warrant.  This Warrant may be amended only
in writing signed by the Company and the Holder and their successors and
assigns.

    
      
         

      

      
        11

        
          

        

      

      
         

      

    

    (b)           The
Company will not, by amendment of its governing documents 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 action as may be reasonably necessary or appropriate in order
to protect the rights of the Holder against impairment.  Without
limiting the generality of the foregoing, the Company (i) will not increase the
par value of any Warrant Shares above the amount payable therefor on such
exercise, (ii) will take all such action as may be reasonably necessary or
appropriate in order that the Company may validly and legally issue fully paid
and nonassessable Warrant Shares on the exercise of this Warrant, and (iii) will
not close its stockholder books or records in any manner which interferes with
the timely exercise of this Warrant.

     

    (C)           GOVERNING LAW; VENUE; WAIVER
OF JURY TRIAL.  ALL QUESTIONS CONCERNING THE CONSTRUCTION,
VALIDITY, ENFORCEMENT AND INTERPRETATION OF THIS WARRANT SHALL BE GOVERNED BY
AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,
WITHOUT GIVING REGARD TO ANY APPLICABLE PRINCIPLES OF CONFLICTS OF
LAW.  EACH PARTY HEREBY IRREVOCABLY SUBMITS TO THE EXCLUSIVE
JURISDICTION OF THE STATE AND FEDERAL COURTS SITTING IN THE CITY OF NEW YORK,
BOROUGH OF MANHATTAN, FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN
CONNECTION HEREWITH OR WITH ANY TRANSACTION CONTEMPLATED HEREBY OR DISCUSSED
HEREIN (INCLUDING WITH RESPECT TO THE ENFORCEMENT OF ANY OF THE TRANSACTION
DOCUMENTS), AND HEREBY IRREVOCABLY WAIVES, AND AGREES NOT TO ASSERT IN ANY SUIT,
ACTION OR PROCEEDING, ANY CLAIM THAT IT IS NOT PERSONALLY SUBJECT TO THE
JURISDICTION OF ANY SUCH COURT, THAT SUCH SUIT, ACTION OR PROCEEDING IS
IMPROPER.  EACH PARTY HEREBY IRREVOCABLY WAIVES PERSONAL SERVICE OF
PROCESS AND CONSENTS TO PROCESS BEING SERVED IN ANY SUCH SUIT, ACTION OR
PROCEEDING BY MAILING A COPY THEREOF VIA REGISTERED OR CERTIFIED MAIL OR
OVERNIGHT DELIVERY (WITH EVIDENCE OF DELIVERY) TO SUCH PARTY AT THE ADDRESS IN
EFFECT FOR NOTICES TO IT UNDER THIS AGREEMENT AND AGREES THAT SUCH SERVICE SHALL
CONSTITUTE GOOD AND SUFFICIENT SERVICE OF PROCESS AND NOTICE
THEREOF.  NOTHING CONTAINED HEREIN SHALL BE DEEMED TO LIMIT IN ANY WAY
ANY RIGHT TO SERVE PROCESS IN ANY MANNER PERMITTED BY LAW.  THE
COMPANY HEREBY WAIVES ALL RIGHTS TO A TRIAL BY JURY.

     

    (c)           The
headings herein are for convenience only, do not constitute a part of this
Warrant and shall not be deemed to limit or affect any of the provisions
hereof.

    
      
         

      

      
        12

        
          

        

      

      
         

      

    

    (d)           In
case any one or more of the provisions of this Warrant shall be invalid or
unenforceable in any respect, the validity and enforceability of the remaining
terms and provisions of this Warrant shall not in any way be affected or
impaired thereby and the parties will attempt in good faith to agree upon a
valid and enforceable provision which shall be a commercially reasonable
substitute therefor, and upon so agreeing, shall incorporate such substitute
provision in this Warrant.

     

    [REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK,

    SIGNATURE
PAGE FOLLOWS]

    
      
         

      

      
        13

        
          

        

      

      
         

      

    

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

     

    
      
        
          	 
      	
                  ARNO
      THERAPEUTICS, INC.

                
	 
      	 
      
	 
      	
                  By:____________________________

                
	 
      	
                  Name:

                	
                  David
      M. Tanen

                
	 
      	
                  Title:

                	
                  President

                

        

      

    

    
      
         

      

      
        14

        
          

        

      

      
         

      

    

    ANNEX
A

     

    FORM
OF ASSIGNMENT

     

    [To be
completed and signed only upon transfer of Warrant]

     

    FOR VALUE
RECEIVED, the undersigned hereby sells, assigns and transfers unto
________________________________ the right represented by the within Warrant to
purchase  ____________ shares of Preferred Stock or Common Stock of
Arno Therapeutics, Inc.,
to which the within Warrant relates and appoints ________________ attorney to
transfer said right on the books of Arno Therapeutics, Inc., with full power of
substitution in the premises.

     

    
      
        	
                Dated: __________,

              	 
      
	 
      	 
      
	 
      	
                (Signature
      must conform in all respects to name of holder as specified on the face of
      the Warrant)

              
	 
      	 
      
	 
      	
                Address
      of Transferee

              
	 
      	 
      
	
                In
      the presence of:

              	 
      

      

    

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    ANNEX
B

     

    FORM
OF EXERCISE NOTICE

     

    [To be
executed by the Holder to exercise the right to purchase shares of Preferred
Stock or Common Stock under the foregoing Warrant]

     

    To:  ARNO
THERAPEUTICS, INC.

     

    The
undersigned is the Holder of Warrant No. _______ (the “Warrant”) issued by Arno
Therapeutics, Inc., a Delaware corporation (the “Company”).  Capitalized
terms used herein and not otherwise defined have the respective meanings set
forth in the Warrant.

     

    
      	
               
      

            	
              1.

            	
              The
      Warrant is currently exercisable to purchase a total of ______________
      Warrant Shares.

            

    

     

    
      	
               
      

            	
              2.

            	
              The
      undersigned Holder hereby exercises its right to purchase
      _________________ Warrant Shares pursuant to the
  Warrant.

            

    

     

    
      	
               
      

            	
              3.

            	
              The
      Holder intends that payment of the Exercise Price shall be made as (check
      one):

            

    

     

    ____    “Cash
Exercise”

     

    ____    “Cashless
Exercise”

     

    
      	
               
      

            	
              4.

            	
              If
      the holder has elected a Cash Exercise, the holder shall pay the sum of
      $____________ to the Company in accordance with the terms of the
      Warrant.

            

    

     

    
      	
               
      

            	
              5.

            	
              Pursuant
      to this exercise, the Company shall deliver to the holder _______________
      Warrant Shares in accordance with the terms of the
  Warrant.

            

    

     

    
      	
               
      

            	
              6.

            	
              Following
      this exercise, the Warrant shall be exercisable to purchase a total of
      ______________ Warrant Shares.

            

    

     

    
      
        	
                Dated: __________,

              	
                Name
      of Holder:

              
	 
      	 
      
	 
      	
                (Print)

              
	 
      	 
      
	 
      	
                By:

              
	 
      	
                Name:

              
	 
      	
                Title:

              
	 
      	 
      
	 
      	
                (Signature
      must conform in all respects to name of holder as specified on the face of
      the Warrant)

              

      

    

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    ANNEX
C

     

    WARRANT
SHARES EXERCISE LOG

    

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                	
                                        DATE

                                      	 	
                                        NUMBER OF

                                        WARRANT SHARES

                                        AVAILABLE TO BE

                                        EXERCISED

                                      	 	
                                        NUMBER OF

                                        WARRANT SHARES

                                        EXERCISED

                                      	 	
                                        NUMBER OF WARRANT

                                        SHARES REMAINING TO

                                        BE EXERCISED

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00180-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00180-of-00352.parquet"}]]