Document:

Exhibit 4.1

 

WARRANT AGENT AGREEMENT

 

WARRANT AGENT AGREEMENT (this “Warrant
Agreement”) dated as of August 9, 2018 (the “Issuance Date”) between Electrameccanica Vehicles Corp.,
a British Columbia corporation (the “Company”), and VStock Transfer, LLC (the “Warrant Agent”).

 

WHEREAS, pursuant to the terms of that
certain Underwriting Agreement (“Underwriting Agreement”), dated August 8, 2018, by and among the Company and
The Benchmark Company, LLC, as representative of the underwriters set forth therein, the Company is engaged in a public offering
(the “Offering”) of up to 2,353,000 units, (the “Units”), each unit consisting of one
common share, no par value per share (each a “Common Share”), of the Company and two warrants each to purchase
one Common Share at an exercise price of $4.25 per share (each, a “Warrant” and collectively, the “Warrants”,
and the Common Shares issued upon the exercise of such Warrants the “Warrant Shares”), plus 352,950 Common Shares
and 705,900 Warrants issuable pursuant to the underwriters’ over-allotment option;

 

WHEREAS, the Company has filed with the
Securities and Exchange Commission (the “Commission”) a Registration Statement, No. 333-222814, on Form F-1
(as the same may be amended from time to time, the “Registration Statement”), for the registration under the
Securities Act of 1933, as amended (the “Securities Act”), of the Units, Common Shares, Warrants and Warrant
Shares, and such Registration Statement was declared effective on August 3, 2018;

 

WHEREAS, the Company desires the Warrant
Agent to act on behalf of the Company, and the Warrant Agent is willing to so act, in accordance with the terms set forth in this
Warrant Agreement in connection with the issuance, registration, transfer, exchange and exercise of the Warrants;

 

WHEREAS, the Company desires to provide
for the provisions of the Warrants, the terms upon which they shall be issued and exercised, and the respective rights, limitation
of rights, and immunities of the Company, the Warrant Agent, and the holders of the Warrants; and

 

WHEREAS, all acts and things have been
done and performed which are necessary to make the Warrants the valid, binding and legal obligations of the Company and to authorize
the execution and delivery of this Warrant Agreement.

 

NOW, THEREFORE, in consideration of the
mutual agreements herein contained, the parties hereto agree as follows:

 

1. Appointment of Warrant Agent.
The Company hereby appoints the Warrant Agent to act as agent for the Company with respect to the Warrants, and the Warrant Agent
hereby accepts such appointment and agrees to perform the same in accordance with the express terms and conditions set forth in
this Warrant Agreement (and no implied terms or conditions).

 

2. Warrants.

 

2.1 Form of Warrants. The Warrants
shall be registered securities and shall be initially evidenced by a global Warrant certificate (“Global Certificate”)
in the form of Annex A to this Warrant Agreement, which shall be deposited on behalf of the Company with a custodian for
The Depository Trust Company (“DTC”) and registered in the name of Cede & Co., a nominee of DTC. If DTC
subsequently ceases to make its settlement system available for the Warrants, the Company may instruct the Warrant Agent regarding
making arrangements for book-entry settlement. In the event that the Warrants are not eligible for, or it is no longer necessary
to have the Warrants available in, registration in the name of Cede & Co., a nominee of DTC, the Company may instruct the Warrant
Agent to provide written instructions to DTC to deliver to the Warrant Agent for cancellation the Global Certificate, and the Company
shall instruct the Warrant Agent to deliver to each Holder (as defined below) separate certificates evidencing Warrants (“Definitive
Certificates” and, together with the Global Certificate, “Warrant Certificates”), in the form of Annex
C to this Warrant Agreement. The Warrants represented by the Global Certificate are referred to as “Global Warrants”.

 

     

     

    

 

2.2. Issuance and Registration of Warrants.

 

2.2.1. Warrant Register. The Warrant
Agent shall maintain books (“Warrant Register”) for the registration of original issuance and the registration
of transfer of the Warrants. Any Person in whose name ownership of a beneficial interest in the Warrants evidenced by a Global
Certificate is recorded in the records maintained by DTC or its nominee shall be deemed the “beneficial owner” thereof,
provided that all such beneficial interests shall be held through a Participant (as defined below), which shall be the registered
holder of such Warrants.

 

2.2.2. Issuance of Warrants. Upon
the initial issuance of the Warrants, the Warrant Agent shall issue the Global Certificate and deliver the Warrants in the DTC
settlement system in accordance with written instructions delivered to the Warrant Agent by the Company. Ownership of beneficial
interests in the Warrants shall be shown on, and the transfer of such ownership shall be effected through, records maintained (i)
by DTC and (ii) by institutions that have accounts with DTC (each, a “Participant”), subject to a Holder’s
right to elect to receive a Warrant in certificated form in the form of Annex C to this Warrant Agreement. Any Holder desiring
to elect to receive a Warrant in certificated form shall make such request in writing delivered to the Warrant Agent pursuant to
Section 2.2.8, and shall surrender to the Warrant Agent the interest of the Holder on the books of the Participant evidencing the
Warrants which are to be represented by a Definitive Certificate through the DTC settlement system. Thereupon, the Warrant Agent
shall countersign and deliver to the person entitled thereto a Warrant Certificate or Warrant Certificates, as the case may be,
as so requested.

 

2.2.3. Beneficial Owner; Holder.
Prior to due presentment for registration of transfer of any Warrant, the Company and the Warrant Agent may deem and treat the
person in whose name that Warrant shall be registered on the Warrant Register (the “Holder”) as the absolute
owner of such Warrant for purposes of any exercise thereof, and for all other purposes, and neither the Company nor the Warrant
Agent shall be affected by any notice to the contrary. Notwithstanding the foregoing, nothing herein shall prevent the Company,
the Warrant Agent or any agent of the Company or the Warrant Agent from giving effect to any written certification, proxy or other
authorization furnished by DTC governing the exercise of the rights of a holder of a beneficial interest in any Warrant. The rights
of beneficial owners in a Warrant evidenced by the Global Certificate shall be exercised by the Holder or a Participant through
the DTC system, except to the extent set forth herein or in the Global Certificate.

 

2.2.4. Execution. The Warrant Certificates
shall be executed on behalf of the Company by any authorized officer of the Company (an “Authorized Officer”),
which need not be the same authorized signatory for all of the Warrant Certificates, either manually or by facsimile signature.
The Warrant Certificates shall be countersigned by an authorized signatory of the Warrant Agent, which need not be the same signatory
for all of the Warrant Certificates, and no Warrant Certificate shall be valid for any purpose unless so countersigned. In case
any Authorized Officer of the Company that signed any of the Warrant Certificates ceases to be an Authorized Officer of the Company
before countersignature by the Warrant Agent and issuance and delivery by the Company, such Warrant Certificates, nevertheless,
may be countersigned by the Warrant Agent, issued and delivered with the same force and effect as though the person who signed
such Warrant Certificates had not ceased to be such officer of the Company; and any Warrant Certificate may be signed on behalf
of the Company by any person who, at the actual date of the execution of such Warrant Certificate, shall be an Authorized Officer
of the Company authorized to sign such Warrant Certificate, although at the date of the execution of this Warrant Agreement any
such person was not such an Authorized Officer.

 

2.2.5. Registration of Transfer.
At any time at or prior to the Expiration Date (as defined below), a transfer of any Warrants may be registered and any Warrant
Certificate or Warrant Certificates may be split up, combined or exchanged for another Warrant Certificate or Warrant Certificates
evidencing the same number of Warrants as the Warrant Certificate or Warrant Certificates surrendered. Any Holder desiring to register
the transfer of Warrants or to split up, combine or exchange any Warrant Certificate shall make such request in writing delivered
to the Warrant Agent, and shall surrender to the Warrant Agent the Warrant Certificate or Warrant Certificates evidencing the Warrants
the transfer of which is to be registered or that is or are to be split up, combined or exchanged. Thereupon, the Warrant Agent
shall countersign and deliver to the person entitled thereto a Warrant Certificate or Warrant Certificates, as the case may be,
as so requested. The Warrant Agent may require reasonable and customary payment, by the Holder requesting a registration of transfer
of Warrants or a split-up, combination or exchange of a Warrant Certificate (but, for purposes of clarity, not upon the exercise
of the Warrants and issuance of Warrant Shares to the Holder), of a sum sufficient to cover any tax or governmental charge that
may be imposed in connection with such registration of transfer, split-up, combination or exchange, together with reimbursement
to the Warrant Agent of all reasonable expenses incidental thereto.

 

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2.2.6. Loss, Theft and Mutilation of
Warrant Certificates. Upon receipt by the Company and the Warrant Agent of evidence reasonably satisfactory to them of the
loss, theft, destruction or mutilation of a Warrant Certificate, and, in case of loss, theft or destruction, of indemnity or security
in customary form and amount (which shall in no event include the posting of any bond), and reimbursement to the Company and the
Warrant Agent of all reasonable expenses incidental thereto, and upon surrender to the Warrant Agent and cancellation of the Warrant
Certificate if mutilated, the Warrant Agent shall, on behalf of the Company, countersign and deliver a new Warrant Certificate
of like tenor to the Holder in lieu of the Warrant Certificate so lost, stolen, destroyed or mutilated. The Warrant Agent may charge
the Holder an administrative fee for processing the replacement of lost Warrant Certificates, which shall be charged only once
in instances where a single surety bond obtained covers multiple certificates. The Warrant Agent may receive compensation from
the surety companies or surety bond agents for administrative services provided to them.

 

2.2.7. Proxies. The Holder of a
Warrant may grant proxies or otherwise authorize any person, including the Participants and beneficial holders that may own interests
through the Participants, to take any action that a Holder is entitled to take under this Agreement or the Warrants; provided,
however, that at all times that Warrants are evidenced by a Global Certificate, exercise of those Warrants shall be effected
on their behalf by Participants through DTC in accordance the procedures administered by DTC.

 

2.2.8. Warrant Certificate Request.
A Holder has the right to elect at any time or from time to time a Warrant Exchange (as defined below) pursuant to a Warrant Certificate
Request Notice (as defined below). Upon written notice by a Holder to the Warrant Agent for the exchange of some or all of such
Holder’s Global Warrants for a Definitive Certificate evidencing the same number of Warrants, which request shall be in the
form attached hereto as Annex E (a “Warrant Certificate Request Notice” and the date of delivery of such
Warrant Certificate Request Notice by the Holder, the “Warrant Certificate Request Notice Date” and the deemed
surrender upon delivery by the Holder of a number of Global Warrants for the same number of Warrants evidenced by a Definitive
Certificate, a “Warrant Exchange”), the Warrant Agent shall promptly effect the Warrant Exchange and shall promptly
issue and deliver to the Holder a Definitive Certificate for such number of Warrants in the name set forth in the Warrant Certificate
Request Notice. Such Definitive Certificate shall be dated the original issue date of the Warrants, shall be manually executed
by an authorized signatory of the Company, shall be in the form attached hereto as Annex C, and shall be reasonably acceptable
in all respects to such Holder. In connection with a Warrant Exchange, the Company agrees to deliver, or to direct the Warrant
Agent to deliver, the Definitive Certificate to the Holder within the earlier of (i) two (2) Trading Days and (ii) the number of
Trading Days comprising the Standard Settlement Period of the Warrant Certificate Request Notice pursuant to the delivery instructions
in the Warrant Certificate Request Notice (“Warrant Certificate Delivery Date”). If the Company fails for any
reason to deliver to the Holder the Definitive Certificate subject to the Warrant Certificate Request Notice by the Warrant Certificate
Delivery Date, the Company shall pay to the Holder, in cash, as liquidated damages and not as a penalty, for each $1,000 of Warrant
Shares evidenced by such Definitive Certificate (based on the VWAP (as defined in the Warrants) of the Common Share on the Warrant
Certificate Request Notice Date), $10 per Business Day for each Business Day after such Warrant Certificate Delivery Date until
such Definitive Certificate is delivered or, prior to delivery of such Warrant Certificate, the Holder rescinds such Warrant Exchange.
The Company covenants and agrees that, upon the date of delivery of the Warrant Certificate Request Notice, the Holder shall be
deemed to be the holder of the Definitive Certificate and, notwithstanding anything to the contrary set forth herein, the Definitive
Certificate shall be deemed for all purposes to contain all of the terms and conditions of the Warrants evidenced by such Warrant
Certificate and the terms of this Agreement, other than Sections 3(c) and 9 herein, shall not apply to the Warrants evidenced by
the Definitive Certificate.

 

2.2.9. For purposes of clarity, if there
is a conflict between the express terms of this Warrant Agreement and the Warrant certificate in the form of Annex C hereto with
respect to terms of the Warrants, the terms of the Warrant certificate shall govern and control.

 

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3. Terms and Exercise of Warrants.

 

3.1. Exercise Price. Each Warrant
shall entitle the Holder, subject to the provisions of the applicable Warrant Certificate and of this Warrant Agreement, to purchase
from the Company the number of Common Shares stated therein, at the price of $4.25 per share, subject to the subsequent adjustments
provided in Section 4 hereof. The term “Exercise Price” as used in this Warrant Agreement refers to the price
per share at which Common Shares may be purchased at the time a Warrant is exercised.

 

3.2. Duration of Warrants. Warrants
may be exercised only during the period (“Exercise Period”) commencing on the Issuance Date and terminating
at 5:00 P.M., New York City time (the “close of business”) on August 13, 2023 (“Expiration Date”).
Each Warrant not exercised on or before the Expiration Date shall become void, and all rights thereunder and all rights in respect
thereof under this Warrant Agreement shall cease at the close of business on the Expiration Date.

 

3.3. Exercise of Warrants.

 

3.3.1. Exercise and Payment.

 

(a) Exercise of the
purchase rights represented by a Warrant may be made, in whole or in part, at any time or times on or after the Initial Exercise
Date and on or before close of business on the Expiration Date by delivery to the Company of the Notice of Exercise in the form
annexed as Annex B hereto (the “Notice of Exercise”). Within earlier of (i) two (2) Trading Days and
(ii) the number of Trading Days comprising the Standard Settlement Period following the date of exercise as aforesaid, the Holder
shall deliver the aggregate Exercise Price for the shares specified in the applicable Notice of Exercise by wire transfer or cashier’s
check drawn on a United States bank unless the cashless exercise procedure specified in Section 3.3.7 below is specified in the
applicable Notice of Exercise. No ink-original Notice of Exercise shall be required, nor shall any medallion guarantee (or other
type of guarantee or notarization) of any Notice of Exercise form be required. Notwithstanding anything herein to the contrary,
the Holder shall not be required to physically surrender a Warrant Certificate to the Company until the Holder has purchased all
of the Warrant Shares available thereunder and the Warrant has been exercised in full, in which case, the Holder shall surrender
such Warrant to the Company for cancellation within three (3) Trading Days of the date the final Notice of Exercise is delivered
to the Company. Partial exercises of a Warrant resulting in purchases of a portion of the total number of Warrant Shares available
thereunder shall have the effect of lowering the outstanding number of Warrant Shares purchasable hereunder in an amount equal
to the applicable number of Warrant Shares purchased. The Holder and the Company shall maintain records showing the number of Warrant
Shares purchased and the date of such purchases. The Company shall deliver any objection to any Notice of Exercise within one (1)
Business Day of receipt of such notice. The Holder and any assignee, by acceptance of a Warrant, acknowledge and agree that,
by reason of the provisions of this paragraph, following the purchase of a portion of the Warrant Shares hereunder, the number
of Warrant Shares available for purchase hereunder at any given time may be less than the amount stated on the face thereof.

 

Notwithstanding the
foregoing in this Section 3.3.1, a holder whose interest in a Warrant is a beneficial interest in certificate(s) representing such
Warrant held in registered form through DTC (or another established clearing corporation performing similar functions), shall effect
exercises made pursuant to this Section 3.3.1 by delivering to DTC (or such other clearing corporation, as applicable) the appropriate
instruction form for exercise, complying with the procedures to effect exercise that are required by DTC (or such other clearing
corporation, as applicable), subject to a Holder’s right to elect to receive a Warrant in certificated form pursuant to the
terms of the Warrant Agent Agreement, in which case this sentence shall not apply.

 

3.3.2. Issuance of Warrant Shares.
(a) The Warrant Agent shall, on the Trading Day following the date of exercise of any Warrant, advise the Company, the transfer
agent and registrar for the Company’s Common Shares, in respect of (i) the number of Warrant Shares indicated on the Notice
of Exercise as issuable upon such exercise with respect to such exercised Warrants, (ii) the instructions of the Holder or Participant,
as the case may be, provided to the Warrant Agent with respect to the delivery of the Warrant Shares and the number of Warrants
that remain outstanding after such exercise and (iii) such other information as the Company or such transfer agent and registrar
shall reasonably request.

 

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(b) The Company shall cause the Warrant
Shares purchased hereunder to be transmitted by the Transfer Agent to the Holder by crediting the account of the Holder’s
or its designee’s balance account with The Depository Trust Company through its Deposit or Withdrawal at Custodian system
(“DWAC”) if the Company is then a participant in such system and either (A) there is an effective registration
statement permitting the issuance of the Warrant Shares to or resale of the Warrant Shares by Holder or (B) this Warrant is being
exercised via cashless exercise, and otherwise by physical delivery of a certificate, registered in the Company’s share register
in the name of the Holder or its designee, for the number of Warrant Shares to which the Holder is entitled pursuant to such exercise
to the address specified by the Holder in the Notice of Exercise by the date that is the earlier of (i) two (2) Trading Days and
(ii) the number of Trading Days comprising the Standard Settlement Period after the delivery to the Company of the Notice of Exercise
(such date, the “Warrant Share Delivery Date”). Upon delivery of the Notice of Exercise, the Holder shall be
deemed for all corporate purposes to have become the holder of record of the Warrant Shares with respect to which this Warrant
has been exercised, irrespective of the date of delivery of the Warrant Shares, provided that payment of the aggregate Exercise
Price (other than in the case of a cashless exercise) is received within earlier of (i) two (2) Trading Days and (ii) the number
of Trading Days comprising the Standard Settlement Period following delivery of the Notice of Exercise. If the Company fails for
any reason to deliver to the Holder the Warrant Shares subject to a Notice of Exercise by the Warrant Share Delivery Date, the
Company shall pay to the Holder, in cash, as liquidated damages and not as a penalty, for each $1,000 of Warrant Shares subject
to such exercise (based on the VWAP of the Common Shares on the date of the applicable Notice of Exercise), $10 per Trading Day
(increasing to $20 per Trading Day on the fifth Trading Day after such liquidated damages begin to accrue) for each Trading Day
after such Warrant Share Delivery Date until such Warrant Shares are delivered or Holder rescinds such exercise. The Company agrees
to maintain a transfer agent that is a participant in the FAST program so long as this Warrant remains outstanding and exercisable.
As used herein, “Standard Settlement Period” means the standard settlement period, expressed in a number of
Trading Days, on the Company’s primary Trading Market with respect to the Common Shares as in effect on the date of delivery
of the Notice of Exercise.

 

3.3.3. Valid Issuance. All Warrant
Shares issued by the Company upon the proper exercise of a Warrant in conformity with this Warrant Agreement shall be validly issued,
fully paid and non-assessable.

 

3.3.4. No Fractional Exercise. No
fractional Warrant Shares will be issued upon the exercise of the Warrant. If, by reason of any adjustment made pursuant to Section
4, a Holder would be entitled, upon the exercise of such Warrant, to receive a fractional interest in a share, the Company shall,
upon such exercise, round up or down, as applicable, to the nearest whole number the number of Warrant Shares to be issued to such
Holder.

 

3.3.5 No Transfer Taxes. Issuance
of Warrant Shares shall be made without charge to the Holder for any issue or transfer tax or other incidental expense in respect
of the issuance of such Warrant Shares, all of which taxes and expenses shall be paid by the Company, and such Warrant Shares shall
be issued in the name of the Holder or in such name or names as may be directed by the Holder; provided, however,
that in the event Warrant Shares are to be issued in a name other than the name of the Holder, this Warrant when surrendered for
exercise shall be accompanied by the Assignment Form attached hereto duly executed by the Holder and the Company may require, as
a condition thereto, the payment of a sum sufficient to reimburse it for any transfer tax incidental thereto. The Company shall
pay all Transfer Agent fees required for same-day processing of any Notice of Exercise and all fees to the Depository Trust Company
(or another established clearing corporation performing similar functions) required for same-day electronic delivery of the Warrant
Shares.

 

3.3.6 [RESERVED]

 

3.3.7 Restrictive Legend Events; Cashless
Exercise Under Certain Circumstances.

 

(i) The Company shall use it reasonable
best efforts to maintain the effectiveness of the Registration Statement and the current status of the prospectus included therein
or to file and maintain the effectiveness of another registration statement and another current prospectus covering the Warrants
and the Warrant Shares at any time that the Warrants are exercisable. The Company shall provide to the Warrant Agent and each Holder
prompt written notice of any time that the Company is unable to deliver the Warrant Shares via DTC transfer or otherwise without
restrictive legend because (A) the Commission has issued a stop order with respect to the Registration Statement, (B) the Commission
otherwise has suspended or withdrawn the effectiveness of the Registration Statement, either temporarily or permanently, (C) the
Company has suspended or withdrawn the effectiveness of the Registration Statement, either temporarily or permanently, (D) the
prospectus contained in the Registration Statement is not available for the issuance of the Warrant Shares to the Holder or (E)
otherwise (each a “Restrictive Legend Event”). To the extent that the Warrants cannot be exercised as a result
of a Restrictive Legend Event or a Restrictive Legend Event occurs after a Holder has exercised Warrants in accordance with the
terms of the Warrants but prior to the delivery of the Warrant Shares, the Company shall, at the election of the Holder, which
shall be given within five (5) days of receipt of such notice of the Restrictive Legend Event, either (A) rescind the previously
submitted Election to Purchase and the Company shall return all consideration paid by registered holder for such shares upon such
rescission or (B) treat the attempted exercise as a cashless exercise as described in paragraph (ii) below and refund the cash
portion of the exercise price to the Holder.

 

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(ii) If a Restrictive Legend Event has
occurred, the Warrant may also be exercisable on a cashless basis. Notwithstanding anything herein to the contrary, the Company
shall not be required to make any cash payments or net cash settlement to the Holder in lieu of delivery of the Warrant Shares.
Upon a “cashless exercise”, the Holder shall be entitled to receive the number of Warrant Shares equal to the quotient
obtained by dividing (A-B) (X) by (A), where:

 

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

 

(B) = the
Exercise Price of the Warrant, as adjusted as set forth herein; and

 

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

 

If the Warrant Shares are issued in such
a cashless exercise, the Company acknowledges and agrees that, in accordance with Section 3(a)(9) of the Securities Act, the Warrant
Shares shall take on the registered characteristics of the Warrants being exercised and the Company agrees not to take any position
contrary thereto. Upon receipt of an Election to Purchase for a cashless exercise, the Warrant Agent will promptly deliver a copy
of the Election to Purchase to the Company to confirm the number of Warrant Shares issuable in connection with the cashless exercise.
The Company shall calculate and transmit to the Warrant Agent in a written notice, and the Warrant Agent shall have no duty, responsibility
or obligation under this section to calculate, the number of Warrant Shares issuable in connection with any cashless exercise.
The Warrant Agent shall be entitled to rely conclusively on any such written notice provided by the Company, and the Warrant Agent
shall not be liable for any action taken, suffered or omitted to be taken by it in accordance with such written instructions or
pursuant to this Warrant Agreement. Notwithstanding anything herein to the contrary, on the Termination Date, this Warrant shall
be automatically exercised via cashless exercise pursuant to this Section 3.3.7.

 

3.3.8 Disputes. In the case of a
dispute as to the determination of the Exercise Price or the arithmetic calculation of the number of Warrant Shares issuable in
connection with any exercise, the Company shall promptly deliver to the Holder the number of Warrant Shares that are not disputed.

 

3.3.9 Compensation for Buy-In on Failure
to Timely Deliver Warrant Shares Upon Exercise. In addition to any other rights available to the Holder, if the Company fails
to cause the Transfer Agent to transmit to the Holder the Warrant Shares in accordance with the provisions of Section 3.3.2(b)
above pursuant to an exercise on or before the Warrant Share Delivery Date, and if after such date the Holder is required by its
broker to purchase (in an open market transaction or otherwise) or the Holder’s brokerage firm otherwise purchases, Common
Shares to deliver in satisfaction of a sale by the Holder of the Warrant Shares which the Holder anticipated receiving upon such
exercise (a “Buy-In”), then the Company shall (A) pay in cash to the Holder the amount, if any, by which (x) the Holder’s
total purchase price (including brokerage commissions, if any) for the Common Shares so purchased exceeds (y) the amount obtained
by multiplying (1) the number of Warrant Shares that the Company was required to deliver to the Holder in connection with the exercise
at issue times (2) the price at which the sell order giving rise to such purchase obligation was executed, and (B) at the option
of the Holder, either reinstate the portion of the Warrant and equivalent number of Warrant Shares for which such exercise was
not honored (in which case such exercise shall be deemed rescinded) or deliver to the Holder the number of Common Shares that would
have been issued had the Company timely complied with its exercise and delivery obligations hereunder. For example, if the Holder
purchases Common Shares having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted exercise of Common
Shares with an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (A) of the immediately preceding
sentence the Company shall be required to pay the Holder $1,000. The Holder shall provide the Company written notice indicating
the amounts payable to the Holder in respect of the Buy-In and, upon request of the Company, evidence of the amount of such loss.
Nothing herein shall limit a Holder’s right to pursue any other remedies available to it hereunder, at law or in equity including,
without limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s failure to timely
deliver Common Shares upon exercise of the Warrant as required pursuant to the terms hereof.

 

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3.3.10 Beneficial Ownership Limitation.
The Company shall not effect any exercise of this Warrant, and a Holder shall not have the right to exercise any portion of a Warrant,
pursuant to Section 3 or otherwise, to the extent that after giving effect to such issuance after exercise as set forth on the
applicable Notice of Exercise, the Holder (together with the Holder’s Affiliates, and any other Persons acting as a group
together with the Holder or any of the Holder’s Affiliates (such Persons, “Attribution Parties”)), would beneficially
own in excess of the Beneficial Ownership Limitation (as defined below). For purposes of the foregoing sentence, the number of
Common Shares beneficially owned by the Holder and its Affiliates and Attribution Parties shall include the number of Common Shares
issuable upon exercise of such Warrant with respect to which such determination is being made, but shall exclude the number of
Common Shares which would be issuable upon (i) exercise of the remaining, non-exercised portion of such Warrant beneficially owned
by the Holder or any of its Affiliates or Attribution Parties and (ii) exercise or conversion of the unexercised or non-converted
portion of any other securities of the Company (including, without limitation, any other securities of the Company which would
entitle the holder thereof to acquire at any time Common Shares, including, without limitation, any debt, preferred stock, right,
option, warrant or other instrument that is at any time convertible into or exercisable or exchangeable for, or otherwise entitles
the holder thereof to receive, Common Shares “Common Share Equivalents”) subject to a limitation on conversion or exercise
analogous to the limitation contained herein beneficially owned by the Holder or any of its Affiliates or Attribution Parties.
Except as set forth in the preceding sentence, for purposes of this Section 3.3.10, beneficial ownership shall be calculated in
accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder, it being acknowledged by
the Holder that the Company is not representing to the Holder that such calculation is in compliance with Section 13(d) of the
Exchange Act and the Holder is solely responsible for any schedules required to be filed in accordance therewith. To the extent
that the limitation contained in this Section 3.3.10 applies, the determination of whether a Warrant is exercisable (in relation
to other securities owned by the Holder together with any Affiliates and Attribution Parties) and of which portion of a Warrant
is exercisable shall be in the sole discretion of the Holder, and the submission of a Notice of Exercise shall be deemed to be
the Holder’s determination of whether a Warrant is exercisable (in relation to other securities owned by the Holder together
with any Affiliates and Attribution Parties) and of which portion of a Warrant is exercisable, in each case subject to the Beneficial
Ownership Limitation, and the Company shall have no obligation to verify or confirm the accuracy of such determination. In addition,
a determination as to any group status as contemplated above shall be determined in accordance with Section 13(d) of the Exchange
Act and the rules and regulations promulgated thereunder. For purposes of this Section 3.3.10, in determining the number of outstanding
Common Shares, a Holder may rely on the number of outstanding Common Shares as reflected in (A) the Company’s most recent
periodic or annual report filed with the Commission, as the case may be, (B) a more recent public announcement by the Company or
(C) a more recent written notice by the Company or the Transfer Agent setting forth the number of Common Shares outstanding. Upon
the written or oral request of a Holder, the Company shall within two Trading Days confirm orally and in writing to the Holder
the number of Common Shares then outstanding. In any case, the number of outstanding Common Shares shall be determined after giving
effect to the conversion or exercise of securities of the Company, including such Warrant, by the Holder or its Affiliates or Attribution
Parties since the date as of which such number of outstanding Common Shares was reported. The “Beneficial Ownership Limitation”
shall be 4.99% (or, upon election by a Holder prior to the issuance of any Warrants, 9.99%) of the number of Common Shares outstanding
immediately after giving effect to the issuance of Common Shares issuable upon exercise of a Warrant. The Holder, upon notice to
the Company, may increase or decrease the Beneficial Ownership Limitation provisions of this Section 3.3.10, provided that the
Beneficial Ownership Limitation in no event exceeds 9.99% of the number of Common Shares outstanding immediately after giving effect
to the issuance of Common Shares upon exercise of this Warrant held by the Holder and the provisions of this Section 3.3.10 shall
continue to apply. Any increase in the Beneficial Ownership Limitation will not be effective until the 61st day after such notice
is delivered to the Company. The provisions of this paragraph shall be construed and implemented in a manner otherwise than in
strict conformity with the terms of this Section 3.3.10 to correct this paragraph (or any portion hereof) which may be defective
or inconsistent with the intended Beneficial Ownership Limitation herein contained or to make changes or supplements necessary
or desirable to properly give effect to such limitation. The limitations contained in this paragraph shall apply to a successor
holder of this Warrant.

 

    	 	7	 

     

    

 

4. Adjustments.

 

4.1 Adjustment upon Subdivisions or
Combinations. If the Company, at any time while the Warrants are outstanding: (i) pays a stock dividend or otherwise makes
a distribution or distributions on its Common Share or any other equity or equity equivalent securities payable in Common Shares
(which, for avoidance of doubt, shall not include any Common Shares issued by the Company upon exercise of the Warrants), (ii)
subdivides outstanding Common Shares into a larger number of shares, (iii) combines (including by way of reverse stock split) outstanding
Common Shares into a smaller number of shares, or (iv) issues by reclassification of the Common Shares any shares of capital stock
of the Company, then in each case the Exercise Price shall be multiplied by a fraction of which the numerator shall be the number
of Common Shares (excluding treasury shares, if any) outstanding immediately before such event and of which the denominator shall
be the number of Common Shares outstanding immediately after such event, and the number of shares issuable upon exercise of each
Warrant shall be proportionately adjusted such that the aggregate Exercise Price of such Warrant shall remain unchanged. Any adjustment
made pursuant to this Section 4.1 shall become effective immediately after the record date for the determination of stockholders
entitled to receive such dividend or distribution and shall become effective immediately after the effective date in the case of
a subdivision, combination or re-classification.

 

4.2 Adjustment for Other Distributions.
(a) Subsequent Rights Offerings. In addition to any adjustments pursuant to Section 4.1 above, if at any time the Company
grants, issues or sells any Common Share Equivalents or rights to purchase stock, warrants, securities or other property pro rata
to the record holders of any class of Common Shares (the “Purchase Rights”), then the Holder will be entitled
to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired
if the Holder had held the number of Common Shares acquirable upon complete exercise of a Warrant (without regard to any limitations
on exercise hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the date on which a record
is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record
holders of Common Shares are to be determined for the grant, issue or sale of such Purchase Rights (provided, however, to the extent
that the Holder’s right to participate in any such Purchase Right would result in the Holder exceeding the Beneficial Ownership
Limitation, then the Holder shall not be entitled to participate in such Purchase Right to such extent (or beneficial ownership
of such Common Shares as a result of such Purchase Right to such extent) and such Purchase Right to such extent shall be held in
abeyance for the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial
Ownership Limitation).

 

(b) Pro Rata Distributions. During
such time as the Warrants are outstanding, if the Company shall declare or make any dividend or other distribution of its assets
(or rights to acquire its assets) to holders of Common Shares, by way of return of capital or otherwise (including, without limitation,
any distribution of cash, stock or other securities, property or options by way of a dividend, spin off, reclassification, corporate
rearrangement, scheme of arrangement or other similar transaction) (a "Distribution"), at any time after the issuance
of the Warrants, then, in each such case, the Holder shall be entitled to participate in such Distribution to the same extent that
the Holder would have participated therein if the Holder had held the number of Common Shares acquirable upon complete exercise
of such Warrant (without regard to any limitations on exercise hereof, including without limitation, the Beneficial Ownership Limitation)
immediately before the date of which a record is taken for such Distribution, or, if no such record is taken, the date as of which
the record holders of Common Shares are to be determined for the participation in such Distribution (provided, however,
to the extent that the Holder's right to participate in any such Distribution would result in the Holder exceeding the Beneficial
Ownership Limitation, then the Holder shall not be entitled to participate in such Distribution to such extent (or in the beneficial
ownership of any Common Shares as a result of such Distribution to such extent) and the portion of such Distribution shall be held
in abeyance for the benefit of the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding
the Beneficial Ownership Limitation).

 

    	 	8	 

     

    

 

4.3. Reclassification, Consolidation,
Purchase, Combination, Sale or Conveyance. If, at any time while the Warrants are outstanding, (i) the Company, directly or
indirectly, in one or more related transactions effects any merger or consolidation of the Company with or into another Person,
(ii) the Company, directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition
of all or substantially all of its assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer,
tender offer or exchange offer (whether by the Company or another Person) is completed pursuant to which holders of Common Share
are permitted to sell, tender or exchange their shares for other securities, cash or property and has been accepted by the holders
of 50% or more of the outstanding Common Share, (iv) the Company, directly or indirectly, in one or more related transactions effects
any reclassification, reorganization or recapitalization of the Common Share or any compulsory share exchange pursuant to which
the Common Share is effectively converted into or exchanged for other securities, cash or property, or (v) the Company, directly
or indirectly, in one or more related transactions consummates a stock or share purchase agreement or other business combination
(including, without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with another Person or group
of Persons whereby such other Person or group acquires more than 50% of the outstanding Common Shares (not including any Common
Shares held by the other Person or other Persons making or party to, or associated or affiliated with the other Persons making
or party to, such stock or share purchase agreement or other business combination) (each a “Fundamental Transaction”),
then, upon any subsequent exercise of a Warrant, the Holder shall have the right to receive, for each Warrant Share that would
have been issuable upon such exercise immediately prior to the occurrence of such Fundamental Transaction, at the option of the
Holder (without regard to any limitation in Section 3.3.10 on the exercise of a Warrant), the number of Common Shares of the successor
or acquiring corporation or of the Company, if it is the surviving corporation, and any additional consideration (the “Alternate
Consideration”) receivable as a result of such Fundamental Transaction by a holder of the number of Common Shares for
which this Warrant is exercisable immediately prior to such Fundamental Transaction (without regard to any limitation in Section
3.3.10 on the exercise of a Warrant). For purposes of any such exercise, the determination of the Exercise Price shall be appropriately
adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in respect of one share
of Common Share in such Fundamental Transaction, and the Company shall apportion the Exercise Price among the Alternate Consideration
in a reasonable manner reflecting the relative value of any different components of the Alternate Consideration. If holders of
Common Shares are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then the
Holder shall be given the same choice as to the Alternate Consideration it receives upon any exercise of this Warrant following
such Fundamental Transaction. The Company shall cause any successor entity in a Fundamental Transaction in which the Company is
not the survivor (the “Successor Entity”) to assume in writing all of the obligations of the Company under the
Warrants in accordance with the provisions of this Section 4.3 pursuant to written agreements prior to such Fundamental Transaction
and shall, at the option of the Holder, deliver to the Holder in exchange for this Warrant a security of the Successor Entity evidenced
by a written instrument substantially similar in form and substance to this Warrant which is exercisable for a corresponding number
of shares of capital stock of such Successor Entity (or its parent entity) equivalent to the Common Shares acquirable and receivable
upon exercise of this Warrant (without regard to any limitations on the exercise of this Warrant) prior to such Fundamental Transaction,
and with an exercise price which applies the exercise price hereunder to such shares of capital stock (but taking into account
the relative value of the Common Shares pursuant to such Fundamental Transaction and the value of such shares of capital stock,
such number of shares of capital stock and such exercise price being for the purpose of protecting the economic value of this Warrant
immediately prior to the consummation of such Fundamental Transaction). Upon the occurrence of any such Fundamental Transaction,
the Successor Entity shall succeed to, and be substituted for (so that from and after the date of such Fundamental Transaction,
the provisions of the Warrants referring to the “Company” shall refer instead to the Successor Entity), and may exercise
every right and power of the Company and shall assume all of the obligations of the Company under the Warrants with the same effect
as if such Successor Entity had been named as the Company therein.

 

The Company shall instruct the Warrant
Agent in writing to mail by first class mail, postage prepaid, to each Holder, written notice of the execution of any such amendment,
supplement or agreement with the Successor Entity. Any supplemented or amended agreement entered into by the successor corporation
or transferee shall provide for adjustments, which shall be as nearly equivalent as may be practicable to the adjustments provided
for in this Section 4.3. The Warrant Agent shall have no duty, responsibility or obligation to determine the correctness of any
provisions contained in such agreement or such notice, including but not limited to any provisions relating either to the kind
or amount of securities or other property receivable upon exercise of warrants or with respect to the method employed and provided
therein for any adjustments, and shall be entitled to rely conclusively for all purposes upon the provisions contained in any such
agreement. The provisions of this Section 4.3 shall similarly apply to successive reclassifications, changes, consolidations, mergers,
sales and conveyances of the kind described above.

 

    	 	9	 

     

    

 

4.4. Notices to Holder. (a) Adjustment
to Exercise Price. Whenever the Exercise Price is adjusted pursuant to any provision of this Section 4, the Company shall promptly
deliver to the Holder by facsimile or email a notice setting forth the Exercise Price after such adjustment and any resulting adjustment
to the number of Warrant Shares and setting forth a brief statement of the facts requiring such adjustment.

 

(b) Notice to Allow Exercise by Holder.
If (A) the Company shall declare a dividend (or any other distribution in whatever form) on the Common Share, (B) the Company shall
declare a special nonrecurring cash dividend on or a redemption of the Common Share, (C) the Company shall authorize the granting
to all holders of the Common Shares rights or warrants to subscribe for or purchase any shares of capital stock of any class or
of any rights, (D) the approval of any stockholders of the Company shall be required in connection with any reclassification of
the Common Share, any consolidation or merger to which the Company is a party, any sale or transfer of all or substantially all
of the assets of the Company, or any compulsory share exchange whereby the Common Share is converted into other securities, cash
or property, or (E) the Company shall authorize the voluntary or involuntary dissolution, liquidation or winding up of the affairs
of the Company, then, in each case, the Company shall cause to be delivered by facsimile or email to the Holder at its last facsimile
number or email address as it shall appear upon the Warrant Register of the Company, at least 20 calendar days prior to the applicable
record or effective date hereinafter specified, a notice stating (x) the date on which a record is to be taken for the purpose
of such dividend, distribution, redemption, rights or warrants, or if a record is not to be taken, the date as of which the holders
of the Common Share of record to be entitled to such dividend, distributions, redemption, rights or warrants are to be determined
or (y) the date on which such reclassification, consolidation, merger, sale, transfer or share exchange is expected to become effective
or close, and the date as of which it is expected that holders of the Common Share of record shall be entitled to exchange their
Common Shares for securities, cash or other property deliverable upon such reclassification, consolidation, merger, sale, transfer
or share exchange; provided that the failure to deliver such notice or any defect therein or in the delivery thereof shall not
affect the validity of the corporate action required to be specified in such notice. To the extent that any notice provided in
this Warrant constitutes, or contains, material, non-public information regarding the Company or any of the Subsidiaries, the Company
shall simultaneously file such notice with the Commission pursuant to a Current Report on Form 8-K. The Holder shall remain entitled
to exercise this Warrant during the period commencing on the date of such notice to the effective date of the event triggering
such notice except as may otherwise be expressly set forth herein.

 

4.5 Other Events. If any event occurs
of the type contemplated by the provisions of Section 4.1 or 4.2 but not expressly provided for by such provisions (including,
without limitation, the granting of stock appreciation rights, Adjustment Rights, phantom stock rights or other rights with equity
features to all holders of Common Share for no consideration), then the Company's Board of Directors will, at its discretion and
in good faith, make an adjustment in the Exercise Price and the number of Warrant Shares or designate such additional consideration
to be deemed issuable upon exercise of a Warrant, so as to protect the rights of the registered Holder. No adjustment to the Exercise
Price will be made pursuant to more than one sub-section of this Section 4 in connection with a single issuance.

 

4.6. Notices of Changes in Warrant.
Upon every adjustment of the Exercise Price or the number of Warrant Shares issuable upon exercise of a Warrant, the Company shall
give written notice thereof to the Warrant Agent, which notice shall state the Exercise Price resulting from such adjustment and
the increase or decrease, if any, in the number of Warrant Shares purchasable at such price upon the exercise of a Warrant, setting
forth in reasonable detail the method of calculation and the facts upon which such calculation is based. Upon the occurrence of
any event specified in Sections 4.1 or 4.2, then, in any such event, the Company shall give written notice to each Holder, at the
last address set forth for such holder in the Warrant Register, as of the record date or the effective date of the event. Failure
to give such notice, or any defect therein, shall not affect the legality or validity of such event. The Warrant Agent shall be
entitled to rely conclusively on, and shall be fully protected in relying on, any certificate, notice or instructions provided
by the Company with respect to any adjustment of the Exercise Price or the number of shares issuable upon exercise of a Warrant,
or any related matter, and the Warrant Agent shall not be liable for any action taken, suffered or omitted to be taken by it in
accordance with any such certificate, notice or instructions or pursuant to this Warrant Agreement. The Warrant Agent shall not
be deemed to have knowledge of any such adjustment unless and until it shall have received written notice thereof from the Company.

 

    	 	10	 

     

    

 

5. Restrictive Legends; Fractional Warrants.

 

In the event that a Warrant Certificate
surrendered for transfer bears a restrictive legend, the Warrant Agent shall not register that transfer until the Warrant Agent
has received an opinion of counsel for the Company stating that such transfer may be made and indicating whether the Warrants must
also bear a restrictive legend upon that transfer. The Warrant Agent shall not be required to effect any registration of transfer
or exchange which will result in the transfer of or delivery of a Warrant Certificate for a fraction of a Warrant.

 

6. [RESERVED].

 

7. Other Provisions Relating to Rights of Holders of Warrants.

 

7.1. No Rights as Stockholder. Except
as otherwise specifically provided herein, a Holder, solely in its capacity as a holder of Warrants, shall not be entitled to vote
or receive dividends or be deemed the holder of share capital of the Company for any purpose, nor shall anything contained in this
Warrant Agreement be construed to confer upon a Holder, solely in its capacity as the registered holder of Warrants, any of the
rights of a stockholder of the Company or any right to vote, give or withhold consent to any corporate action (whether any reorganization,
issue of stock, reclassification of share capital, consolidation, merger, conveyance or otherwise), receive notice of meetings,
receive dividends or subscription rights or rights to participate in new issues of shares, or otherwise, prior to the issuance
to the Holder of the Warrant Shares which it is then entitled to receive upon the due exercise of Warrants.

 

7.2. Reservation of Common Share.
The Company shall at all times reserve and keep available a number of its authorized but unissued Common Shares that will be sufficient
to permit the exercise in full of all outstanding Warrants issued pursuant to this Warrant Agreement.

 

8. Concerning the Warrant Agent and Other Matters.

 

8.1. Any instructions given to the Warrant
Agent orally, as permitted by any provision of this Warrant Agreement, shall be confirmed in writing by the Company as soon as
practicable. The Warrant Agent shall not be liable or responsible and shall be fully authorized and protected for acting, or failing
to act, in accordance with any oral instructions which do not conform with the written confirmation received in accordance with
this Section 8.1.

 

8.2. (a) Whether or not any Warrants are
exercised, for the Warrant Agent’s services as agent for the Company hereunder, the Company shall pay to the Warrant Agent
such fees as may be separately agreed between the Company and Warrant Agent and the Warrant Agent’s out of pocket expenses
in connection with this Warrant Agreement, including, without limitation, the fees and expenses of the Warrant Agent’s counsel.
While the Warrant Agent endeavors to maintain out-of-pocket charges (both internal and external) at competitive rates, these charges
may not reflect actual out-of-pocket costs, and may include handling charges to cover internal processing and use of the Warrant
Agent’s billing systems.

 

(b) All amounts owed
by the Company to the Warrant Agent under this Warrant Agreement are due within 30 days of the invoice date. Delinquent payments
are subject to a late payment charge of one percent (1.0%) per month commencing 45 days from the invoice date. The Company agrees
to reimburse the Warrant Agent for any attorney’s fees and any other costs associated with collecting delinquent payments.

 

(c) No provision of
this Warrant Agreement shall require Warrant Agent to expend or risk its own funds or otherwise incur any financial liability in
the performance of any of its duties under this Warrant Agreement or in the exercise of its rights.

 

8.3 As agent for the Company hereunder
the Warrant Agent:

 

(a) shall have no
duties or obligations other than those specifically set forth herein or as may subsequently be agreed to in writing by the Warrant
Agent and the Company;

 

(b) shall be regarded
as making no representations and having no responsibilities as to the validity, sufficiency, value, or genuineness of the Warrants
or any Warrant Shares;

 

    	 	11	 

     

    

 

(c) shall not be obligated
to take any legal action hereunder; if, however, the Warrant Agent determines to take any legal action hereunder, and where the
taking of such action might, in its judgment, subject or expose it to any expense or liability it shall not be required to act
unless it has been furnished with an indemnity reasonably satisfactory to it;

 

(d) may rely on and
shall be fully authorized and protected in acting or failing to act upon any certificate, instrument, opinion, notice, letter,
telegram, telex, facsimile transmission or other document or security delivered to the Warrant Agent and believed by it to be genuine
and to have been signed by the proper party or parties;

 

(e) shall not be liable
or responsible for any recital or statement contained in the Registration Statement or any other documents relating thereto;

 

(f) shall not be liable
or responsible for any failure on the part of the Company to comply with any of its covenants and obligations relating to the Warrants,
including without limitation obligations under applicable securities laws;

 

(g) may rely on and
shall be fully authorized and protected in acting or failing to act upon the written, telephonic or oral instructions with respect
to any matter relating to its duties as Warrant Agent covered by this Warrant Agreement (or supplementing or qualifying any such
actions) of officers of the Company, and is hereby authorized and directed to accept instructions with respect to the performance
of its duties hereunder from the Company or counsel to the Company, and may apply to the Company, for advice or instructions in
connection with the Warrant Agent’s duties hereunder, and the Warrant Agent shall not be liable for any delay in acting while
waiting for those instructions; any applications by the Warrant Agent for written instructions from the Company may, at the option
of the Agent, set forth in writing any action proposed to be taken or omitted by the Warrant Agent under this Warrant Agreement
and the date on or after which such action shall be taken or such omission shall be effective; the Warrant Agent shall not be liable
for any action taken by, or omission of, the Warrant Agent in accordance with a proposal included in such application on or after
the date specified in such application (which date shall not be less than five business days after the date such application is
sent to the Company, unless the Company shall have consented in writing to any earlier date) unless prior to taking any such action,
the Warrant Agent shall have received written instructions in response to such application specifying the action to be taken or
omitted;

 

(h) may consult with
counsel satisfactory to the Warrant Agent, including its in-house counsel, and the advice of such counsel shall be full and complete
authorization and protection in respect of any action taken, suffered, or omitted by it hereunder in good faith and in accordance
with the advice of such counsel;

 

(i) may perform any
of its duties hereunder either directly or by or through nominees, correspondents, designees, or subagents, and it shall not be
liable or responsible for any misconduct or negligence on the part of any nominee, correspondent, designee, or subagent appointed
with reasonable care by it in connection with this Warrant Agreement;

 

(j) is not authorized,
and shall have no obligation, to pay any brokers, dealers, or soliciting fees to any person; and

 

(k) shall not be required
hereunder to comply with the laws or regulations of any country other than the United States of America or any political subdivision
thereof.

 

8.4. (a) In the absence of gross negligence
or willful or illegal misconduct on its part, the Warrant Agent shall not be liable for any action taken, suffered, or omitted
by it or for any error of judgment made by it in the performance of its duties under this Warrant Agreement. Anything in this Warrant
Agreement to the contrary notwithstanding, in no event shall Warrant Agent be liable for special, indirect, incidental, consequential
or punitive losses or damages of any kind whatsoever (including but not limited to lost profits), even if the Warrant Agent has
been advised of the possibility of such losses or damages and regardless of the form of action. Any liability of the Warrant Agent
will be limited in the aggregate to the amount of fees paid by the Company hereunder. The Warrant Agent shall not be liable for
any failures, delays or losses, arising directly or indirectly out of conditions beyond its reasonable control including, but not
limited to, acts of government, exchange or market ruling, suspension of trading, work stoppages or labor disputes, fires, civil
disobedience, riots, rebellions, storms, electrical or mechanical failure, computer hardware or software failure, communications
facilities failures including telephone failure, war, terrorism, insurrection, earthquakes, floods, acts of God or similar occurrences.

 

    	 	12	 

     

    

 

(b) In the event any question or dispute
arises with respect to the proper interpretation of the Warrants or the Warrant Agent’s duties under this Warrant Agreement
or the rights of the Company or of any Holder, the Warrant Agent shall not be required to act and shall not be held liable or responsible
for its refusal to act until the question or dispute has been judicially settled (and, if appropriate, it may file a suit in interpleader
or for a declaratory judgment for such purpose) by final judgment rendered by a court of competent jurisdiction, binding on all
persons interested in the matter which is no longer subject to review or appeal, or settled by a written document in form and substance
satisfactory to Warrant Agent and executed by the Company and each such Holder. In addition, the Warrant Agent may require for
such purpose, but shall not be obligated to require, the execution of such written settlement by all

the Holders and all other persons that
may have an interest in the settlement.

 

8.5. The Company covenants to indemnify
the Warrant Agent and hold it harmless from and against any loss, liability, claim or expense (“Loss”) arising
out of or in connection with the Warrant Agent’s duties under this Warrant Agreement, including the costs and expenses of
defending itself against any Loss, unless such Loss shall have been determined by a court of competent jurisdiction to be a result
of the Warrant Agent’s gross negligence or willful misconduct.

 

8.6. Unless terminated earlier by the parties
hereto, this Agreement shall terminate 90 days after the earlier of the Expiration Date and the date on which no Warrants remain
outstanding (the “Termination Date”). On the business day following the Termination Date, the Agent shall deliver
to the Company any entitlements, if any, held by the Warrant Agent under this Warrant Agreement. The Agent’s right to be
reimbursed for fees, charges and out-of- pocket expenses as provided in this Section 8 shall survive the termination of this Warrant
Agreement.

 

8.7. If any provision of this Warrant Agreement
shall be held illegal, invalid, or unenforceable by any court, this Warrant Agreement shall be construed and enforced as if such
provision had not been contained herein and shall be deemed an Agreement among the parties to it to the full extent permitted by
applicable law.

 

8.8. The Company represents and warrants
that (a) it is duly incorporated and validly existing under the laws of its jurisdiction of incorporation, (b) the offer and sale
of the Warrants and the execution, delivery and performance of all transactions contemplated thereby (including this Warrant Agreement)
have been duly authorized by all necessary corporate action and will not result in a breach of or constitute a default under the
articles of association, bylaws or any similar document of the Company or any indenture, agreement or instrument to which it is
a party or is bound, (c) this Warrant Agreement has been duly executed and delivered by the Company and constitutes the legal,
valid, binding and enforceable obligation of the Company, (d) the Warrants will comply in all material respects with all applicable
requirements of law and (e) to the best of its knowledge, there is no litigation pending or threatened as of the date hereof in
connection with the offering of the Warrants.

 

8.9. In the event of inconsistency between
this Warrant Agreement and the descriptions in the Registration Statement, as they may from time to time be amended, the terms
of this Warrant Agreement shall control.

 

8.10. Set forth in Annex D hereto
is a list of the names and specimen signatures of the persons authorized to act for the Company under this Warrant Agreement (the
“Authorized Representatives”). The Company shall, from time to time, certify to you the names and signatures
of any other persons authorized to act for the Company under this Warrant Agreement.

 

8.11. Except as expressly set forth elsewhere
in this Warrant Agreement, all notices, instructions and communications under this Agreement shall be in writing, shall be effective
upon receipt and shall be addressed, if to the Company, to its address set forth beneath its signature to this Agreement, or, if
to the Warrant Agent, to VStock Transfer, LLC at 18 Lafayette Place, Woodmere, NY 11598, or to such other address of which a party
hereto has notified the other party.

 

    	 	13	 

     

    

 

8.12. (a) This Warrant Agreement shall
be governed by and construed in accordance with the laws of the State of New York. All actions and proceedings relating to or arising
from, directly or indirectly, this Warrant Agreement may be litigated in courts located within the Borough of Manhattan in the
City and State of New York. The Company hereby submits to the personal jurisdiction of such courts and consents that any service
of process may be made by certified or registered mail, return receipt requested, directed to the Company at its address last specified
for notices hereunder. Each of the parties hereto hereby waives the right to a trial by jury in any action or proceeding arising
out of or relating to this Warrant Agreement.

 

(b) This Warrant Agreement
shall inure to the benefit of and be binding upon the successors and assigns of the parties hereto. This Warrant Agreement may
not be assigned, or otherwise transferred, in whole or in part, by either party without the prior written consent of the other
party, which the other party will not unreasonably withhold, condition or delay; except that (i) consent is not required for an
assignment or delegation of duties by Warrant Agent to any affiliate of Warrant Agent and (ii) any reorganization, merger, consolidation,
sale of assets or other form of business combination by Warrant Agent or the Company shall not be deemed to constitute an assignment
of this Warrant Agreement.

 

(c) No provision of
this Warrant Agreement may be amended, modified or waived, except in a written document signed by both parties. The Company and
the Warrant Agent may amend or supplement this Warrant Agreement without the consent of any Holder for the purpose of curing any
ambiguity, or curing, correcting or supplementing any defective provision contained herein or adding or changing any other provisions
with respect to matters or questions arising under this Agreement as the parties may deem necessary or desirable and that the parties
determine, in good faith, shall not adversely affect the interest of the Holders.

 

8.13 Payment of Taxes. The Company
will from time to time promptly pay all taxes and charges that may be imposed upon the Company or the Warrant Agent in respect
of the issuance or delivery of Warrant Shares upon the exercise of Warrants, but the Company may require the Holders to pay any
transfer taxes in respect of the Warrants or such shares. The Warrant Agent may refrain from registering any transfer of Warrants
or any delivery of any Warrant Shares unless or until the persons requesting the registration or issuance shall have paid to the
Warrant Agent for the account of the Company the amount of such tax or charge, if any, or shall have established to the reasonable
satisfaction of the Company and the Warrant Agent that such tax or charge, if any, has been paid.

 

8.14 Resignation of Warrant Agent.

 

8.14.1. Appointment of Successor Warrant
Agent. The Warrant Agent, or any successor to it hereafter appointed, may resign its duties and be discharged from all further
duties and liabilities hereunder after giving thirty (30) days’ notice in writing to the Company, or such shorter period
of time agreed to by the Company. The Company may terminate the services of the Warrant Agent, or any successor Warrant Agent,
after giving thirty (30) days’ notice in writing to the Warrant Agent or successor Warrant Agent, or such shorter period
of time as agreed. If the office of the Warrant Agent becomes vacant by resignation, termination or incapacity to act or otherwise,
the Company shall appoint in writing a successor Warrant Agent in place of the Warrant Agent. If the Company shall fail to make
such appointment within a period of 30 days after it has been notified in writing of such resignation or incapacity by the Warrant
Agent, then the Warrant Agent or any Holder may apply to any court of competent jurisdiction for the appointment of a successor
Warrant Agent at the Company’s cost. Pending appointment of a successor to such Warrant Agent, either by the Company or by
such a court, the duties of the Warrant Agent shall be carried out by the Company. Any successor Warrant Agent (but not including
the initial Warrant Agent), whether appointed by the Company or by such court, shall be a person organized and existing under the
laws of any state of the United States of America, in good standing, and authorized under such laws to exercise corporate trust
powers and subject to supervision or examination by federal or state authority. After appointment, any successor Warrant Agent
shall be vested with all the authority, powers, rights, immunities, duties, and obligations of its predecessor Warrant Agent with
like effect as if originally named as Warrant Agent hereunder, without any further act or deed, and except for executing and delivering
documents as provided in the sentence that follows, the predecessor Warrant Agent shall have no further duties, obligations, responsibilities
or liabilities hereunder, but shall be entitled to all rights that survive the termination of this Warrant Agreement and the resignation
or removal of the Warrant Agent, including but not limited to its right to indemnity hereunder. If for any reason it becomes necessary
or appropriate or at the request of the Company, the predecessor Warrant Agent shall execute and deliver, at the expense of the
Company, an instrument transferring to such successor Warrant Agent all the authority, powers, and rights of such predecessor Warrant
Agent hereunder; and upon request of any successor Warrant Agent the Company shall make, execute, acknowledge, and deliver any
and all instruments in writing for more fully and effectually vesting in and confirming to such successor Warrant Agent all such
authority, powers, rights, immunities, duties, and obligations.

 

    	 	14	 

     

    

 

8.14.2. Notice of Successor Warrant
Agent. In the event a successor Warrant Agent shall be appointed, the Company shall give notice thereof to the predecessor
Warrant Agent and the transfer agent for the Common Share not later than the effective date of any such appointment.

 

8.14.3. Merger or Consolidation of Warrant
Agent. Any person into which the Warrant Agent may be merged or converted or with which it may be consolidated or any person
resulting from any merger, conversion or consolidation to which the Warrant Agent shall be a party or any person succeeding to
the shareowner services business of the Warrant Agent or any successor Warrant Agent shall be the successor Warrant Agent under
this Warrant Agreement, without any further act or deed. For purposes of this Warrant Agreement, “person” shall mean
any individual, firm, corporation, partnership, limited liability company, joint venture, association, trust or other entity, and
shall include any successor (by merger or otherwise) thereof or thereto.

 

9. Miscellaneous Provisions.

 

9.1. Persons Having Rights under this
Warrant Agreement. Nothing in this Warrant Agreement expressed and nothing that may be implied from any of the provisions hereof
is intended, or shall be construed, to confer upon, or give to, any person or corporation other than the parties hereto and the
Holders any right, remedy, or claim under or by reason of this Warrant Agreement or of any covenant, condition, stipulation, promise,
or agreement hereof.

 

9.2. Examination of the Warrant Agreement.
A copy of this Warrant Agreement shall be available at all reasonable times at the office of the Warrant Agent designated for such
purpose for inspection by any Holder. Prior to such inspection, the Warrant Agent may require any such holder to provide reasonable
evidence of its interest in the Warrants.

 

9.3. Counterparts. This Warrant
Agreement may be executed in any number of original, facsimile or electronic counterparts and each of such counterparts shall for
all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument.

 

9.4. Effect of Headings. The Section
headings herein are for convenience only and are not part of this Warrant Agreement and shall not affect the interpretation thereof.

 

10. Certain Definitions.

 

As used herein, the following terms shall
have the following meanings:

 

(i) “Adjustment Right”
means any right granted with respect to any securities issued in connection with, or with respect to, any issuance, sale or delivery
(or deemed issuance, sale or delivery in accordance with Section 4) of Common Share (other than rights of the type described in
Section 4.2 and 4.3 hereof) that could result in a decrease in the net consideration received by the Company in connection with,
or with respect to, such securities (including, without limitation, any cash settlement rights, cash adjustment or other similar
rights) but excluding anti-dilution and other similar rights (including pursuant to Section 4.4 of this Agreement).

  

(ii) “Trading Day” means
any day on which the Common Share is traded on the Trading Market, or, if the Trading Market is not the principal trading market
for the Common Share, then on the principal securities exchange or securities market in the United States on which the Common Share
is then traded, provided that “Trading Day” shall not include any day on which the Common Share is are scheduled to
trade on such exchange or market for less than 4.5 hours or any day that the Common Share is suspended from trading during the
final hour of trading on such exchange or market (or if such exchange or market does not designate in advance the closing time
of trading on such exchange or market, then during the hour ending at 4:00 P.M., New York City time).

 

(iii) “Trading Market”
means NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market or the New York Stock
Exchange.

 

    	 	15	 

     

    

 

(iv) “VWAP” means, for
any date, the price determined by the first of the following clauses that applies: (a) if the Common Share is then listed or quoted
on a Trading Market, the daily volume weighted average price of the Common Share for such date (or the nearest preceding date)
on the Trading Market on which the Common Share is then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day
from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading Market, the volume
weighted average price of the Common Share for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if
the Common Share is not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Common Share are then reported
in the “Pink Sheets” published by OTC Markets Group, Inc. (or a similar organization or agency succeeding to its functions
of reporting prices), the most recent bid price per share of the Common Share so reported, or (d) in all other cases, the fair
market value of a share of Common Share as determined by an independent appraiser selected in good faith by the holders of a majority
in interest of the Warrants then outstanding and reasonably acceptable to the Company, the fees and expenses of which shall be
paid by the Company.

 

[SIGNATURE PAGE FOLLOWS]

 

 

    	 	16	 

     

    

 

IN WITNESS WHEREOF, this Warrant Agent Agreement has been duly
executed by the parties hereto as of the day and year first above written.

 

	 	Electrameccanica Vehicles Corp.

  

	 	By:	 
	 	Name: 	 
	 	Title:	 

 

	 	VStock Transfer, LLC

 

	 	By:	 
	 	Name: 	 
	 	Title:	 

 

Annex A - Form of Global Certificate

Annex B - Election to Purchase

Annex C - Form of Certificated Warrant

Annex D - Authorized Representatives

Annex E - Form of Warrant Certificate Request
Notice

 

    	 	17	 

     

    

 

ANNEX A

 

[FORM OF GLOBAL

CERTIFICATE]

 

UNLESS THIS CERTIFICATE IS PRESENTED
BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO ISSUER OR ITS AGENT
FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER
ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE
BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

ELECTRAMECCANICA VEHICLES CORP.

WARRANT CERTIFICATE

NOT EXERCISABLE AFTER AUGUST 13, 2023

 

This certifies that
the person whose name and address appears below, or registered assigns, is the registered owner of the number of Warrants set forth
below. Each Warrant entitles its registered holder to purchase from ELECTRAMECCANICA VEHICLES CORP., a British Columbia corporation
(the “Company”), at any time prior to 5:00 P.M. (New York City time) on August 13, 2023, one common share, no
par value, of the Company (each, a “Warrant Share” and collectively, the “Warrant Shares”),
at an exercise price of $4.25 per share, subject to possible adjustments as provided in the Warrant Agreement (as defined below).

 

This Warrant Certificate,
with or without other Warrant Certificates, upon surrender at the designated office of the Warrant Agent, may be exchanged for
another Warrant Certificate or Warrant Certificates evidencing the same number of Warrants as the Warrant Certificate or Warrant
Certificates surrendered. A transfer of the Warrants evidenced hereby may be registered upon surrender of this Warrant Certificate
at the designated office of the Warrant Agent by the registered holder in person or by a duly authorized attorney, properly endorsed
or accompanied by proper instruments of transfer, a signature guarantee, and such other and further documentation as the Warrant
Agent may reasonably request and duly stamped as may be required by the laws of the State of New York and of the United States
of America.

 

The terms and conditions
of the Warrants and the rights and obligations of the holder of this Warrant Certificate are set forth in the Warrant Agent Agreement
dated as of August 9, 2018 (the “Warrant Agreement”) between the Company and VStock Transfer, LLC (the “Warrant
Agent”). A copy of the Warrant Agreement is available for inspection during business hours at the office of the Warrant
Agent.

 

This Warrant Certificate
shall not be valid or obligatory for any purpose until it shall have been countersigned by an authorized signatory of the Warrant
Agent.

 

(Signature Page Follows)

 

    	 	18	 

     

    

 

WITNESS the facsimile
signature of a proper officer of the Company.

 

	 	ELECTRAMECCANICA VEHICLES CORP.

 

	 	By:	 
	 	Name: 	 
	 	Title	 

 

Dated August 13, 2018

 

Countersigned:

 

	VStock Transfer, LLC, As Warrant Agent	 
	 	 	 
	By:	 	 
	Name: 	 	 
	Title:	 	 

 

PLEASE 

DETACH HERE

——————————————————————————————————————

 

Certificate No.:________Number of Warrants:________

 

WARRANT CUSIP NO.: 284849114

 

	 	ELECTRAMECCANICA VEHICLES CORP. 
	 	 
	[Name & Address of Holder]	[●]
	 	 
	 	By Mail:
	 	 
	 	By hand or overnight courier:

 

    	 	19	 

     

    

 

ANNEX B

 

NOTICE OF EXERCISE

 

	 	TO:	ELECTRAMECCANICA VEHICLES CORP.

 

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

 

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

 

 ̈
in lawful money of the United States; or

 

 ̈
if permitted the cancellation of such number of Warrant Shares as is necessary, in accordance with the formula set forth in subsection
3.37, to exercise this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise
procedure set forth in subsection 3.3.7.

 

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

 

_________________________________

 

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

 

_________________________________

 

_________________________________

 

_________________________________

 

[SIGNATURE OF HOLDER]

 

Name of Investing Entity: _______________________________________________

 

Signature of Authorized Signatory of Investing Entity:
_________________________________________

 

Name of Authorized Signatory: _________________________________________

 

Title of Authorized Signatory: _________________________________________

 

Date: _________________________________________

 

    	 	20	 

     

    

 

ANNEX C

 

[FORM OF CERTIFICATED WARRANT] 

COMMON SHARE PURCHASE WARRANT

ELECTRAMECCANICA VEHICLES CORP.

 

	Warrant Shares:	Initial Exercise Date: August 13, 2018
	 	Issue Date: August 13, 2018

 

CUSIP: 284849114

 

ISIN: CA2848491148

 

THIS COMMON SHARE PURCHASE
WARRANT (the “Warrant”) certifies that, for value received, __________________ or its assigns (the “Holder”)
is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter set forth, at any time on
or after August 13, 2018 (the “Initial Exercise Date”) and on or prior to 5:00 p.m. (New York City time) on the five
(5) year anniversary of the Initial Exercise Date (the “Termination Date”) but not thereafter, to subscribe for and
purchase from Electrameccanica Vehicles Corp., a British Columbia corporation (the “Company”), up to_____________ Common
Shares (as subject to adjustment hereunder, the “Warrant Shares”). The purchase price of one Common Share under this
Warrant shall be equal to the Exercise Price, as defined in Section 2(b). This Warrant shall initially be issued and maintained
in the form of a security held in book-entry form and the Depository Trust Company or its nominee (“DTC”) shall initially
be the sole registered holder of this Warrant, subject to a Holder’s right to elect to receive a Warrant in certificated
form pursuant to the terms of the Warrant Agent Agreement, in which case this sentence shall not apply.

 

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

 

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

 

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

 

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

 

“Common Share”
means the common stock of the Company, no par value, and any other class of securities into which such securities may hereafter
be reclassified or changed.

 

“Common Share
Equivalents” means any securities of the Company or the Subsidiaries which would entitle the holder thereof to acquire
at any time Common Share, including, without limitation, any debt, preferred stock, right, option, warrant or other instrument
that is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Common
Share

 

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

 

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

 

“Proceeding”
means an action, claim, suit, investigation or proceeding (including, without limitation, an informal investigation or partial
proceeding, such as a deposition), whether commenced or threatened.

 

    	 	21	 

     

    

 

“Registration
Statement” means the Company’s registration statement on Form F-1 (File No. 333-222814).

 

“Rule 144”
means Rule 144 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from time
to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect
as such Rule.

 

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

 

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

 

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

 

“Transfer
Agent” means VStock Transfer, LLC, with a mailing address of 18 Lafayette Place, Woodmere, NY 11598, and any successor
transfer agent of the Company.

 

“Warrant Agent
Agreement” means that certain Warrant Agent Agreement, dated as of the Initial Exercise Date, between the Company and
the Warrant Agent.

 

“Warrant Agent”
means the Transfer Agent and any successor warrant agent of the Company.

 

“Warrants”
means this Warrant and other Common Share Purchase Warrants issued by the Company pursuant to the Registration Statement.

 

Section 2.             Exercise.

 

a)           Exercise
of the purchase rights represented by this Warrant may be made, in whole or in Section 2(d)(i)) following the date of exercise
as aforesaid, the Holder shall deliver the aggregate Exercise Price for the shares specified in the applicable Notice of Exercise
by wire transfer or cashier’s check drawn on a United States bank unless the cashless exercise procedure specified in Section
2(c) below is specified in the applicable Notice of Exercise. No ink-original Notice of Exercise shall be required, nor shall any
medallion guarantee (or other type of guarantee or notarization) of any Notice of Exercise form be required. Notwithstanding anything
herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company until the Holder has
purchased all of the Warrant Shares available hereunder and the Warrant has been exercised in full, in which case, the Holder shall
surrender this Warrant to the Company for cancellation within three (3) Trading Days of the date the final Notice of Exercise is
delivered to the Company. Partial exercises of this Warrant resulting in purchases of a portion of the total number of Warrant
Shares available hereunder shall have the effect of lowering the outstanding number of Warrant Shares purchasable hereunder in
an amount equal to the applicable number of Warrant Shares purchased. The Holder and the Company shall maintain records showing
the number of Warrant Shares purchased and the date of such purchases. The Company shall deliver any objection to any Notice of
Exercise within one (1) Trading Day of receipt of such notice. The Holder and any assignee, by acceptance of this Warrant, acknowledge
and agree that, by reason of the provisions of this paragraph, following the purchase of a portion of the Warrant Shares hereunder,
the number of Warrant Shares available for purchase hereunder at any given time may be less than the amount stated on the face
hereof.

 

Notwithstanding the foregoing in this Section
2(a), a holder whose interest in this Warrant is a beneficial interest in certificate(s) representing this Warrant held in book-entry
form through DTC (or another established clearing corporation performing similar functions), shall effect exercises made pursuant
to this Section 2(a) by delivering to DTC (or such other clearing corporation, as applicable) the appropriate instruction form
for exercise, complying with the procedures to effect exercise that are required by DTC (or such other clearing corporation, as
applicable), subject to a Holder’s right to elect to receive a Warrant in certificated form pursuant to the terms of the
Warrant Agent Agreement, in which case this sentence shall not apply.

 

    	 	22	 

     

    

 

b)            Exercise
Price. The exercise price per share of the Common Share under this Warrant shall be $4.25, subject to adjustment hereunder
(the “Exercise Price”).

 

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

 

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

 

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

 

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

 

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

 

“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Share is then listed
or quoted on a Trading Market, the daily volume weighted average price of the Common Share for such date (or the nearest preceding
date) on the Trading Market on which the Common Share is then listed or quoted as reported by Bloomberg L.P. (based on a Trading
Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading Market, the
volume weighted average price of the Common Share for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable,
(c) if the Common Share is not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Common Share are then
reported in the “Pink Sheets” published by OTC Markets Group, Inc. (or a similar organization or agency succeeding
to its functions of reporting prices), the most recent bid price per share of the Common Share so reported, or (d) in all other
cases, the fair market value of a share of Common Share as determined by an independent appraiser selected in good faith by the
holders of a majority in interest of the Warrants then outstanding and reasonably acceptable to the Company, the fees and expenses
of which shall be paid by the Company.

 

Notwithstanding anything
herein to the contrary, on the Termination Date, this Warrant shall be automatically exercised via cashless exercise pursuant to
this Section 2(c).

 

    	 	23	 

     

    

 

d)            Mechanics
of Exercise.

 

i.           Delivery
of Warrant Shares Upon Exercise. The Company shall cause the Warrant Shares purchased hereunder to be transmitted by the Transfer
Agent to the Holder by crediting the account of the Holder’s or its designee’s balance account with The Depository
Trust Company through its Deposit or Withdrawal at Custodian system (“DWAC”) if the Company is then a participant
in such system and either (A) there is an effective registration statement permitting the issuance of the Warrant Shares to or
resale of the Warrant Shares by Holder or (B) this Warrant is being exercised via cashless exercise, and otherwise by physical
delivery of a certificate, registered in the Company’s share register in the name of the Holder or its designee, for the
number of Warrant Shares to which the Holder is entitled pursuant to such exercise to the address specified by the Holder in the
Notice of Exercise by the date that is earlier of (i) two (2) Trading Days after the delivery to the Company of the Notice of Exercise
and (ii) the number of Trading Days comprising the Standard Settlement Period after the delivery to the Company of the Notice of
Exercise (such date, the “Warrant Share Delivery Date”). Upon delivery of the Notice of Exercise, the Holder
shall be deemed for all corporate purposes to have become the holder of record of the Warrant Shares with respect to which this
Warrant has been exercised, irrespective of the date of delivery of the Warrant Shares, provided that payment of the aggregate
Exercise Price (other than in the case of a cashless exercise) is received within the earlier of (i) two (2) Trading Days and (ii)
the number of Trading Days comprising the Standard Settlement Period following the delivery of the Notice of Exercise. If the Company
fails for any reason to deliver to the Holder the Warrant Shares subject to a Notice of Exercise by the Warrant Share Delivery
Date, the Company shall pay to the Holder, in cash, as liquidated damages and not as a penalty, for each $1,000 of Warrant Shares
subject to such exercise (based on the VWAP of the Common Share on the date of the applicable Notice of Exercise), $10 per Trading
Day (increasing to $20 per Trading Day on the fifth Trading Day after such liquidated damages begin to accrue) for each Trading
Day after such Warrant Share Delivery Date until such Warrant Shares are delivered or Holder rescinds such exercise. The Company
agrees to maintain a transfer agent that is a participant in the FAST program so long as this Warrant remains outstanding and exercisable.
As used herein, “Standard Settlement Period” means the standard settlement period, expressed in a number of
Trading Days, on the Company’s primary Trading Market with respect to the Common Share as in effect on the date of delivery
of the Notice of Exercise.

 

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

 

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

 

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

 

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

 

    	 	24	 

     

    

 

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

 

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

  

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

 

    	 	25	 

     

    

 

Section 3.          Certain
Adjustments.

 

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

 

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

 

c)             Pro
Rata Distributions. During such time as this Warrant is outstanding, if the Company shall declare or make any dividend or other
distribution of its assets (or rights to acquire its assets) to holders of Common Shares, by way of return of capital or otherwise
(including, without limitation, any distribution of cash, stock or other securities, property or options by way of a dividend,
spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a "Distribution"),
at any time after the issuance of this Warrant, then, in each such case, the Holder shall be entitled to participate in such Distribution
to the same extent that the Holder would have participated therein if the Holder had held the number of Common Shares acquirable
upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including without limitation, the
Beneficial Ownership Limitation) immediately before the date of which a record is taken for such Distribution, or, if no such record
is taken, the date as of which the record holders of Common Shares are to be determined for the participation in such Distribution
(provided, however, to the extent that the Holder's right to participate in any such Distribution would result in
the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Distribution
to such extent (or in the beneficial ownership of any Common Shares as a result of such Distribution to such extent) and the portion
of such Distribution shall be held in abeyance for the benefit of the Holder until such time, if ever, as its right thereto would
not result in the Holder exceeding the Beneficial Ownership Limitation).

  

    	 	26	 

     

    

 

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

 

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

 

    	 	27	 

     

    

 

f)            Notice
to Holder.

 

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

  

ii.           Notice
to Allow Exercise by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever form) on the
Common Share, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common Share, (C) the
Company shall authorize the granting to all holders of the Common Share rights or warrants to subscribe for or purchase any shares
of capital stock of any class or of any rights, (D) the approval of any stockholders of the Company shall be required in connection
with any reclassification of the Common Share, any consolidation or merger to which the Company is a party, any sale or transfer
of all or substantially all of the assets of the Company, or any compulsory share exchange whereby the Common Share is converted
into other securities, cash or property, or (E) the Company shall authorize the voluntary or involuntary dissolution, liquidation
or winding up of the affairs of the Company, then, in each case, the Company shall cause to be delivered by facsimile or email
to the Holder at its last facsimile number or email address as it shall appear upon the Warrant Register of the Company, at least
20 calendar days prior to the applicable record or effective date hereinafter specified, a notice stating (x) the date on which
a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants, or if a record is not to
be taken, the date as of which the holders of the Common Share of record to be entitled to such dividend, distributions, redemption,
rights or warrants are to be determined or (y) the date on which such reclassification, consolidation, merger, sale, transfer or
share exchange is expected to become effective or close, and the date as of which it is expected that holders of the Common Share
of record shall be entitled to exchange their Common Shares for securities, cash or other property deliverable upon such reclassification,
consolidation, merger, sale, transfer or share exchange; provided that the failure to deliver such notice or any defect therein
or in the delivery thereof shall not affect the validity of the corporate action required to be specified in such notice. To the
extent that any notice provided in this Warrant constitutes, or contains, material, non-public information regarding the Company
or any of the Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to a Current Report
on Form 8-K. The Holder shall remain entitled to exercise this Warrant during the period commencing on the date of such notice
to the effective date of the event triggering such notice except as may otherwise be expressly set forth herein.

 

Section 4.           Transfer
of Warrant.

 

a)             Transferability.
This Warrant and all rights hereunder are transferable, in whole or in part, upon surrender of this Warrant at the principal office
of the Company or its designated agent, together with a written assignment of this Warrant substantially in the form attached hereto
duly executed by the Holder or its agent or attorney and funds sufficient to pay any transfer taxes payable upon the making of
such transfer. Upon such surrender and, if required, such payment, the Company shall execute and deliver a new Warrant or Warrants
in the name of the assignee or assignees, as applicable, and in the denomination or denominations specified in such instrument
of assignment, and shall issue to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant
shall promptly be cancelled. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender
this Warrant to the Company unless the Holder has assigned this Warrant in full, in which case, the Holder shall surrender this
Warrant to the Company within three (3) Trading Days of the date the Holder delivers an assignment form to the Company assigning
this Warrant full. The Warrant, if properly assigned in accordance herewith, may be exercised by a new holder for the purchase
of Warrant Shares without having a new Warrant issued.

 

b)            New
Warrants. If this Warrant is not held in global form through DTC (or any successor depository), this Warrant may be divided
or combined with other Warrants upon presentation hereof at the aforesaid office of the Company, together with a written notice
specifying the names and denominations in which new Warrants are to be issued, signed by the Holder or its agent or attorney. Subject
to compliance with Section 4(a), as to any transfer which may be involved in such division or combination, the Company shall execute
and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided or combined in accordance with such
notice. All Warrants issued on transfers or exchanges shall be dated the original Initial Exercise Date of this Warrant and shall
be identical with this Warrant except as to the number of Warrant Shares issuable pursuant thereto.

 

    	 	28	 

     

    

 

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

 

Section 5.          Miscellaneous.

 

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

 

b)            Loss,
Theft, Destruction or Mutilation of Warrant. The Company covenants that upon receipt by the Company of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any stock certificate relating to the Warrant
Shares, and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it, and upon surrender and
cancellation of such Warrant or stock certificate, if mutilated, the Company will make and deliver a new Warrant or stock certificate
of like tenor and dated as of such cancellation, in lieu of such Warrant or stock certificate.

 

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

 

d)            Authorized
Shares.

 

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

 

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

 

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

 

    	 	29	 

     

    

 

e)            Governing
Law. All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be governed
by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of
conflict of laws thereof. Each party agrees that all legal Proceedings concerning the interpretation, enforcement and defense of
this Warrant shall be commenced in the state and federal courts sitting in the City of New York, Borough of Manhattan (the “New
York Courts”). Each party hereto hereby irrevocably submits to the exclusive jurisdiction of the New York Courts 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 provision hereunder), 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 such New York Courts, or
such New York Courts are improper or inconvenient venue for such Proceeding. Each party hereto hereby irrevocably waives, to the
fullest extent permitted by applicable law, any and all right to trial by jury in any legal Proceeding arising out of or relating
to this Warrant. If any party shall commence an action or Proceeding to enforce any provisions of this Warrant, then the prevailing
party in such action or Proceeding shall be reimbursed by the other party for its attorneys’ fees and other costs and expenses
incurred in the investigation, preparation and prosecution of such action or Proceeding.

 

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

 

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

 

h)            Notices.
Any and all notices or other communications or deliveries to be provided by the Holders hereunder including, without limitation,
any Notice of Exercise, shall be in writing and delivered personally, by facsimile or by e-mail, or sent by a nationally recognized
overnight courier service, addressed to the Company, at 102 East 1st Avenue Vancouver, British Columbia, Canada, V5T
1A4 , Attention: Isaac Moss, email address: isaac.moss@electrameccanica.com, or such other facsimile number, email address
or address as the Company may specify for such purposes by notice to the Holders. Any and all notices or other communications or
deliveries to be provided by the Company hereunder shall be in writing and delivered personally, by facsimile, or sent by a nationally
recognized overnight courier service addressed to each Holder at the facsimile number or address of such Holder appearing on the
books of the Warrant Agent. Any notice or other communication or deliveries hereunder shall be deemed given and effective on the
earliest of (i) the time of transmission, if such notice or communication is delivered via facsimile at the facsimile number or
e-mail at the e-mail address set forth in this Section prior to 5:30 p.m. (New York City time) on any date, (ii) the next Trading
Day after the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number or e-mail
at the e-mail address set forth in this Section on a day that is not a Trading Day or later than 5:30 p.m. (New York City time)
on any Trading Day, (iii) the second Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight
courier service, or (iv) upon actual receipt by the party to whom such notice is required to be given. Notwithstanding any other
provision of this Warrant, where this Warrant provides for notice of any event to the Holder, if this Warrant is held in global
form by DTC (or any successor depositary), such notice shall be sufficiently given if given to DTC (or any successor depositary)
pursuant to the procedures of DTC (or such successor depositary), subject to a Holder’s right to elect to receive a Warrant
in certificated form pursuant to the terms of the Warrant Agent Agreement, in which case this sentence shall not apply.

 

i)            Warrant
Agent Agreement. If this Warrant is held in global form through DTC (or any successor depositary), this Warrant is issued subject
to the Warrant Agent Agreement. To the extent any provision of this Warrant conflicts with the express provisions of the Warrant
Agent Agreement, the provisions of this Warrant shall govern and be controlling.

 

    	 	30	 

     

    

 

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

 

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

 

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

 

m)            Amendment.
This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company, on the one hand,
and the Holder or the beneficial owner of this Warrant, on the other hand.

 

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

 

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

 

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

 

(Signature Page Follows)

 

    	 	31	 

     

    

 

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

 

	 	ELECTRAMECCANICA VEHICLES CORP. 

 

	 	By:	 
	 	Name: 	 
	 	Title	 

 

    	 	32	 

     

    

 

NOTICE OF EXERCISE

 

	TO:		Electrameccanica Vehicles Corp.

 

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

 

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

 

 ̈
in lawful money of the United States; or

 

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

 

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

 

	 
	 

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

 

	 
	 
	 
	 
	 

 

[SIGNATURE OF HOLDER]

 

Name of Investing Entity: _______________________________________________

 

Signature of Authorized Signatory of Investing Entity:
_________________________________________

 

Name of Authorized Signatory: _________________________________________

 

Title of Authorized Signatory: _________________________________________

 

Date: _________________________________________

 

    	 	33	 

     

    

 

ASSIGNMENT FORM

 

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

 

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

 

	Name: 	 	 
	 	(Please Print) 	 
	 	 	 
	Address: 	 	 
	 	(Please Print) 	 

 

	Phone Number : 	 	 
	 	(Please Print) 	 
	 	 	 
	Email Address : 	 	 
	 	(Please Print) 	 

 

Dated: ________

 

Holder’s Signature: ________________

 

	Holder’s Address: 	 	 
	 	(Please Print) 	 

 

    	 	34	 

     

    

 

ANNEX D

 

AUTHORIZED

REPRESENTATIVES

 

	Name	 	Title	 	Signature
	 	 	 	 	 

 

    	 	35	 

     

    

 

Annex E: Form of Warrant Certificate
Request Notice

 

WARRANT CERTIFICATE REQUEST NOTICE

 

	 	To:	as Warrant Agent for Electrameccanica Vehicles Corp. (the “Company”)

 

The undersigned Holder of Common Share
Purchase Warrants (“Warrants”) in the form of Global Warrants issued by the Company hereby elects to receive a Definitive
Certificate evidencing the Warrants held by the Holder as specified below:

 

	 	1)	Name of Holder of Warrants in form of Global Warrants:

 

	 	2)	Name of Holder in Definitive Certificate (if different from name of Holder of Warrants in form of Global Warrants):

 

	 	3)	Number of Warrants in name of Holder in form of Global Warrants:

 

	 	4)	Number of Warrants for which Definitive Certificate shall be issued:

 

	 	5)	Number of Warrants in name of Holder in form of Global Warrants after issuance of

 

Definitive Certificate, if any:

 

	 	6)	Definitive Certificate shall be delivered to the following address:

 

	 
	 
	 
	 
	 
	 
	 

 

The undersigned hereby acknowledges and
agrees that, in connection with this Warrant Exchange and the issuance of the Definitive Certificate, the Holder is deemed to have
surrendered the number of Warrants in form of Global Warrants in the name of the Holder equal to the number of Warrants evidenced
by the Definitive Certificate.

 

[SIGNATURE OF HOLDER]

 

Name of Investing Entity: _____________________________________

 

Signature of Authorized Signatory of Investing Entity: _____________________________

 

Name of Authorized Signatory: _____________________________________

 

Title of Authorized Signatory: _____________________________________

 

Date:____________________________________

 

    	 	36Exhibit 10.1

 

EGALET CORPORATION

 

2013 STOCK-BASED

INCENTIVE COMPENSATION PLAN

 

(as amended and restated effective April 5, 2018)

 

 

EGALET CORPORATION

 

2013 STOCK-BASED

INCENTIVE COMPENSATION PLAN

(as amended and restated effective April 5, 2018)

 

1.                                      Purpose of the Plan

 

The purpose of the Plan is to assist the Company, its Subsidiaries and Affiliates in attracting and retaining valued Employees, Consultants and Non-Employee Directors by offering them a greater stake in the Company’s success and a closer identity with it, and to encourage ownership of the Company’s stock by such Employees, Consultants and Non-Employee Directors.

 

2.                                      Definitions

 

As used herein, the following definitions shall apply:

 

2.1.                            “Affiliate” means any entity other than the Subsidiaries in which the Company has a substantial direct or indirect equity interest, as determined by the Board.

 

2.2.                            “Award” means a grant of Common Stock, Deferred Stock, Restricted Stock, Restricted Stock Units, Options or SARs under the Plan.

 

2.3.                            “Award Agreement” means the written agreement, instrument or document evidencing an Award, including any such item in an electronic medium.

 

2.4.                            “Board” means the Board of Directors of the Company.

 

2.5.                            “Change in Control” means, after the Effective Date (and not including the public offering of the Company, which shall not be treated as a Change in Control for purposes of the Plan), any of the following events:

 

 

(a)                                 a “person” (as such term in used in Sections 13(d) and 14(d) of the 1934 Act), other than a trustee or other fiduciary holding securities under an employee benefit plan of the Company or a corporation owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of stock of the Company, is or becomes the “beneficial owner” (as defined in Rule 13D-3 under the 1934 Act), directly or indirectly, of securities of the Company representing fifty percent (50%) or more of the combined voting power of the Company’s then outstanding securities; or

 

(b)                                 during any period of two consecutive years, individuals who at the beginning of such period constitute the Board and any new director (other than a director designated by a person who has entered into an agreement with the Company to effect a transaction described in Section 2.5(a), Section 2.5(c) or Section 2.5(d) hereof) whose election by the Board or nomination for election by the Company’s stockholders was approved by a vote of at least two-thirds of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously approved, cease for any reason to constitute a majority thereof; or

 

(c)                                  the Company merges or consolidates with any other corporation, other than in a merger or consolidation that would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) at least fifty percent (50%) of the combined voting power of the voting securities of the Company or such surviving entity outstanding immediately after such merger or consolidation; or

 

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(d)                                 the complete liquidation of the Company or the sale or other disposition of all or substantially all of the Company’s assets.

 

(e)                                  Notwithstanding anything in the Plan or an Award Agreement to the contrary, if an Award is subject to Section 409A of the Code, no event that, but for this Section, would be a Change in Control as defined in the Plan or the Award Agreement, as applicable, shall be a Change in Control unless such event is also a “change in control event” as defined in Section 409A of the Code.

 

2.6.                            “Code” means the Internal Revenue Code of 1986, as amended, and the Treasury regulations promulgated thereunder.  A reference to any provision of the Code or the Treasury regulations promulgated thereunder shall include reference to any successor provision of the Code or the Treasury regulations.

 

2.7.                            “Committee” means the committee designated by the Board to administer the Plan under Section 4.  The Committee shall have at least two members and each member of the Committee shall be a Non-Employee Director, an Outside Director and an “independent director” within the meaning of Rule 5605(a)(2) of the NASDAQ Stock Market Equity Rules.

 

2.8.                            “Common Stock” means the common stock of the Company, par value $0.001 per share, or such other class or kind of shares or other securities resulting from the application of Section 13.

 

2.9.                            “Company” means Egalet Corporation, a Delaware corporation, or any successor corporation.

 

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2.10.                     “Consultant” means an individual who renders services to the Company, a Subsidiary or an Affiliate as a consultant, advisor or independent contractor.

 

2.11.                     “Deferral Period” means the period during which the receipt of a Deferred Stock Award under Section 7 will be deferred.

 

2.12.                     “Deferred Stock” means Common Stock to be delivered at the end of a Deferral Period and awarded by the Committee under Section 7.

 

2.13.                     “Effective Date” has the meaning set forth in Section 25.

 

2.14.                     “Employee” means an individual, including an officer or director, who is employed by the Company, a Subsidiary or an Affiliate.

 

2.15.                     “Fair Market Value” means the fair market value of Common Stock determined by such methods or procedures as shall be established from time to time by the Committee in good faith and in accordance with applicable law.  Unless otherwise determined by the Committee, the Fair Market Value of Common Stock shall mean, on any given date, the closing price of a share of Common Stock on the principal national securities exchange on which the Common Stock is listed on such date or, if Common Stock was not traded on such date, on the last preceding day on which the Common Stock was traded.

 

2.16.                     “Incentive Stock Option” means an Option or a portion thereof intended to meet the requirements of an incentive stock option as defined in Section 422 of the Code and designated as an Incentive Stock Option in the applicable Award Agreement.

 

2.17.                     “1934 Act” means the Securities Exchange Act of 1934, as amended, and the rules promulgated thereunder.  A reference to any provision of the 1934 Act or rule promulgated under the 1934 Act shall include reference to any successor provision or rule.

 

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2.18.                     “Non-Employee Director” means a member of the Board who meets the definition of a “non-employee director” under Rule 16b-3(b)(3) promulgated by the Securities and Exchange Commission under the 1934 Act.

 

2.19.                     “Non-Qualified Option” means an Option or a portion thereof not intended to be an Incentive Stock Option and designated as a Non-Qualified Option in the applicable Award Agreement.

 

2.20.                     “Option” means a right to purchase a specified number of shares of Common Stock at a specified price awarded by the Committee under Section 6 of the Plan.

 

2.21.                     “Outside Director” means a member of the Board who meets the definition of an “outside director” under Section 162(m) of the Code.

 

2.22.                     “Participant” means any Employee, Consultant or Non-Employee Director who receives an Award.

 

2.23.                     “Performance Cycle” means the period selected by the Committee during which the performance of the Company, any Subsidiary, any Affiliate or any business unit thereof, or any individual is measured for the purpose of determining the extent to which a Performance Goal has been achieved.

 

2.24.                     “Performance Goal” means a goal that must be met by the end of a period specified by the Committee (but that is substantially uncertain of being met before the grant of the Award) and that, in the case of Qualified Performance-Based Awards, must be based upon any one or more of the following as they relate to the Company, its Subsidiaries or Affiliates (or any business unit or department thereof): (i) stock price, (ii) market share, (iii) sales, (iv) earnings per share, (v) diluted earnings per share, (vi) diluted net income per share,

 

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(vii) return on shareholder equity, (viii) costs, (ix) cash flow, (x) return on total assets, (xi) return on capital or invested capital, (xii) return on net assets, (xiii) operating income, (xiv) net income, (xv) earnings (or net income) before interest, taxes, depreciation and amortization, (xvi) improvements in capital structure, (xvii) gross, operating or other margins, (xviii) budget and expense management, (xix) productivity ratios, (xx) working capital targets, (xxi) enterprise value, (xxii) safety record, (xxiii) completion of acquisitions or business expansion of the company, our subsidiaries or affiliates (or any business unit or department thereof) (xxiv) economic value added or other value added measurements, (xxv) expenses targets, (xxvi) operating efficiency, (xxvii) regulatory body approvals for commercialization of products,  (xxviii) implementation or completion of critical projects or related milestones (including, without limitation, milestones such as clinical trial enrollment targets, commencement of phases of clinical trials and completion of phases of clinical trials) or (xxix) partnering or similar transactions, in all cases, whether measured absolutely or relative to an index or peer group.  The Committee shall have discretion to determine the specific targets with respect to each of these categories of Performance Goals.  Performance Goals with respect to Awards that are not intended to be Qualified Performance-Based Awards may be based on one or more of the preceding measures or any other measure that the Committee may determine in its sole discretion.  If the Committee determines that a change in the business, operations, corporate structure or capital structure of the Company, or the manner in which it conducts its business, or other events or circumstances render the Performance Goals unsuitable, the Committee may modify such Performance Goals or the related minimum acceptable level of achievement, in whole or in part, as the Committee deems appropriate and equitable.

 

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2.25.                     “Plan” means the Egalet Corporation 2013 Stock-Based Incentive Compensation Plan herein set forth, as amended and/or restated from time to time.

 

2.26.                     “Qualified Performance-Based Award” means an Award or portion of an Award that is intended to satisfy the requirements for “qualified performance-based compensation” under Section 162(m) of the Code.

 

2.27.                     “Restricted Stock” means Common Stock awarded by the Committee under Section 8 of the Plan.

 

2.28.                     “Restricted Stock Unit” means the right to a payment in Common Stock or in cash, or in a combination thereof, awarded by the Committee under Section 9 of the Plan.

 

2.29.                     “Restriction Period” means the period during which Restricted Stock awarded under Section 8 of the Plan and Restricted Stock Units awarded under Section 9 of the Plan are subject to forfeiture.

 

2.30.                     “SAR” means a stock appreciation right awarded by the Committee under Section 11 of the Plan.

 

2.31.                     “Subsidiary” means any corporation (other than the Company), partnership, joint venture or other business entity of which 50% or more of the outstanding voting power is beneficially owned, directly or indirectly, by the Company.

 

2.32.                     “Ten Percent Shareholder” means a person who on any given date owns, either directly or indirectly (taking into account the attribution rules contained in Section 424(d) of the Code), stock possessing more than 10% of the total combined voting power of all classes of stock of the Company or a Subsidiary.

 

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3.                                      Eligibility

 

Any Employee, Consultant or Non-Employee Director is eligible to receive an Award.

 

4.                                      Administration and Implementation of Plan

 

4.1.                            The Plan shall be administered by the Committee.  Any action of the Committee in administering the Plan shall be final, conclusive and binding on all persons, including the Company, its Subsidiaries and Affiliates, their Employees, Consultants and directors, Participants, persons claiming rights from or through Participants and stockholders of the Company.  No member of the Committee shall be personally liable for any action, determination, or interpretation taken or made in good faith by the Committee with respect to the Plan or any Awards granted hereunder, and all members of the Committee shall be fully indemnified and protected by the Company in respect of any such action, determination or interpretation.

 

4.2.                            Subject to the provisions of the Plan, the Committee shall have full and final authority in its discretion (a) to select the Employees, Consultants and Non-Employee Directors who will receive Awards pursuant to the Plan, (b) to determine the type or types of Awards to be granted to each Participant, (c) to determine the number of shares of Common Stock to which an Award will relate, the terms and conditions of any Award granted under the Plan (including, but not limited to, restrictions as to vesting, transferability or forfeiture, exercisability or settlement of an Award and waivers or accelerations thereof, and waivers of or modifications to performance conditions relating to an Award, based in each case on such considerations as the Committee shall determine) and all other matters to be determined in

 

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connection with an Award; (d) to determine whether, to what extent, and under what circumstances an Award may be canceled, forfeited, or surrendered; (e) to determine whether, and to certify that, Performance Goals to which the settlement of an Award is subject are satisfied; (f) to correct any defect or supply any omission or reconcile any inconsistency in the Plan, and to adopt, amend and rescind such rules and regulations as, in its opinion, may be advisable in the administration of the Plan; and (g) to construe and interpret the Plan and to make all other determinations as it may deem necessary or advisable for the administration of the Plan.

 

4.3.                            The Committee’s powers shall also include responsibility to determine the effect, if any, of a Change in Control of the Company upon outstanding Awards.  Upon a Change in Control, the Committee may, at its discretion, (i) fully vest any or all Awards made under the Plan, (ii) determine whether all applicable Performance Goals have been achieved and the applicable level of performance, (iii) cancel any outstanding Awards in exchange for a cash payment of an amount (including zero) equal to the difference between the then Fair Market Value of the Award less the option or base price of the Award, (iv) after having given the Participant a reasonable chance to exercise any vested outstanding Options or SARs, terminate any or all of the Participant’s unexercised Options or SARs, (v) where the Company is not the surviving corporation, cause the surviving corporation to assume all outstanding Awards or replace all outstanding Awards with comparable awards or (vi) take such other action as the Committee shall determine to be appropriate.

 

4.4.                            The Committee may impose on any Award or the exercise thereof, at the date of grant or thereafter, such terms and conditions, not inconsistent with the provisions of the Plan, as the Committee shall determine, including terms requiring forfeiture of Awards in

 

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the event of the Participant’s termination of employment or service with the Company or any Subsidiary or Affiliate; provided, however, that the Committee shall retain full power to accelerate or waive any such term or condition as it may have previously imposed, including, without limitation, any minimum vesting period.  All Awards shall be evidenced by an Award Agreement.  The right of a Participant to exercise or receive a grant or settlement of any Award, and the timing thereof, may be subject to such Performance Goals as may be specified by the Committee.

 

4.5.                            To the extent permitted by applicable law, the Committee may delegate some or all of its authority with respect to the Plan and Awards to any executive officer of the Company or any other person or persons designated by the Committee, in each case, acting individually or as a committee, provided that the Committee may not delegate its authority hereunder to make awards to Employees who are (i) “officers” as defined in Rule 16a-1(f) under the 1934 Act, (ii) “covered employees” within the meaning of Section 162(m) of the Code or (iii) officers or other Employees who are delegated authority by the Committee pursuant to this Section.  Any delegation hereunder shall be subject to the restrictions and limits that the Committee specifies at the time of such delegation or thereafter.  The Committee may at any time rescind the authority delegated to any person pursuant to this Section.  Any action undertaken by any such person or persons in accordance with the Committee’s delegation of authority pursuant to this Section shall have the same force and effect as if undertaken directly by the Committee.

 

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5.                                      Shares of Stock Subject to the Plan

 

5.1.                            Subject to adjustment as provided in Section 13, the total number of shares of Common Stock available for Awards under the Plan shall be 12,280,000.

 

5.2.                            Subject to adjustment as provided in Section 13, (i) the maximum number of shares of Common Stock available for Awards that are intended to be Incentive Stock Options shall not exceed 12,280,000 and (ii) the maximum number of shares of Common Stock available for Awards that may be granted to any individual Participant shall not exceed 1,840,000 during any calendar year.

 

5.3.                            If any shares subject to an Award are forfeited or such Award otherwise terminates, any shares counted against the number of shares available for issuance pursuant to the Plan with respect to such Award shall, to the extent of any such forfeiture or termination, again be available for Awards under the Plan; provided, however, that the Committee may adopt procedures for the counting of shares relating to any Award to ensure appropriate counting, avoid double counting, and provide for adjustments in any case in which the number of shares actually distributed differs from the number of shares previously counted in connection with such Award.  SARs or Restricted Stock Units to be settled in shares of Common Stock shall be counted in full against the number of shares available for award under the Plan, regardless of the number of shares of Common Stock issued upon settlement of the SAR or Restricted Stock Unit.  If any shares subject to an Award are retained or reacquired by the Company in payment of an exercise price or satisfaction of a withholding or other tax obligation in connection with any Award, such shares shall not be made available for future Awards under the Plan.

 

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5.4.                            Any shares issued hereunder may consist, in whole or in part, of authorized and unissued shares or treasury shares.  Any shares issued by the Company through the assumption or substitution of outstanding grants in connection with the acquisition of another entity shall not reduce the maximum number of shares available for delivery under the Plan.

 

6.                                      Common Stock

 

An Award of Common Stock is a grant by the Company of a specified number of shares of Common Stock to the Participant, which shares are not subject to forfeiture except as set forth in Section 21.  Upon the Award of Common Stock, the Committee may direct the number of shares of Common Stock subject to such Award be issued to the Participant, designating the Participant as the registered owner.  The Participant shall have all of the customary rights of a stockholder with respect to the Award of Common Stock, including the right to vote shares of the Common Stock and receive dividends with respect to the Common Stock.

 

7.                                      Deferred Stock

 

An Award of Deferred Stock is an agreement by the Company to deliver to the Participant a specified number of shares of Common Stock at the end of a specified Deferral Period or Periods.  Such an Award shall be subject to the following terms and conditions:

 

7.1.                            Upon the Award of Deferred Stock, the Committee shall direct that the number of shares subject to such Award be credited to the Participant’s account on the books of the Company but that issuance and delivery of the same shall be deferred until the date or dates provided in the Award Agreement.  Prior to issuance and delivery of the Deferred Stock,

 

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the Participant shall have no rights as a stockholder with respect to any shares of Deferred Stock credited to the Participant’s account.

 

7.2.                            During the Deferral Period, no dividend shall be paid with respect to shares covered by a Deferred Stock Award and the Participant shall have no future right to any dividend paid during the Deferral Period.

 

7.3.                            The Deferral Period may consist of one or more installments.  Provided that the Deferred Stock has not been previously forfeited, at the end of the Deferral Period or any installment thereof, the shares of Deferred Stock applicable to such installment, shall be issued and delivered to the Participant (or, where appropriate, the Participant’s legal representative) in accordance with the terms of the Award Agreement.  Subject to the Committee’s authority under Sections 4.3 and 4.4 to accelerate the vesting of Awards, the Deferral Period with respect to Deferred Stock granted to a Participant other than a Non-Employee Director shall commence on the date of grant and end no earlier than four years following the date of grant; provided that the Deferral Period may end for up to one-quarter of the shares of Deferred Stock on each anniversary of the date of grant; further provided that the Deferral Period for Deferred Stock that vests based on the achievement of specified Performance Goals shall end no earlier than one year following the date of grant.

 

8.                                      Restricted Stock

 

An Award of Restricted Stock is a grant by the Company of a specified number of shares of Common Stock to the Participant, which shares are subject to forfeiture upon the happening of specified events.  Such an Award shall be subject to the following terms and conditions:

 

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8.1.                            Upon the Award of Restricted Stock, the Committee may direct the number of shares of Common Stock subject to such Award be issued to the Participant or placed in a restricted stock account (including an electronic account) with the transfer agent and in either case designating the Participant as the registered owner.  The certificate(s), if any, representing such shares shall be physically or electronically legended, as applicable, as to sale, transfer, assignment, pledge or other encumbrances during the Restriction Period and, if issued to the Participant, returned to the Company to be held in escrow during the Restriction Period.  In all cases, the Participant shall sign a stock power endorsed in blank to the Company to be held in escrow during the Restriction Period.

 

8.2.                            During the Restriction Period, the Participant shall have the right to vote shares of Restricted Stock.  During the Restriction Period, no dividend shall be paid with respect to the number of shares covered by a Restricted Stock Award and the Participant shall have no future right to any dividend paid during the Restriction Period.

 

8.3.                            Provided that the Restricted Stock has not been previously forfeited, at the end of the Restriction Period the restrictions imposed under the Award Agreement shall lapse with respect to the number of shares specified thereunder, and the legend, if any, imposed hereunder shall be removed and such number of shares delivered to the Participant (or, where appropriate, the Participant’s legal representative).

 

8.4.       Subject to the Committee’s authority under Sections 4.3 and 4.4 to accelerate the vesting of Awards, the Restriction Period with respect to Restricted Stock granted to a Participant other than a Non-Employee Director shall commence on the date of grant and end no earlier than four years following the date of grant; provided that the Restriction Period

 

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may end for up to one-quarter of the shares of Restricted Stock on each anniversary of the date of grant; further provided that the Restriction Period for Restricted Stock that vests based on the achievement of specified Performance Goals shall end no earlier than one year following the date of grant.

 

9.                                      Restricted Stock Units

 

An Award of Restricted Stock Units is a grant by the Company of the right to receive a payment in Common Stock or in cash, or in a combination thereof, that is equal to the Fair Market Value of a share of Common Stock as of the date of vesting or payment, as set forth in the applicable Award Agreement, which right is subject to forfeiture upon the happening of specified events. Such an Award shall be subject to the following terms and conditions:

 

9.1.                            Any amount payable upon the end of the Restriction Period with respect to a Restricted Stock Unit shall be paid by the Company in shares of Common Stock, in cash or in a combination of shares of Common Stock and cash, as determined by the Committee in its sole discretion or as set forth in the Award Agreement.

 

9.2.                            Provided that the Restricted Stock Units have not been previously forfeited, at the end of the Restriction Period the restrictions imposed under the Award Agreement shall lapse with respect to the number of Restricted Stock Units specified thereunder, and shares of Common Stock or cash with a value equal to the Fair Market Value of the shares of Common Stock underlying such Restricted Stock Units shall be delivered to the Participant (or, where appropriate, the Participant’s legal representative).

 

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9.3.                            Subject to the Committee’s authority under Sections 4.3 and 4.4 to accelerate the vesting of Awards, the Restriction Period with respect to Restricted Stock Units granted to a Participant other than a Non-Employee Director shall commence on the date of grant and end no earlier than four years following the date of grant; provided that the Restriction Period may end for up to one-quarter of the Restricted Stock Units on each anniversary of the date of grant; further provided that the Restriction Period for Restricted Stock Units that vest based on the achievement of specified Performance Goals shall end no earlier than one year following the date of grant.

 

10.                               Options

 

Options give a Participant the right to purchase a specified number of shares of Common Stock from the Company for a specified time period at a fixed price.  Options may be either Incentive Stock Options or Non-Qualified Stock Options.  The grant of Options shall be subject to the following terms and conditions:

 

10.1.                     Option Price:  The price per share at which Common Stock may be purchased upon exercise of an Option shall be determined by the Committee, but shall be not less than 100% of the Fair Market Value of a share of Common Stock on the date of grant (or 110% of such Fair Market Value in the case of an Incentive Stock Option granted to a Ten Percent Shareholder), unless the Option was granted through the assumption of, or in substitution for, outstanding awards previously granted by an entity acquired by the Company or any Subsidiary or Affiliate or with which the Company or any Subsidiary or Affiliate combines.

 

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10.2.                     Term of Options:  The term of an Option shall in no event be greater than ten years (five years in the case of an Incentive Stock Option granted to a Ten Percent Shareholder).

 

10.3.                     Incentive Stock Options:  Each provision of the Plan and each Award Agreement relating to an Incentive Stock Option shall be construed so that each Incentive Stock Option shall be an incentive stock option as defined in Section 422 of the Code, and any provisions of an Award Agreement that cannot be so construed shall be disregarded.  In no event may a Participant be granted an Incentive Stock Option which does not comply with the grant and vesting limitations prescribed by Section 422(b) of the Code.  Incentive Stock Options may not be granted to Employees of Affiliates or to Consultants or Non-Employee Directors.

 

10.4.                     Payment of Option Price:  The option price of the shares of Common Stock received upon the exercise of an Option shall be paid within three days of the date of exercise: (i) in cash, or (ii) with the proceeds received from a broker-dealer whom the Participant has authorized to sell all or a portion of the Common Stock covered by the Option, or (iii) with the consent of the Committee, in whole or in part in Common Stock held by the Participant and valued at Fair Market Value on the date of exercise.  With the consent of the Committee, payment upon the exercise of a Non-Qualified Option may be made in whole or in part by Restricted Stock held by the Participant and valued at Fair Market Value on the date the Option is exercised.  In such case, the Common Stock to which the Option relates shall be subject to the same forfeiture restrictions originally imposed on the Restricted Stock exchanged therefor.  An Option may be exercised only for a whole number of shares of Common Stock.

 

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10.5.                     Minimum Vesting Period for Options:  Subject to the Committee’s authority under Sections 4.3 and 4.4 to accelerate the vesting of Awards, the minimum vesting period for an Option granted to a participant other than a Non-Employee Director shall be four years from the date of grant; provided that an Option may vest and become exercisable for up to one-quarter of the shares of Common Stock underlying the Option on the first anniversary of the date of grant and for up to 1/48 of the Shares of Common Stock underlying the Option each month thereafter; further provided that an Option that vests based on the achievement of specified Performance Goals may vest and become exercisable for the shares of Common Stock underlying the Option at any time on or after the first anniversary of the date of grant. Notwithstanding the foregoing, a Participant who is subject to Section 16 of the 1934 Act may direct the Company to withhold Shares otherwise to be delivered upon the exercise of an Award in order to pay the exercise price due on such Award.

 

11.                               Stock Appreciation Rights

 

SARs give the Participant the right to receive, upon exercise of the SAR, the excess of (i) the Fair Market Value of one share of Common Stock on the date of exercise over (ii) the grant price of the SAR as determined by the Committee, but which may never be less than 100% of the Fair Market Value of a share of Common Stock on the date of grant.  The grant of SARs shall be subject to the following terms and conditions:

 

11.1.                     The term of a SAR shall in no event be greater than ten years.

 

11.2.                     The Committee shall determine the time or times at which a SAR may be exercised in whole or in part, the method of exercise, the method of settlement, form of consideration payable in settlement, method by which Common Stock will be delivered or

 

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deemed to be delivered to Participants, whether or not a SAR shall be in tandem with any other Award, and any other terms and conditions of any SAR.

 

11.3.                     Subject to the Committee’s authority under Sections 4.3 and 4.4 to accelerate the vesting of Awards, the minimum vesting period for a SAR granted to a Participant other than a Non-Employee Director shall be four years from the date of grant; provided that a SAR may vest and become exercisable for up to one-quarter of the shares of Common Stock underlying the SAR on each anniversary of the date of grant; further provided that a SAR that vests based on the achievement of specified Performance Goals may vest and become exercisable for the shares of Common Stock underlying the SAR at any time on or after the first anniversary of the date of grant.

 

11.4.                     The Committee may provide that a SAR shall be deemed to be exercised at the close of business on the scheduled expiration date of such SAR.

 

12.                               Qualified Performance-Based Awards.

 

To the extent the Committee determines, in its sole discretion, that it is necessary or advisable in order to comply with the deductibility limitations of Section 162(m) of the Code applicable to Qualified Performance-Based Awards, the following rules shall apply:

 

12.1.                     Only an Employee who is a  “covered employee” within the meaning of Section 162(m) of the Code shall be eligible to receive Qualified Performance-Based Awards.  The Committee shall designate in its sole discretion which covered employees will be Participants for a Performance Cycle within the earlier of (i) the first 90 days of a Performance Cycle and (ii) the lapse of 25% of the Performance Cycle.

 

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12.2.                     The Committee shall establish in writing within the earlier of (i) the first 90 days of a Performance Cycle and (ii) the lapse of 25% of the Performance Cycle, and in any event, while the outcome is substantially uncertain, (A) Performance Goals for the Performance Cycle, and (B) in respect of such Performance Goals, a minimum acceptable level of achievement below which no payment will be made or no Award shall vest or become exercisable, and an objective formula or other method for determining the amount of any payment to be made or the extent to which an Award hereunder shall vest or become exercisable if performance is at or above such minimum acceptable level but falls short of the maximum achievement of the specified Performance Goals.

 

12.3.                     Following the completion of a Performance Cycle, the Committee shall review and certify in writing whether, and to what extent, the Performance Goals for the Performance Cycle have been achieved and, if so, to also calculate and certify in writing the amount of the Qualified Performance-Based Awards earned for the Performance Cycle based upon the Performance Goals and the related formulas or methods as determined pursuant to Section 12.2.  The Committee shall then determine the actual amount payable or the extent to which an Award is vested or exercisable as a result of attainment of such Performance Goals under each Participant’s Award for the Performance Cycle, and, in doing so, may reduce or eliminate, except as otherwise provided in the Award Agreement, the amount of the Award.  In no event shall the Committee have the authority to increase Award amounts to any covered employee under a Qualified Performance-Based Award.

 

12.4.                     A Qualified Performance-Based Award granted, vesting or becoming exercisable with respect to a Performance Cycle shall be paid (unless such Award is

 

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subject to the Participant’s exercise, which exercise such Participant has not effectuated) as soon as practicable following completion of the certification described in Section 12.3 but in no event later than December 31 of the year following the year in which the applicable Performance Cycle ends.

 

13.                               Adjustments upon Changes in Capitalization

 

13.1.                     In order to prevent dilution or enlargement of the rights of Participants under the Plan as a result of any stock dividend, recapitalization, forward stock split or reverse stock split, reorganization, division, merger, consolidation, spin-off, combination, repurchase or share exchange, extraordinary or unusual cash distribution or other similar corporate transaction or event that affects the Common Stock, the Committee shall adjust (i) the number and kind of shares of Common Stock which may thereafter be issued in connection with Awards, (ii) the number and kind of shares of Common Stock issuable in respect of outstanding Awards, (iii) the aggregate number and kind of shares of Common Stock available under the Plan, and (iv) the exercise or grant price relating to any Award.  Any such adjustment shall be made in an equitable manner which reflects the effect of such transaction or event.  It is provided, however, that in the case of any such transaction or event, the Committee may make any additional adjustments to the items in (i) through (iv) above which it deems appropriate in the circumstances, or make provision for a cash payment with respect to any outstanding Award; and it is provided, further, that no adjustment shall be made under this Section that would cause the Plan to violate Section 422 of the Code with respect to Incentive Stock Options or that would adversely affect the status of any Award that is “performance-based compensation” under Section 162(m) of the Code.

 

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13.2.                     In addition, the Committee is authorized to make adjustments in the terms and conditions of, and the criteria included in, Awards, including any Performance Goals, in recognition of unusual or nonrecurring events (including, without limitation, events described in Section 13.1) affecting the Company, any Subsidiary or Affiliate, or in response to changes in applicable laws, regulations, or accounting principles.  Notwithstanding the foregoing, no adjustment shall be made in any outstanding Awards to the extent that such adjustment would adversely affect the intended status of the Award as “performance-based compensation” under Section 162(m) of the Code.

 

14.                               Termination and Amendment

 

14.1.                     The Board may amend, alter, suspend, discontinue, or terminate the Plan without the consent of the Company’s stockholders or Participants, except that any such amendment, alteration, suspension, discontinuation, or termination shall be subject to the approval of the Company’s stockholders if (i) such action would increase the number of shares subject to the Plan, (ii) such action results in the repricing, replacement or repurchase of any Option, SAR  or other Award, or (iii) such stockholder approval is required by any federal or state law or regulation or the rules of any stock exchange or automated quotation system on which the Common Stock may then be listed or quoted, in each case, except as provided in Section 13.1; provided, however, that without the consent of an affected Participant, no amendment, alteration, suspension, discontinuation, or termination of the Plan may materially and adversely affect the rights of such Participant under any Award theretofore granted and any Award Agreement relating thereto, except as the Committee determines in its sole discretion to be necessary or advisable to ensure a deduction under Section 162(m) of the Code or to comply

 

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with Section 409A of the Code or an exemption therefrom.  The Committee may waive any conditions or rights under, or amend, alter, suspend, discontinue, or terminate, any Award theretofore granted and any Award Agreement relating thereto; provided, however, that without the consent of an affected Participant, no such amendment, alteration, suspension, discontinuation, or termination of any Award may materially and adversely affect the rights of such Participant under such Award, except as the Committee determines in its sole discretion to be necessary or advisable to ensure a deduction under Section 162(m) of the Code or to comply with Section 409A of the Code or an exemption therefrom.

 

14.2.                     The foregoing notwithstanding, any Performance Goal or other performance condition specified in connection with an Award shall not be deemed a fixed contractual term, but shall remain subject to adjustment by the Committee, in its discretion at any time in view of the Committee’s assessment of the Company’s strategy, performance of comparable companies, and other circumstances, except to the extent that any such adjustment to a performance condition would adversely affect the intended status of an Award as “performance-based compensation” under Section 162(m) of the Code.

 

15.                               No Right to Award, Employment or Service

 

Neither the Plan nor any action taken hereunder shall be construed as giving any Employee, Consultant or Non-Employee Director any right to be retained in the employ or service of the Company, any Subsidiary or Affiliate.  For purposes of the Plan, transfer of employment or service between the Company and its Subsidiaries and Affiliates shall not be deemed a termination of employment or service.

 

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16.                               Taxes

 

The Company, any Subsidiary or Affiliate is authorized to withhold from any payment relating to an Award under the Plan, including from a distribution of Common Stock or any payroll or other payment to a Participant amounts of withholding and other taxes due in connection with any transaction involving an Award, and to take such other action as the Committee may deem advisable to enable the Company, the Subsidiary or Affiliate and Participants to satisfy obligations for the payment of withholding taxes and other tax obligations relating to any Award.  This authority shall include authority to withhold or receive Common Stock or other property and to make cash payments in respect thereof in satisfaction of a Participant’s tax obligations.  Withholding of taxes in the form of shares of Common Stock shall not occur at a rate that exceeds the minimum required statutory federal and state withholding rates.  Participants who are subject to the reporting requirements of Section 16 of the 1934 Act may elect to pay all or a portion of any withholding or other taxes due in connection with an Award by directing the Company to withhold shares of Common Stock that would otherwise be received in connection with such Award.

 

17.                               Limits on Transferability; Beneficiaries

 

No Award or other right or interest of a Participant under the Plan shall be pledged, encumbered, or hypothecated to, or in favor of, or subject to any lien, obligation, or liability of such Participant to, any party, other than the Company, any Subsidiary or Affiliate, or assigned or transferred by such Participant otherwise than by will or the laws of descent and distribution, and such Awards and rights shall be exercisable during the lifetime of the Participant only by the Participant or his or her guardian or legal representative.

 

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Notwithstanding the foregoing, the Committee may, in its discretion, provide that Awards or other rights or interests of a Participant granted pursuant to the Plan (other than an Incentive Stock Option) be transferable, without consideration, to immediate family members (i.e., children, grandchildren or spouse), to trusts for the benefit of such immediate family members and to partnerships in which such family members are the only partners.  The Committee may attach to such transferability feature such terms and conditions as it deems advisable.  In addition, a Participant may, in the manner established by the Committee, designate a beneficiary (which may be a person or a trust) to exercise the rights of the Participant, and to receive any distribution, with respect to any Award upon the death of the Participant.  A beneficiary, guardian, legal representative or other person claiming any rights under the Plan from or through any Participant shall be subject to all terms and conditions of the Plan and any Award Agreement applicable to such Participant, except as otherwise determined by the Committee, and to any additional restrictions deemed necessary or appropriate by the Committee.

 

18.                               No Rights to Awards; No Stockholder Rights

 

No Participant shall have any claim to be granted any Award under the Plan, and there is no obligation for uniformity of treatment of Participants.  No Award shall confer on any Participant any of the rights of a stockholder of the Company unless and until Common Stock is duly issued or transferred to the Participant in accordance with the terms of the Award.

 

19.                               Foreign Nationals.

 

Without amending the Plan, Awards may be granted to Employees, Consultants and Non-Employee Directors who are foreign nationals or are employed or providing services outside the United States or both, on such terms and conditions different from those specified in

 

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the Plan as may, in the judgment of the Committee, be necessary or desirable to further the purpose of the Plan.  Moreover, the Committee may approve such supplements to, or amendments, restatements or alternative versions of, the Plan as it may consider necessary or appropriate for such purposes without thereby affecting the terms of the Plan as in effect for any other purpose, provided that no such supplements, amendments, restatements or alternative versions shall include any provisions that are inconsistent with the terms of the Plan, as then in effect, unless the Plan could have been amended to eliminate such inconsistency without further approval by the stockholders of the Company.

 

20.                               Securities Law Requirements

 

20.1.                     No Award granted hereunder shall be exercisable if the Company shall at any time determine that (a) the listing upon any securities exchange, registration or qualification under any state or federal law of any Common Stock otherwise deliverable upon such exercise, or (b) the consent or approval of any regulatory body or the satisfaction of withholding tax or other withholding liabilities, is necessary or appropriate in connection with such exercise.  In any of the events referred to in clause (a) or clause (b) above, the exercisability of such Awards shall be suspended and shall not be effective unless and until such withholding, listing, registration, qualifications or approval shall have been effected or obtained free of any conditions not acceptable to the Company in its sole discretion, notwithstanding any termination of any Award or any portion of any Award during the period when exercisability has been suspended.

 

20.2.                     The Committee may require, as a condition to the right to exercise any Award that the Company receive from the Participant, at the time any such Award is

 

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exercised, vests or any applicable restrictions lapse, representations, warranties and agreements to the effect that the shares are being purchased or acquired by the Participant for investment only and without any present intention to sell or otherwise distribute such shares and that the Participant will not dispose of such shares in transactions which, in the opinion of counsel to the Company, would violate the registration provisions of the Securities Act of 1933, as then amended, and the rules and regulations thereunder.  The certificates issued to evidence such shares shall bear appropriate legends summarizing such restrictions on the disposition thereof.

 

21.                               Recoupment

 

Any Award granted pursuant to the Plan shall be subject to mandatory repayment by the Participant to the Company pursuant to the terms of any Company “clawback” or recoupment policy directly applicable to the Plan and (i) set forth in the Participant’s Award Agreement or (ii) required by law to be applicable to the Participant.

 

22.                               Termination

 

Unless the Plan previously shall have been terminated by action of the Board, the Plan shall terminate on the 10-year anniversary of the Effective Date, and no Awards under the Plan shall thereafter be granted.

 

23.                               Fractional Shares

 

The Company will not be required to issue any fractional shares of Common Stock pursuant to the Plan.  The Committee may provide for the elimination of fractions and for the settlement of fractions in cash.

 

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24.                               Governing Law

 

To the extent that Federal laws do not otherwise control, the validity and construction of the Plan and any Award Agreement entered into thereunder shall be construed and enforced in accordance with the laws of the State of Delaware, but without giving effect to the choice of law principles thereof.

 

25.                               Effective Date

 

The Plan shall be effective as of the date approved by the Company’s shareholders.

 

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