Document:

EX-4.15

 Exhibit 4.15 

[FORMS OF REGISTERED 3.500% SENIOR NOTES DUE 2016, 2.300% SENIOR NOTES DUE 2017, 8.125% SENIOR NOTES DUE 2019, 6.875% SENIOR NOTES DUE 2020, 3.750% SENIOR
NOTES DUE 2023, 8.125% SENIOR NOTES DUE 2040 AND 7.000% SENIOR NOTES DUE 2041] 
 UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), NEW YORK, NEW YORK, TO THE COMPANY 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. 

REYNOLDS AMERICAN INC. 

[3.500% Senior Notes due 2016] 

[2.300% Senior Notes due 2017] 

[8.125% Senior Notes due 2019] 

[6.875% Senior Notes due 2020] 

[3.750% Senior Notes due 2023] 

[8.125% Senior Notes due 2040] 

[7.000% Senior Notes due 2041] 
  

			
	Certificate No.             	  	$        
	Dated:             , 2015 (the “Issue Date”)	  	CUSIP No.             

 Reynolds American Inc., a North Carolina corporation (the “Company,” which term includes any
successor corporation under the Indenture hereinafter referred to), for value received, promises to pay to Cede & Co., or its registered assigns, the principal sum of
                     ($            ) on [August 4, 2016] [August 21, 2017] [June 23,
2019] [May 1, 2020] [May 20, 2023] [May 1, 2040] [August 4, 2041]. 
  

			
	Interest Payment Dates:	  	[February 4 and August 4, commencing February 4, 2016.]
		
		  	[February 21 and August 21, commencing February 21, 2016.]
		
		  	[June 23 and December 23, commencing December 23, 2015.]
		
		  	[May 1 and November 1, commencing May 1, 2016.]
		
		  	[May 20 and November 20, commencing May 20, 2016.]
		
		  	[May 1 and November 1, commencing May 1, 2016.]
		
		  	[February 4 and August 4, commencing February 4, 2016.]

  

			
	Record Dates:	  	[January 20 and July 20.]
		
		  	[February 6 and August 6.]
		
		  	[June 8 and December 8.]
		
		  	[April 15 and October 15.]
		
		  	[May 5 and November 5.]
		
		  	[April 15 and October 15.]
		
		  	[January 20 and July 20.]

 Reference is hereby made to the further provisions of this Note set forth on the reverse hereof,
which further provisions shall have the same effect for all purposes as if set forth at this place. 
 Unless the certificate of
authentication hereof has been executed by the Trustee referred to on the reverse hereof by manual signature, this Note shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose. 

  
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 IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed under its
corporate seal. 
 Dated:             , 20     

 

			
	REYNOLDS AMERICAN INC.,
	as Issuer
		
	By:	 	  

	Name:	 	Daniel A. Fawley
	Title:	 	Senior Vice President and Treasurer
		
	By:	 	  

	Name:	 	McDara P. Folan, III
	Title:	 	Senior Vice President, Deputy General Counsel and Secretary

 Each of the undersigned hereby acknowledges its obligation as a Guarantor under the Indenture. 

 

			
	SANTA FE NATURAL TOBACCO COMPANY, INC.,
	as Guarantor
		
	By:	 	  

	Name:	 	Daniel A. Fawley
	Title:	 	Vice President and Treasurer
	
	 R. J. REYNOLDS TOBACCO COMPANY,

as Guarantor

		
	By:	 	  

	Name:	 	Daniel A. Fawley
	Title:	 	Treasurer

  

[2016][2017][2019][2020][2023][2040][2041] Note Signature Page 

			
	R. J. REYNOLDS TOBACCO CO.,
	as Guarantor
		
	By:	 	  

	Name:	 	Daniel A. Fawley
	Title:	 	Vice President and Treasurer
	
	 REYNOLDS INNOVATIONS INC.,

as Guarantor

		
	By:	 	  

	Name:	 	Daniel A. Fawley
	Title:	 	Treasurer
	
	 CONWOOD HOLDINGS, INC.,
 as
Guarantor

		
	By:	 	  

	Name:	 	Daniel A. Fawley
	Title:	 	Vice President and Treasurer
	
	 AMERICAN SNUFF COMPANY, LLC,

as Guarantor

		
	By:	 	  

	Name:	 	Daniel A. Fawley
	Title:	 	Vice President and Treasurer

  

[2016][2017][2019][2020][2023][2040][2041] Note Signature Page 

			
	ROSSWIL LLC,
	as Guarantor
		
	By:	 	  

	Name:	 	Daniel A. Fawley
	Title:	 	Vice President and Treasurer
	
	 R.J. REYNOLDS TOBACCO HOLDINGS, INC.,

as Guarantor

		
	By:	 	  

	Name:	 	Daniel A. Fawley
	Title:	 	Senior Vice President and Treasurer
	
	 R. J. REYNOLDS GLOBAL PRODUCTS, INC.,

as Guarantor

		
	By:	 	  

	Name:	 	Daniel A. Fawley
	Title:	 	Vice President and Treasurer
	
	 RAI SERVICES COMPANY,
 as
Guarantor

		
	By:	 	  

	Name:	 	Daniel A. Fawley
	Title:	 	Senior Vice President and Treasurer

  

[2016][2017][2019][2020][2023][2040][2041] Note Signature Page 

			
	REYNOLDS FINANCE COMPANY,
	as Guarantor
		
	By:	 	  

	Name:	 	Caroline M. Price
	Title:	 	President
	
	 LORILLARD LICENSING COMPANY LLC,

as Guarantor

		
	By:	 	  

	Name:	 	David A. Shirlen
	Title:	 	President

  

[2016][2017][2019][2020][2023][2040][2041] Note Signature Page 

 (Trustee’s Certificate of Authentication) 

This is one of the Notes of the series designated herein and referred to in the within-mentioned Indenture. 

Dated:             , 20     

 

			
	THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.,
	as Trustee
		
	By:	 	  

	Name:	 	
	Title:	 	

  

[2016][2017][2019][2020][2023][2040][2041] Note Signature Page 

 [REVERSE OF NOTE] 

[3.500% Senior Notes due 2016] 

[2.300% Senior Notes due 2017] 

[8.125% Senior Notes due 2019] 

[6.875% Senior Notes due 2020] 

[3.750% Senior Notes due 2023] 

[8.125% Senior Notes due 2040] 

[7.000% Senior Notes due 2041] 

References herein to the “Notes” mean the Company’s [3.500% Senior Notes due 2016] [2.300% Senior Notes due 2017] [8.125%
Senior Notes due 2019] [6.875% Senior Notes due 2020] [3.750% Senior Notes due 2023] [8.125% Senior Notes due 2040] [7.000% Senior Notes due 2041] and not to any other series. Other capitalized terms used, but not defined, herein shall have the
meanings assigned to them in the Indenture and Schedule I attached hereto unless otherwise indicated. 
 1. Interest. [(a)]
The Company promises to pay interest on the principal amount of this Note at [3.500%] [2.300%] [8.125%] [6.875%] [3.750%] [8.125%] [7.000%] per annum from the date provided below until maturity. The Company shall pay interest semi-annually, in
arrears, on [February 4 and August 4] [February 21 and August 21] [June 23 and December 23] [May 1 and November 1] [May 20 and November 20] [May 1 and November 1] [February 4 and August 4] of each year, or if any
such day is not a Business Day, on the next succeeding Business Day (each an “Interest Payment Date”), except that, if the maturity date of the Note falls on a day that is not a Business Day, the Company will make the required payment of
interest and principal on the immediately succeeding Business Day, as if it were made on the date the payment was due. This Note has been issued in exchange for a like aggregate principal amount of the Company’s [3.500% Senior Notes due 2016]
[2.300% Senior Notes due 2017] [8.125% Senior Notes due June 23, 2019] [6.875% Senior Notes due 2020] [3.750% Senior Notes due 2023] [8.125% Senior Notes due 2040] [7.000% Senior Notes due 2041], which have not been registered under the
Securities Act of 1933, as amended (the “old notes”). The old notes were issued in exchange for a like aggregate principal amount of the [3.500% Senior Notes due 2016] [2.300% Senior Notes due 2017] [8.125% Senior Notes due 2019] [6.875%
Senior Notes due 2020] [3.750% Senior Notes due 2023] [8.125% Senior Notes due 2040] [7.000% Senior Notes due 2041] issued by Lorillard Tobacco Company, a Delaware corporation (the “LTC Notes”). Interest on the Notes shall accrue from the
most recent date on which interest has been paid on the corresponding series of old notes or, if no interest has been paid on such series, from the most recent date on which interest has been paid on the corresponding series of LTC Notes; provided,
that if there is no existing Default in the payment of interest, and if this Note is authenticated between a record date referred to on the face hereof and the next succeeding Interest Payment Date, interest shall accrue from such next succeeding
Interest Payment Date. The first Interest Payment Date shall be [February 4, 2016] [February 21, 2016] [December 23, 2015] [May 1, 2016] [May 20, 2016] [May 1, 2016] [February 4, 2016]. Interest shall be computed on the basis of a 360-day year of
twelve 30-day months. Interest will not accrue as a result of any postponed or delayed payment in accordance with this paragraph. 

  
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 [IF 2019 NOTES, ADD:] 

[(b) The interest rate payable on the Notes shall be subject to adjustments from time to time if either Moody’s or S&P or, in either
case, any Substitute Rating Agency thereof downgrades (or subsequently upgrades) the debt rating assigned to the Notes, in the manner described in this Section 1. 

(c) If the rating from Moody’s (or any Substitute Rating Agency thereof) of the Notes is decreased to a rating set forth in the
immediately following table, the interest rate on the Notes shall increase such that it shall equal the interest rate payable on the Notes on their Issue Date plus the percentage set forth opposite the ratings from the table below: 

 

					
	 Moody’s Rating*
	  	Percentage Points	 
	 Ba1
	  	 	0.25	  
	 Ba2
	  	 	0.50	  
	 Ba3
	  	 	0.75	  
	 B1 or below
	  	 	1.00	  

  

	*	Including the equivalent ratings of any Substitute Rating Agency. 

 (d) If the rating from
S&P (or any Substitute Rating Agency thereof) of the Notes is decreased to a rating set forth in the immediately following table, the interest rate on the Notes shall increase such that it shall equal the interest rate payable on the Notes on
their Issue Date plus the percentage set forth opposite the ratings from the table below: 
  

					
	 S&P Rating*
	  	Percentage Points	 
	 BB+
	  	 	0.25	  
	 BB
	  	 	0.50	  
	 BB-
	  	 	0.75	  
	 B+ or below
	  	 	1.00	  

  

	*	Including the equivalent ratings of any Substitute Rating Agency. 

 (e) If at any time the
interest rate on the Notes has been adjusted upward and either Moody’s or S&P (or, in either case, a Substitute Rating Agency thereof), as the case may be, subsequently increases its rating of the Notes to any of the threshold ratings set
forth above, the interest rate on the Notes shall be decreased such that the interest rate for the Notes equals the interest rate payable on the Notes on their Issue Date plus the percentages set forth opposite the ratings from the tables above in
effect immediately following the increase. If Moody’s (or any Substitute Rating Agency thereof) subsequently increases its rating of the Notes to Baa3 (or its equivalent, in the case of a Substitute Rating Agency) or higher, and S&P (or any
Substitute Rating Agency thereof) increases its rating to BBB- (or its equivalent, in the case of a Substitute Rating Agency) or higher the interest rate on the Notes shall be decreased to the interest rate payable on the Notes on their Issue Date.
In addition, the interest rates on the Notes shall permanently cease to be subject to any adjustment described in subsections (c) and (d) above (notwithstanding any subsequent decrease in the ratings by either or both Rating Agencies) if
the Notes become rated A3 and A- (or the equivalent of either such rating, in the case of a Substitute Rating Agency) or higher by Moody’s and S&P (or, in either case, a Substitute Rating Agency thereof), respectively (or one of these
ratings if the Notes are only rated by one Rating Agency). 

  
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 (f) Each adjustment required by any decrease or increase in a rating set forth above, whether
occasioned by the action of Moody’s or S&P (or, in either case, a Substitute Rating Agency thereof), shall be made independent of any and all other adjustments. In no event shall (1) the interest rate for the Notes be reduced to below
the interest rate payable on their Issue Date or (2) the total increase in the interest rate on the Notes exceed 2.00% above the interest rate payable on the Notes on their Issue Date. 

(g) No adjustments in the interest rate of the Notes shall be made solely as a result of a Rating Agency ceasing to provide a rating of the
Notes. If at any time fewer than two Rating Agencies provide a rating of the Notes for a reason beyond the Company’s control, the Company shall use its commercially reasonable efforts to obtain a rating of the Notes from a Substitute Rating
Agency, to the extent one exists, and if a Substitute Rating Agency exists, for purposes of determining any increase or decrease in the interest rate on the Notes pursuant to the tables in subsections (c) and (d) above (1) such
Substitute Rating Agency shall be substituted for the last Rating Agency to provide a rating of the Notes but which has since ceased to provide such rating, (2) the relative rating scale used by such Substitute Rating Agency to assign ratings
to senior unsecured debt shall be determined in good faith by an independent investment banking institution of national standing appointed by the Company and, for purposes of determining the applicable ratings included in the applicable table in
subsection (c) or (d) above with respect to such Substitute Rating Agency, such ratings shall be deemed to be the equivalent ratings used by Moody’s or S&P, as applicable, in such table and (3) the interest rate on the Notes
shall increase or decrease, as the case may be, such that the interest rate equals the interest rate payable on the Notes on their Issue Date plus the appropriate percentage, if any, set forth opposite the rating from such Substitute Rating Agency
in the applicable table in subsection (c) or (d) above (taking into account the provisions of clause (2) of this subsection) (plus any applicable percentage resulting from a decreased rating by the other Rating Agency). For so long as
only one Rating Agency provides a rating of the Notes, any subsequent increase or decrease in the interest rate of the Notes necessitated by a reduction or increase in the rating by the Rating Agency providing the rating shall be twice the
percentage set forth in the applicable table in subsection (c) or (d) above. For so long as none of Moody’s, S&P or a Substitute Rating Agency provides a rating of the Notes for reasons within the Company’s control, the
interest rate on the Notes shall increase to, or remain at, as the case may be, 2.00% above the interest rate payable on the Notes on their Issue Date. 

(h) Any interest rate increase or decrease described above shall take effect from the first day of the interest period during which a rating
change requires an adjustment in the interest rate. If Moody’s or S&P (or, in either case, a Substitute Rating Agency thereof) changes its rating of the Notes more than once during any particular interest period, the last change by such
agency shall control for purposes of any interest rate increase or decrease with respect to the Notes described above relating to such rating agency’s action. 

(i) Promptly after any change in the interest rate payable on the Notes as provided in this Section 1, the Company shall provide the
Trustee an Officers’ Certificate to the effect that the interest rate payable on the Notes has changed in accordance with this provision and setting forth the amount of the related increase or decrease and the new interest rate payable on the
Notes and setting forth the 

  
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effective date of any change in the interest rate payable on the Notes and shall provide notice of the same to Holders. The Trustee shall not be responsible for monitoring the ratings of the
Notes to determine whether there has been any increase or decrease in such rating or for calculating the new interest rate payable on the Notes in the event of any increase or decrease in the ratings of the Notes. 

(j) If the interest rate payable on the Notes is increased as described above, the term “interest,” as used with respect to the
Notes, shall be deemed to include any such increased interest unless the context otherwise requires.] 
 2. Method of Payment. The
Company shall pay interest on the Notes (except defaulted interest) to the Persons who are registered Holders of Notes at the close of business on the [January 20 and July 20] [February 6 and August 6] [June 8 and December 8] [April
15 and October 15] [May 5 and November 5] [April 15 and October 15] [January 20 and July 20] (whether or not a Business Day) immediately preceding the Interest Payment Date (except that interest payable at maturity of the Notes
shall be paid to the same persons to whom principal of such Notes is payable), except as provided in Section 2.13 of the Indenture with respect to defaulted interest. The Notes shall be payable as to principal, premium, if any, and interest, at
the office or agency of the Company maintained for such purpose within the Borough of Manhattan of the City of New York, or, at the option of the Company, payment of interest may be made by check mailed to the Holders at their addresses set forth in
the register of Holders, and provided that payment by wire transfer of immediately available funds shall be required with respect to principal of and, premium, if any, and interest on, all Global Notes and all other Notes the Holders of which shall
have provided wire transfer instructions to the Company or the Paying Agent. Such payment shall be in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts. 

3. Paying Agent and Registrar. Initially, The Bank of New York Mellon Trust Company, N.A. (formerly known as The Bank of New York Trust
Company, N.A.), the Trustee under the Indenture, shall act as Paying Agent and Registrar. The Company may change any Paying Agent or Registrar without notice to any Holder. The Company or any of its Subsidiaries may act in any such capacity. 

4. Indenture. The Company issued the Notes under an Indenture dated as of May 31, 2006, as amended and supplemented, among the
Company, as issuer, certain direct and indirect subsidiaries of the Company, as guarantors, and The Bank of New York Mellon Trust Company, N.A., as trustee (the “Indenture”). The terms of the Notes include those stated in the
Indenture, those made part of the Indenture by reference to the Trust Indenture Act of 1939, as amended (the “TIA”), and those set forth in Schedule I attached hereto. The Notes are subject to all such terms, and Holders are
referred to the Indenture, the TIA and Schedule I for a statement of such terms. 
 5. Redemption at the Company’s
Option. [IF 2023 NOTES ADD: Prior to February 20, 2023, t][T]he Company may redeem all or a part of the Notes from time to time in accordance with Article 5 of the Indenture at a redemption price equal to the greater of: 

(a) 100% of the principal amount of such Notes being redeemed, and 

(b) the sum of the present values of the remaining scheduled payments of principal and interest on such Notes being redeemed discounted to the
date of redemption on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at a yield equal to (1) the applicable Treasury Rate, plus (2) 10 basis points, 

  
 4 

 plus, in each of case (a) and (b), accrued and unpaid interest on the principal amount being
redeemed to the date of redemption. 
 [IF 2023 NOTES ADD: On or after February 20, 2023, the Company may redeem all or a part of the Notes from time
to time in accordance with Article 5 of the Indenture at a redemption price equal to 100% of the principal amount of the Notes being redeemed, plus accrued and unpaid interest on the principal amount being redeemed to the date of redemption.] 

Notice of such optional redemption shall be mailed, by first class mail, at least 30 days but not more than 60 days before the redemption date to each Holder
whose Notes are to be redeemed at its registered address. Notes in denominations equal to or larger than $2,000 may be redeemed in part but only in whole multiples of $1,000, unless all of the Notes held by a Holder are to be redeemed. On and after
the redemption date, interest ceases to accrue on Notes or portions thereof called for redemption (unless the Company shall default in the payment of the redemption price and accrued interest). All redemptions shall be effected pursuant to
applicable depositary procedures. 
 6. Repurchase upon Change of Control Repurchase Event. If a Change of Control Repurchase Event
occurs with respect to the Notes, unless the Company has exercised its right to redeem the Notes, the Company will make an offer to each Holder of Notes to repurchase all or any part (in excess of $2,000 and in integral multiples of $1,000) of that
Holder’s Notes at a repurchase price in cash equal to 101% of the aggregate principal amount of Notes repurchased plus any accrued and unpaid interest on the Notes repurchased to the date of repurchase. Within 30 days following any Change of
Control Repurchase Event, the Company will mail a notice to each Holder, with a copy to the Trustee, describing the transaction or transactions that constitute the Change of Control Repurchase Event and offering to repurchase Notes on the payment
date specified in the notice, which date will be no earlier than 30 days and no later than 60 days from the date such notice is mailed. The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws
and regulations thereunder, to the extent those laws and regulations are applicable in connection with the repurchase of the Notes as a result of a Change of Control Repurchase Event. To the extent that the provisions of any securities laws or
regulations conflict with the Change of Control Repurchase Event provisions of the Notes, the Company will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations hereunder by virtue of such
conflict. On the Change of Control Repurchase Event payment date, the Company will, to the extent lawful (i) accept for payment all Notes or portions of Notes (in excess of $2,000 and in integral multiples of $1,000) properly tendered pursuant
to the Company’s offer; (ii) deposit with the Paying Agent an amount equal to the aggregate repurchase price in respect of all Notes or portions of Notes properly tendered; and (iii) deliver or cause to be delivered to the Trustee the
Notes properly accepted, together with an Officers’ Certificate stating the aggregate principal amount of Notes being purchased by the Company. The Paying Agent will promptly mail to each Holder of Notes properly tendered the repurchase price
for the Notes, and the Trustee will promptly authenticate and mail (or cause to be transferred by book-entry) to each Holder a new Note equal in principal amount to any unpurchased 

  
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portion of any Notes surrendered; provided that each new Note will be in a principal amount of $2,000 or an integral multiple of $1,000. The Company will not be required to make an offer to
repurchase the notes upon a Change of Control Repurchase Event if a third party makes such an offer in the manner, at the times and otherwise in compliance with the requirements for an offer made by the Company, and such third party purchases all
Notes properly tendered and not withdrawn under its offer. 
 7. No Sinking Fund. The Company shall not be required to make sinking
fund payments with respect to the Notes. 
 8. Denominations, Transfer, Exchange. The Notes are in registered form without coupons in
minimum denominations of $2,000 and integral multiples of $1,000. The transfer of Notes may be registered and Notes may be exchanged as provided in the Indenture. The Registrar and the Trustee may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and the Company may require a Holder to pay any taxes and fees required by law or permitted by the Indenture, including any transfer tax or other similar governmental charge payable in connection
therewith. The Company need not exchange or register the transfer of any Note or portion of a Note selected for redemption, except for the unredeemed portion of any Note being redeemed in part. Also, the Company need not exchange or register the
transfer of any Note for a period of 15 days before a selection of Notes to be redeemed. 
 9. Persons Deemed Owners. The registered
Holder of a Note may be treated as its owner for all purposes. 
 10. Amendment, Supplement and Waiver. Subject to certain
exceptions, the Indenture or the Notes may be amended or supplemented by the Company and Guarantors, each when authorized by a Board Resolution, with the consent of the Holders of at least a majority in aggregate principal amount of the Securities
at the time outstanding of all series affected by such amendment or supplement, voting as a single class, and any existing Default or compliance with any provision of the Indenture or the Notes may be waived with the consent of the Holders of a
majority in aggregate principal amount of the Securities at the time outstanding of all series affected by such Default or waiver of compliance, voting as a single class. Without the consent of any Holder of a Note, the Company and the Guarantors,
when authorized by a Board Resolution, and the Trustee may supplement the Indenture or the Notes: (a) to convey, transfer, assign, mortgage or pledge to the Trustee as security for the Notes any property or assets; (b) to evidence the
succession of another corporation to the Company, or successive successions, and the assumption by the successor corporation of the covenants, agreements and obligations of the Company; (c) to add to the covenants of the Company such further
covenants, restrictions, conditions or provisions as its Board of Directors and the Trustee shall consider to be for the protection or benefit of the Holders of the Notes, and to make the occurrence, or the occurrence and continuance, of a Default
in any such additional covenants, restrictions, conditions or provisions an Event of Default permitting the enforcement of all or any of the several remedies provided in the Indenture as therein set forth; provided, that in respect of any such
additional covenant, restriction, condition or provision such amendment or supplement may provide for a particular period of grace after Default (which period may be shorter or longer than that allowed in the case of other Defaults) or may provide
for an immediate enforcement upon such an Event of Default or may limit the remedies available to the Trustee upon such an Event of Default or may 

  
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limit the right of the Holders of a majority in aggregate principal amount of the Notes to waive such an Event of Default; (d) to cure any ambiguity or to correct or supplement any provision
contained in the Indenture or in any indenture supplemental thereto which may be defective or inconsistent with any other provision contained in the Indenture or in any indenture supplemental thereto; (e) to make such other provisions in regard
to matters or questions arising under the Indenture or under any indenture supplemental thereto as the Board of Directors may deem necessary or desirable and which shall not adversely affect the interests of the Holders of the Notes in any material
respect; (f) to establish the form or forms or terms of Securities of any series as permitted by the Indenture; (g) to evidence and provide for the acceptance of appointment under the Indenture by a successor trustee with respect to the
Notes and to add to or change any of the provisions of the Indenture as shall be necessary to provide for or facilitate the administration of the trusts thereunder by more than one trustee; (h) to provide for uncertificated Securities and to
make all appropriate changes for such purpose; (i) to comply with the requirements of the TIA; and (j) to add additional Guarantors with respect to the Notes. 

The Trustee is hereby authorized to join with the Company and the Guarantors in the execution of any such supplemental indenture, to make any
further appropriate agreements and stipulations which may be therein contained and to accept the conveyance, transfer, assignment, mortgage or pledge of any property thereunder, but the Trustee shall not be obligated to enter into any such
supplemental indenture which affects the Trustee’s own rights, duties or immunities under this Indenture or otherwise. 
 11.
Defaults and Remedies. Any of the following events which shall have occurred and be continuing (whatever the reason for such Event of Default and whether it shall be voluntary or involuntary or be effected by operation of law or pursuant to
any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body) constitutes an “Event of Default” under the Indenture: (a) default in the payment of any installment of interest
upon Securities of any series as and when the same shall become due and payable, and continuance of such default for a period of 30 days; or (b) default in the payment of all or any part of the principal on Securities of any series as and when
the same shall become due and payable either at maturity, upon any redemption, by declaration or otherwise; or (c) default in the payment of any sinking fund installment as and when the same shall become due and payable by the terms of
Securities of any series; or (d) default in the performance, or breach, of any covenant or agreement of the Company or the Guarantors in respect of Securities of any series (other than a covenant or agreement in respect of such Securities a
default in whose performance or whose breach is elsewhere in this Section specifically dealt with), and continuance of such default or breach for a period of 90 days after there has been given, by first class mail, to the Company by the Trustee or
to the Company and the Trustee by the Holders of at least 25% in principal amount of the outstanding Securities of all series affected thereby, a written notice specifying such default or breach and requiring it to be remedied and stating that such
notice is a “Notice of Default” hereunder; or (e) a court having jurisdiction in the premises shall enter a decree or order for relief in respect of the Company or the Guarantors in an involuntary case under any

  
 7 

 
applicable bankruptcy, insolvency or other similar law now or hereafter in effect, or appointing a receiver, liquidator, assignee, custodian, trustee or sequestrator (or similar official) of the
Company or for any substantial part of its property or ordering the winding up or liquidation of its affairs, and such decree or order shall remain unstayed and in effect for a period of 60 consecutive days; or (f) the Company or any Restricted
Subsidiary shall commence a voluntary case under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect, or consent to the entry of an order for relief in an involuntary case under any such law, or consent to the
appointment of or taking possession by a receiver, liquidator, assignee, custodian, trustee or sequestrator (or similar official) of the Company or for any substantial part of its property, or make any general assignment for the benefit of
creditors; or (g) any Guarantee ceases to be in full force and effect (except as contemplated by the terms of the Indenture), or any Guarantee is declared in a judicial proceeding to be null and void, or any Guarantor denies or disaffirms in
writing its obligations under the terms of the Indenture or its Guarantee; or (h) at any time as such security is required by the terms of the Indenture, any Security Document shall cease to be in full force and effect or shall cease to give
the Collateral Agent the liens or any of the material rights, powers and privileges purported to be created thereby in favor of the Collateral Agent and such default shall continue unremedied for a period of at least 30 days after written notice to
the Company by the Collateral Agent; or (i) any other Event of Default provided in Schedule I or in this Note. 
 If an Event of
Default described in clauses (a), (b), (c), (d) or (i) above (if the Event of Default under clause (d) or (i) is with respect to less than all series of Securities then outstanding) occurs and is continuing, then, and in each and
every such case, except for any series of Securities the principal of which shall have already become due and payable, either the Trustee or the Holders of not less than 25% in aggregate principal amount of the Securities of each such affected
series then outstanding under the Indenture (voting as a single class) by notice in writing to the Company (and to the Trustee if given by Securityholders), may declare the entire principal of all Securities of all such affected series, and the
interest accrued thereon, if any, to be due and payable immediately, and upon any such declaration the same shall become immediately due and payable. If an Event of Default described in clause (d) or (i) (if the Event of Default under
clauses (d) or (i), as the case may be, is with respect to all series of Securities then outstanding), (e), (f), (g) or (h) occurs and is continuing, then and in each and every such case, unless the principal of all the Securities
shall have already become due and payable, either the Trustee or the Holders of not less than 25% in aggregate principal amount of all the Securities then outstanding under the Indenture (treated as one class), by notice in writing to the Company
(and to the Trustee if given by Securityholders), may declare the entire principal of all the Securities then outstanding and interest accrued thereon, if any, to be due and payable immediately, and upon any such declaration the same shall become
immediately due and payable. 
 The foregoing provisions, however, are subject to the condition that if, at any time after the principal of
the Securities of any series (or of all the Securities, as the case may be) shall have been so declared due and payable, and before any judgment or decree for the payment of the moneys due shall have been obtained or entered as hereinafter provided,
the Company or any Guarantor shall pay or shall deposit with the Trustee a sum sufficient to pay all matured installments of interest upon all the Securities of each such series (or of all the Securities, as the case may be) and the principal of any
and all Securities of each such series (or of all the Securities, as the case may be) which shall have become due otherwise than by acceleration (with interest upon such principal and, to the extent that payment of such interest is enforceable under
applicable law, on overdue installments of interest, at the same rate as the rate of interest specified in the Securities of each such series to the date of such payment or deposit) and such amount as shall be sufficient to cover reasonable
compensation to the Trustee and each predecessor Trustee, their respective agents, attorneys and counsel, and all other expenses and liabilities incurred, and all advances made, by the 

  
 8 

 
Trustee and each predecessor Trustee except as a result of gross negligence or willful misconduct, and if any and all Events of Default under the Indenture, other than the non-payment of the
principal of Securities which shall have become due by acceleration, shall have been cured, waived or otherwise remedied as provided herein, then and in every such case the Holders of a majority in aggregate principal amount of all the Securities of
each such series, or of all the Securities, in each case voting as a single class, then outstanding, by written notice to the Company and to the Trustee, may waive all defaults with respect to each such series (or with respect to all the Securities,
as the case may be) and rescind and annul such declaration and its consequences, but no such waiver or rescission and annulment shall extend to or shall affect any subsequent default or shall impair any right consequent thereon. 

12. Trustee Dealings with Company. The Trustee, in its individual or any other capacity, may become the owner or pledgee of Securities,
and may otherwise deal with the Company, as if it were not the Trustee. 
 13. No Recourse Against Others. No director, officer,
employee, incorporator or shareholder or controlling person of the Company or the Trustee, as such, shall have any liability for any obligations of the Company or the Trustee, respectively, under the Notes or the Indenture or for any claim based on,
in respect of, or by reason of, such obligations or their creation. Each Holder of Notes by accepting a Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Notes. Such waiver may not
be effective to waive liabilities under the federal securities laws and it is the view of the Securities and Exchange Commission that such a waiver is against public policy. 

14. Authentication. This Note shall not be valid until authenticated by the manual signature of the Trustee or an authenticating agent
and in accordance with the Indenture. 
 15. Guarantees. This Note will be entitled to the benefits of certain Guarantees made for
the benefit of the Holders. Subject to the terms of the Indenture, each Guarantor of the Indenture fully, unconditionally and irrevocably guarantees, as primary obligor and not merely as surety, jointly and severally, to each Holder of the Notes and
the Trustee the full and punctual payment when due, whether at maturity, by acceleration, by redemption, by repurchase, or otherwise, of the principal of, premium, if any, and interest on the Notes and all other obligations of the Company under the
Indenture, as provided in the Indenture. Reference is made to the Indenture for a statement of the respective rights, limitations of rights, duties and obligations thereunder of the Guarantors, the Trustee and the Holders, and of the circumstances
under which the Guarantees may be released. 
 16. Abbreviations. Customary abbreviations may be used in the name of a Holder or an
assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (=Uniform Gifts to Minors Act). 

17. CUSIP Numbers. Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures, the Company
has caused CUSIP numbers to be printed on the Notes and the Trustee may use CUSIP numbers or both numbers in notices to the Holders of the Notes as a convenience to Holders. No representation is made as to the accuracy of such numbers either as
printed on the Notes or as contained in any notice to the Holders of the Notes and reliance may be placed only on the other identification numbers placed thereon. 

  
 9 

 18. Governing Law. This Note shall be governed by and construed in accordance with the
laws of the State of New York without regard to principles of conflicts of laws. 

  
 10 

 The Company shall furnish to any Holder upon written request and without charge a copy of the
Indenture. Requests may be made to: 
 Reynolds American Inc. 

401 North Main Street 

Winston-Salem, North Carolina 27101 

Facsimile: 336-741-5000 

Attention: Treasurer 

  
 11 

 SCHEDULE I 

REYNOLDS AMERICAN INC. 
 TERMS OF
3.500% SENIOR NOTES DUE 2016 
 2.300% SENIOR NOTES DUE 2017 

8.125% SENIOR NOTES DUE 2019 

6.875% SENIOR NOTES DUE 2020 

3.750% SENIOR NOTES DUE 2023 

8.125% SENIOR NOTES DUE 2040 

7.000% SENIOR NOTES DUE 2041 
 Section 1.01
Designation of Notes. (a) The terms set forth in this Schedule I pertain to notes to be issued pursuant to that certain Indenture dated May 31, 2006, as amended and supplemented, by and among Reynolds American Inc. (the
“Company”) as Issuer, The Bank of New York Mellon Trust Company, N.A. (formerly known as The Bank of New York Trust Company, N.A.), as Trustee, and certain Subsidiaries of the Company who have executed such Indenture or a supplement
thereto as Guarantors (as so supplemented, the “Indenture”). The notes subject to these terms are (i) the Company’s 3.500% Senior Notes due 2016 in the original principal amount of
$        (CUSIP Number             ) (the “2016 Notes”), (ii) the Company’s 2.300% Senior Notes due 2017 in the original
principal amount of $        (CUSIP Number             ) (the “2017 Notes”), (iii) the Company’s 8.125% Senior Notes due
2019 in the original principal amount of $        (CUSIP Number             ) (the “2019 Notes”), (iv) the Company’s
6.875% Senior Notes due 2020 in the original principal amount of $        (CUSIP Number             ) (the “2020 Notes”),
(v) the Company’s 3.750% Senior Notes due 2023 in the original principal amount of $        (CUSIP Number             ) (the “2023
Notes”), (vi) the Company’s 8.125% Senior Notes due 2040 in the original principal amount of $        (CUSIP Number             )
(the “2040 Notes”) and (vii) the Company’s 7.000% Senior Notes due 2041 in the original principal amount of $        (CUSIP Number
            ) (the “2041 Notes,” and collectively with the 2016 Notes, 2017 Notes, 2019 Notes, the 2020 Notes, the 2023 Notes and the 2040 Notes, the
“Notes”). 
 (b) The 2016 Notes, 2017 Notes, 2019 Notes, the 2020 Notes, the 2023 Notes, the 2040 Notes and the 2041 Notes
shall each be considered a separate series for all purposes of the Indenture. 
 Section 1.02 Initial Issuance.
(a) The Notes are being issued in exchange for a like aggregate principal amount of the Company’s 3.500% Senior Notes due 2016, 2.300% Senior Notes due 2017, 8.125% Senior Notes due June 23, 2019, 6.875% Senior Notes due 2020,
3.750% Senior Notes due 2023, 8.125% Senior Notes due 2040 and 7.000% Senior Notes due 2041. Each series of Notes shall be issued in the form of a permanent global note, with each such global note to be deposited with the Trustee, as Custodian for
the Depository, duly executed by the Company, and authenticated by the Trustee as hereinafter provided. Each such global note may be represented by more than one certificate, if so required by the Depository’s rules regarding the maximum
principal amount to be represented by a single certificate. The global notes representing the Notes are sometimes collectively herein referred to as the “Global Notes.” The Notes may have notations, legends or endorsements required
by law, stock exchange rule or usage. The Company and the Trustee shall approve the forms of the Notes and any notation, endorsement or legend on them.  

(b) Denominations. The Notes shall be issuable only in fully registered form, without interest coupons, and only in denominations of
$2,000 and any integral multiples of $1,000 in excess thereof. 

  
 I-1 

 Section 1.03. Depository; Custodian. The Company initially appoints The
Depository Trust Company (“DTC”) to act as Depository with respect to the Global Notes. The Company initially appoints the Trustee to act as Custodian with respect to the Global Notes. 

Section 1.04. Transfer and Exchange of Global Notes. Transfers of a Global Note shall be limited to transfers in whole, but
not in part, to the Depository, to a nominee of the Depository or to a successor Depository or such successor Depository’s nominee. 

Section 1.05 Definitions. (a) Capitalized terms not defined in this Schedule I shall have the meanings set
forth in the Indenture.  
 (b) As used herein and in the Notes, the following terms shall have the meanings set forth below: 

“Below Investment Grade Rating Event” means, with respect to each series of Notes, the Notes of that series are downgraded by
each of the Rating Agencies on any date from the date of the public notice of an arrangement that could result in a Change of Control until the end of the 60-day period following public notice of the occurrence of a Change of Control (which period
shall be extended so long as the rating of the Notes is under publicly announced consideration for possible downgrade by any of the Rating Agencies) from a rating that is Investment Grade to a rating that is below Investment Grade. 

“Change of Control” means the occurrence of any of the following: 

(1) the direct or indirect sale, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or a series
of related transactions, of all or substantially all of the properties or assets of the Company and its subsidiaries taken as a whole to any person other than the Company or one of its wholly owned subsidiaries; 

(2) the consummation of any transaction (including, without limitation, any merger or consolidation) the result of which is that any person
other than the Company or one of its wholly owned subsidiaries becomes the beneficial owner, directly or indirectly, of more than 50% of the then outstanding number of shares of Voting Stock of the Company or other Voting Stock into which the
Company’s Voting Stock is reclassified, consolidated, exchanged or changed, measured by voting power rather than number of shares; 

(3) the consolidation of the Company with, or merger of the Company with or into, any person, or the consolidation of any person with, or
merger with or into, the Company, in any such event pursuant to a transaction in which any of the Company’s outstanding Voting Stock or the Voting Stock of such other person is converted into or exchanged for cash, securities or other property,
other than any such transaction where the shares of the Company’s Voting Stock outstanding immediately prior to such transaction constitute, or are converted into or exchanged for, a majority of the Voting Stock of the surviving person or any
direct or indirect parent company of the surviving person immediately after giving effect to such transaction; and 
 (4) the adoption of a
plan relating to the Company’s liquidation or dissolution (other than its liquidation into a holding company newly formed in accordance with the following paragraph, provided that all claims and obligations of the Company are assumed by, and
all assets are transferred to such holding company). 

  
 I-2 

 Notwithstanding the foregoing, a transaction will not be deemed to involve a change of control
under clause (2) above if (1) the Company becomes a direct or indirect wholly owned subsidiary of a holding company and (2) (a) the direct or indirect holders of the Voting Stock of such holding company immediately following that
transaction are substantially the same as the holders of the Company’s Voting Stock immediately prior to that transaction or (b) immediately following that transaction no person (other than a holding company satisfying the requirements of
this sentence) is the beneficial owner, directly or indirectly, of more than 50% of the Voting Stock of such holding company. As used in this paragraph and the definition of “Change of Control,” the term “person” has the meaning
given thereto in Section 13(d)(3) of the Exchange Act and the term “beneficial owner” has the meaning given thereto in Rules 13d-3 and 13d-5 promulgated under the Exchange Act. 

“Change of Control Repurchase Event” means the occurrence of both a Change of Control and a Below Investment Grade Rating
Event. 
 “Comparable Treasury Issue” means the U.S. Treasury security selected by an Independent Investment Banker as
having a maturity comparable to the remaining term (“Remaining Life”) of the Notes to be redeemed that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt
securities of comparable maturity to the remaining term of such Notes. 
 “Comparable Treasury Price” means: (1) the
average of five Reference Treasury Dealer Quotations for such redemption date, after excluding the highest and lowest Reference Treasury Dealer Quotations; or (2) if the Independent Investment Banker obtains fewer than five such Reference
Treasury Dealer Quotations, the average of all such quotations. 
 “Custodian” means the Trustee, as custodian with respect
to the Global Notes, or any successor entity thereto. 
 “Depository” means, with respect to the Notes issued in the form
of one or more Global Notes, DTC as the Person appointed hereby as the Depository with respect to the Notes, or another Person appointed as Depository by the Company, which Person must be a clearing agency registered under the Exchange Act, and any
and all successors thereto appointed as Depository hereunder and having become such pursuant to the applicable provision of the Indenture. 

“Exchange Act” means the Securities Exchange Act of 1934, as amended. 

“Independent Investment Banker” means any of Citigroup Global Markets Inc. or J.P. Morgan Securities LLC, or, if both such
firms are unwilling or unable to select the Comparable Treasury Issue, an independent investment banking institution of national standing appointed by the Company. 

  
 I-3 

 “Investment Grade” means a rating of Baa3 or better by Moody’s (or its
equivalent under any successor rating categories of Moody’s); a rating of BBB- or better by S&P (or its equivalent under any successor rating categories of S&P); or the equivalent investment grade credit rating from any additional
Rating Agency or Rating Agencies selected by the Company pursuant to clause (2) of the definition of Rating Agency. 

“Moody’s” means Moody’s Investors Service, Inc., and any successor to its credit ratings business. 

“Person” means any individual, corporation, partnership, limited liability company, joint venture, association, joint-stock
company, trust, unincorporated organization or government or any agency or political subdivision thereof. 
 “Rating
Agency” means (1) each of Moody’s and S&P; and (2) if either of Moody’s or S&P ceases to rate the Notes or fails to make a rating of the Notes publicly available for reasons outside of the control of the Company,
a “nationally recognized statistical rating organization” within the meaning of Rule 15c3-1(c)(2)(vi)(F) under the Exchange Act, selected by us as a replacement agency for Moody’s or S&P, as the case may be. 

“Reference Treasury Dealer” means: (1) Citigroup Global Markets Inc. or J.P. Morgan Securities LLC, and their respective
successors; provided, however, that if any of the foregoing shall cease to be a primary U.S. Government securities dealer in New York City (a “Primary Treasury Dealer”), the Company will substitute for such firm another Primary Treasury
Dealer; and (2) any other Primary Treasury Dealer selected by the Independent Investment Banker after consultation with the Company. 

“Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer and any redemption date, the
average, as determined by the Independent Investment Banker, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) quoted in writing to the Independent Investment Banker at
5:00 p.m., New York City time, on the third business day preceding such redemption date. 
 “S&P” means
Standard & Poor’s Ratings Services, a division of Standard & Poor’s Financial Services LLC, a subsidiary of McGraw-Hill Financial, Inc., and any successor to its credit ratings business. 

[IF 2019 NOTES, ADD:] 
 [”Substitute
Rating Agency” means a “nationally recognized statistical rating organization” registered under Section 15E of the Exchange Act for the classes of credit ratings described in clauses (i) through (v) of
Section 3(a)(62)(B) of the Exchange Act selected by the Company (as certified by its Chief Executive Officer, Chief Financial Officer or Treasurer) as a replacement agency for Moody’s or S&P, or both of them, as the case may be.] 

“Securities Act” means the Securities Act of 1933, as amended. 

“Treasury Rate” means, with respect to any redemption date: (1) the yield, under the heading which represents the
average for the immediate preceding week, appearing in the most 

  
 I-4 

 
recently published statistical release designated “H.15(519)” or any successor publication that is published weekly by the Board of Governors of the Federal Reserve System and that
establishes yields on actively traded U.S. Treasury securities adjusted to constant maturity under the caption “Treasury Constant Maturities,” for the maturity corresponding to the Comparable Treasury Issue (if no maturity is within three
months before or after the Remaining Life, yields for the two published maturities most closely corresponding to the Comparable Treasury Issue will be determined and the Treasury Rate will be interpolated or extrapolated from such yields on a
straight line basis, rounding to the nearest month); or (2) if such release (or any successor release) is not published during the week preceding the calculation date or does not contain such yields, the rate per annum equal to the semi-annual
equivalent yield to maturity of the Comparable Treasury Issue, calculated using a price for the Comparable Treasury Price for such redemption date. The Treasury Rate will be calculated on the third business day preceding the redemption date. 

“Voting Stock” means, with respect to any specified “person” (as that term is used in Section 13(d)(3) of the
Exchange Act) as of any date, the capital stock of such person that is at the time entitled to vote generally in the election of the board of directors of such person. 

  
 I-5Exhibit 4.1

 

WARRANT

 

NEITHER THE ISSUANCE AND SALE OF THE
SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE HAVE BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE,
SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL SELECTED BY THE HOLDER, IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION
IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING,
THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE
SECURITIES.

 

xg
technology, inc.

 

Warrant
To Purchase Shares of Common Stock

 

Warrant No.: 1

Number of Shares of Common Stock: [________]

Date of Issuance: November 2, 2015 ("Issuance
Date")

 

xG Technology, Inc.,
a company organized under the laws of the State of Delaware (the "Company"), hereby certifies that, for good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, [________],
the registered holder hereof or its permitted assigns (the "Holder"), is entitled, subject to the terms set forth
below, to purchase from the Company, at the Exercise Price (as defined below) then in effect, at any time or times on or after
the Issuance Date, but not after 11:59 p.m., New York time, on the Expiration Date, (as defined below), [________] fully paid nonassessable
Shares of Common Stock, subject to adjustment as provided herein (the "Warrant Shares"). Except as otherwise
defined herein, capitalized terms in this Warrant to Purchase Shares of Common Stock (including any Warrants to Purchase Shares
of Common Stock issued in exchange, transfer or replacement hereof, this "Warrant"), shall have the meanings set
forth in Section 17. This Warrant is one of the Warrants to purchase Common Stock (the "November Warrants") issued
pursuant to Section 1 of that certain Settlement Agreement and Mutual Release, dated as of November 2, 2015 (the "Subscription
Date"), by and between the Company and the Holder referred to therein (the "November Agreement"). Capitalized
terms used herein and not otherwise defined shall have the definitions ascribed to such terms in the November Agreement.

 

     

     

    

 

1.           EXERCISE OF WARRANT.

 

(a)Mechanics
of Exercise. Subject to the terms and conditions hereof (including, without limitation, the limitations set forth in Section
1(f)), this Warrant may be exercised by the Holder at any time or times on or after the Issuance Date, in whole or in part, by
(i) delivery of a written notice, in the form attached hereto as Exhibit A (the "Exercise Notice"),
of the Holder's election to exercise this Warrant and (ii) (A) payment to the Company of an amount equal to the applicable
Exercise Price multiplied by the number of Warrant Shares as to which this Warrant is being exercised (the "Aggregate Exercise
Price") in cash by wire transfer of immediately available funds or (B) if the provisions of Section 1(d) are applicable,
by notifying the Company that this Warrant is being exercised pursuant to a Cashless Exercise (as defined in Section 1(d)). The
Holder shall not be required to deliver the original Warrant in order to effect an exercise hereunder. Execution and delivery of
the Exercise Notice with respect to less than all of the Warrant Shares shall have the same effect as cancellation of the original
Warrant and issuance of a new Warrant evidencing the right to purchase the remaining number of Warrant Shares. On or before the
first (1st) Trading Day following the date on which the Company has received the Exercise Notice, the Company shall
transmit by facsimile an acknowledgment of confirmation of receipt of the Exercise Notice to the Holder and the Company's transfer
agent (the "Transfer Agent"). On or before the third (3rd) Trading Day following the date on which the Company
has received the Exercise Notice, so long as the Holder delivers the Aggregate Exercise Price (or notice of a Cashless Exercise)
on or prior to the second (2nd) Trading Day following the date on which the Company has received the Exercise Notice (the "Share
Delivery Date") (provided that if the Aggregate Exercise Price has not been delivered by such date, the Share Delivery
Date shall be one (1) Trading Day after the Aggregate Exercise Price (or notice of a Cashless Exercise) is delivered), the Company
shall (X) provided that the Transfer Agent is participating in The Depository Trust Company ("DTC") Fast Automated
Securities Transfer Program, credit such aggregate number of Warrant Shares to which the Holder is entitled pursuant to such exercise
to the Holder's or its designee's balance account with DTC through its Deposit / Withdrawal At Custodian system, or (Y) if the
Transfer Agent is not participating in the DTC Fast Automated Securities Transfer Program, issue and dispatch by overnight courier
to the address as specified in the Exercise Notice, 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. The Company
shall be responsible for all fees and expenses of the Transfer Agent and all fees and expenses with respect to the issuance of
Warrant Shares via DTC, if any. Upon delivery of the Exercise Notice, 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 such Warrant Shares are credited to the Holder's DTC account or the date of delivery of the certificates evidencing such Warrant
Shares, as the case may be. If this Warrant is submitted in connection with any exercise pursuant to this Section 1(a) and the
number of Warrant Shares represented by this Warrant submitted for exercise is greater than the number of Warrant Shares being
acquired upon an exercise, then the Company shall as soon as practicable and in no event later than three (3) Trading Days after
any exercise and at its own expense, issue a new Warrant (in accordance with Section 7(d)) representing the right to purchase the
number of Warrant Shares issuable immediately prior to such exercise under this Warrant, less the number of Warrant Shares with
respect to which this Warrant is exercised. No fractional Warrant Shares are to be issued upon the exercise of this Warrant, but
rather the number of Warrant Shares to be issued shall be rounded up to the nearest whole number. The Company shall pay any and
all taxes which may be payable with respect to the issuance and delivery of Warrant Shares upon exercise of this Warrant. The Company's
obligations to issue and deliver Warrant Shares in accordance with the terms and subject to the conditions hereof are absolute
and unconditional, irrespective of any action or inaction by the Holder to enforce the same, any waiver or consent with respect
to any provision hereof, the recovery of any judgment against any Person or any action to enforce the same, or any setoff, counterclaim,
recoupment, limitation or termination.

 

    	 	- 2 -	 

     

    

 

(b)Exercise
Price. For purposes of this Warrant, "Exercise Price" means $0.75, subject to adjustment as provided herein.

 

(c)Company's
Failure to Timely Deliver Securities. If the Company shall fail for any reason or for no reason to issue to the Holder on or
prior to the Share Delivery Date either (I) if the Transfer Agent is not participating in the DTC Fast Automated Securities Transfer
Program, a certificate for the number of shares of Common Stock to which the Holder is entitled and register such shares of Common
Stock on the Company's share register or if the Transfer Agent is participating in the DTC Fast Automated Securities Transfer Program,
to credit the Holder's balance account with DTC, for such number of shares of Common Stock to which the Holder is entitled upon
the Holder's exercise of this Warrant or (II) if a resale registration statement covering the resale of the Warrant Shares that
are the subject of the Exercise Notice (the "Unavailable Warrant Shares") is not available for the resale of such
Unavailable Warrant Shares and the Company fails to promptly (x) so notify the Holder and (y) deliver the Warrant Shares electronically
without any restrictive legend by crediting such aggregate number of Warrant Shares to which the Holder is entitled pursuant to
such exercise to the Holder's or its designee's balance account with DTC through its Deposit / Withdrawal At Custodian system (the
event described in the immediately foregoing clause (II) is hereinafter referred as a "Notice Failure" and together
with the event described in clause (I) above, an "Exercise Failure"), then, in addition to all other remedies
available to the Holder, (X) the Company shall pay in cash to the Holder on each day after the Share Delivery Date and during such
Exercise Failure an amount equal to 2.0% of the product of (A) the sum of the number of shares of Common Stock not issued to the
Holder on or prior to the Share Delivery Date and to which the Holder is entitled, and (B) any trading price of the Common Stock
selected by the Holder in writing as in effect at any time during the period beginning on the applicable Exercise Date and ending
on the applicable Share Delivery Date, and (Y) the Holder, upon written notice to the Company, may void its Exercise Notice with
respect to, and retain or have returned, as the case may be, any portion of this Warrant that has not been exercised pursuant to
such Exercise Notice; provided that the voiding of an Exercise Notice shall not affect the Company's obligations to make any payments
which have accrued prior to the date of such notice pursuant to this Section 1(c) or otherwise. In addition to the foregoing, if
on or prior to the Share Delivery Date either (I) if the Transfer Agent is not participating in the DTC Fast Automated Securities
Transfer Program, the Company shall fail to issue and deliver a certificate to the Holder and register such Common Stock on the
Company's share register or, if the Transfer Agent is participating in the DTC Fast Automated Securities Transfer Program, credit
the Holder's balance account with DTC for the number of shares of Common Stock to which the Holder is entitled upon the Holder's
exercise hereunder or pursuant to the Company's obligation pursuant to clause (ii) below or (II) a Notice Failure occurs, and if
on or after such Trading Day the Holder purchases (in an open market transaction or otherwise) Common Stock to deliver in satisfaction
of a sale by the Holder of Common Stock issuable upon such exercise that the Holder anticipated receiving from the Company (a "Buy-In"),
then the Company shall, within three (3) Trading Days after the Holder's request and in the Holder's discretion, either (i) pay
cash to the Holder in an amount equal to the Holder's total purchase price (including brokerage commissions and other out-of-pocket
expenses, if any) for the Common Stock so purchased (the "Buy-In Price"), at which point the Company's obligation
to deliver such certificate (and to issue such shares of Common Stock) or credit such Holder's balance account with DTC for such
shares of Common Stock shall terminate, or (ii) promptly honor its obligation to deliver to the Holder a certificate or certificates
representing such shares of Common Stock or credit such Holder's balance account with DTC, as applicable, and pay cash to the Holder
in an amount equal to the excess (if any) of the Buy-In Price over the product of (A) such number of shares of Common Stock, times
(B) any trading price of the Common Stock selected by the Holder in writing as in effect at any time during the period beginning
on the applicable Exercise Date and ending on the applicable Share Delivery Date. Nothing shall limit the Holder's right to pursue
any other remedies available to it hereunder, at law or in equity, including, without limitation, a decree of specific performance
and/or injunctive relief with respect to the Company's failure to timely deliver certificates representing such shares of Common
Stock (or to electronically deliver such shares of Common Stock) upon the exercise of this Warrant as required pursuant to the
terms hereof.

 

    	 	- 3 -	 

     

    

 

(d)Cashless
Exercise. At any time after May 2, 2016, notwithstanding anything contained herein to the contrary, if a resale
registration statement covering the resale of the Unavailable Warrant Shares is not available for the resale of such
Unavailable Warrant Shares, the Holder may, in its sole discretion, exercise this Warrant in whole or in part and, in lieu of
making the cash payment otherwise contemplated to be made to the Company upon such exercise in payment of the Aggregate
Exercise Price, elect instead to receive upon such exercise the "Net Number" of shares of Common Stock determined
according to the following formula (a "Cashless Exercise"):

 

Net Number
= (A x B) - (A x C)

B

 

For purposes
of the foregoing formula:

 

A= the
total number of shares with respect to which this Warrant is then being exercised.

 

B= the
last Closing Sale Price of the Common Stock at the time of delivery of the Exercise Notice.

 

C= the
Exercise Price then in effect for the applicable Warrant Shares at the time of such exercise.

 

For purposes of Rule
144(d) promulgated under the 1933 Act, as in effect on the date hereof, the Company hereby acknowledges and agrees that the Warrant
Shares issued in a Cashless Exercise shall be deemed to have been acquired by the Holder, and the holding period for the Warrant
Shares shall be deemed to have commenced, on the date this Warrant was originally issued pursuant to the November Agreement.

 

    	 	- 4 -	 

     

    

 

(e)Disputes.
In the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the Warrant Shares, the
Company shall promptly issue to the Holder the number of Warrant Shares that are not disputed and resolve such dispute in accordance
with Section 12.

 

(f)Beneficial
Ownership. Notwithstanding anything to the contrary contained herein, the Company shall not effect the exercise of any portion
of this Warrant, and the Holder shall not have the right to exercise any portion of this Warrant, pursuant to the terms and conditions
of this Warrant and any such exercise shall be null and void and treated as if never made, to the extent that after giving effect
to such exercise, the Holder together with the other Attribution Parties collectively would beneficially own in excess of 9.99%
(the "Maximum Percentage") of the number of shares of Common Stock outstanding immediately after giving effect
to such exercise. For purposes of the foregoing sentence, the aggregate number of shares of Common Stock beneficially owned by
the Holder and the other Attribution Parties shall include the number of shares of Common Stock held by the Holder and all other
Attribution Parties plus the number of shares of Common Stock issuable upon exercise of this Warrant with respect to which the
determination of such sentence is being made, but shall exclude the number of shares of Common Stock which would be issuable upon
(A) exercise of the remaining, unexercised portion of this Warrant beneficially owned by the Holder or any of the other Attribution
Parties and (B) exercise or conversion of the unexercised or unconverted portion of any other securities of the Company (including,
without limitation, any convertible notes or convertible preferred stock or warrants, including the other November Warrants) beneficially
owned by the Holder or any other Attribution Party subject to a limitation on conversion or exercise analogous to the limitation
contained in this Section 1(f). For purposes of this Section 1(f), beneficial ownership shall be calculated in accordance with
Section 13(d) of the Securities Exchange Act of 1934, as amended (the "1934 Act"). For purposes of this Warrant,
in determining the number of outstanding shares of Common Stock the Holder may acquire upon the exercise of this Warrant without
exceeding the Maximum Percentage, the Holder may rely on the number of outstanding shares of Common Stock as reflected in (x) the
Company's most recent Annual Report on Form 10-K, Quarterly Report on Form 10-Q, Current Report on Form 8-K or other public filing
with the Securities and Exchange Commission (the "SEC"), as the case may be, (y) a more recent public announcement
by the Company or (3) any other written notice by the Company or the Transfer Agent setting forth the number of shares of Common
Stock outstanding (the "Reported Outstanding Share Number"). If the Company receives an Exercise Notice from the
Holder at a time when the actual number of outstanding shares of Common Stock is less than the Reported Outstanding Share Number,
the Company shall (i) notify the Holder in writing of the number of shares of Common Stock then outstanding and, to the extent
that such Exercise Notice would otherwise cause the Holder's beneficial ownership, as determined pursuant to this Section 1(f),
to exceed the Maximum Percentage, the Holder must notify the Company of a reduced number of Warrant Shares to be purchased pursuant
to such Exercise Notice (the number of shares by which such purchase is reduced, the "Reduction Shares") and (ii)
as soon as reasonably practicable, the Company shall return to the Holder any exercise price paid by the Holder for the Reduction
Shares. For any reason at any time, upon the written or oral request of the Holder, the Company shall within one (1) Business Day
confirm orally and in writing or by electronic mail to the Holder the number of shares of Common Stock then outstanding. In any
case, the number of outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of
securities of the Company, including this Warrant, by the Holder and any other Attribution Party since the date as of which the
Reported Outstanding Share Number was reported. In the event that the issuance of Common Stock to the Holder upon exercise of this
Warrant results in the Holder and the other Attribution Parties being deemed to beneficially own, in the aggregate, more than the
Maximum Percentage of the number of outstanding shares of Common Stock (as determined under Section 13(d) of the 1934 Act), the
number of shares so issued by which the Holder's and the other Attribution Parties' aggregate beneficial ownership exceeds the
Maximum Percentage (the "Excess Shares") shall be deemed null and void and shall be cancelled ab initio, and the
Holder shall not have the power to vote or to transfer the Excess Shares. As soon as reasonably practicable after the issuance
of the Excess Shares has been deemed null and void, the Company shall return to the Holder the exercise price paid by the Holder
for the Excess Shares. Upon delivery of a written notice to the Company, the Holder may from time to time increase (with such increase
not effective until the sixty-first (61st) day after delivery of such notice) or decrease the Maximum Percentage to
any other percentage not in excess of 9.99% as specified in such notice; provided that (i) any such increase in the Maximum Percentage
will not be effective until the sixty-first (61st) day after such notice is delivered to the Company and (ii) any such
increase or decrease will apply only to the Holder and the other Attribution Parties and not to any other holder of November Warrants
that is not an Attribution Party of the Holder. For purposes of clarity, the shares of Common Stock issuable pursuant to the terms
of this Warrant in excess of the Maximum Percentage shall not be deemed to be beneficially owned by the Holder for any purpose
including for purposes of Section 13(d) or Rule 16a-1(a)(1) of the 1934 Act. No prior inability to exercise this Warrant pursuant
to this paragraph shall have any effect on the applicability of the provisions of this paragraph with respect to any subsequent
determination of exercisability. The provisions of this paragraph shall be construed and implemented in a manner otherwise than
in strict conformity with the terms of this Section 1(f) to the extent necessary to correct this paragraph or any portion of this
paragraph which may be defective or inconsistent with the intended beneficial ownership limitation contained in this Section 1(f)
or to make changes or supplements necessary or desirable to properly give effect to such limitation. The limitation contained in
this paragraph may not be waived and shall apply to a successor holder of this Warrant.

 

    	 	- 5 -	 

     

    

 

(g)Insufficient
Authorized Shares. If at any time while this Warrant remains outstanding the Company does not have a sufficient number of authorized
and unreserved shares of Common Stock to satisfy its obligation to reserve for issuance upon exercise of this Warrant at least
a number of shares of Common Stock equal to the number of shares of Common Stock as shall from time to time be necessary to effect
the exercise of all of this Warrant then outstanding (the "Required Reserve Amount" and the failure to have such
sufficient number of authorized and unreserved shares of Common Stock, an "Authorized Share Failure"), then the
Company shall immediately take all action necessary to increase the Company's authorized number of shares of Common Stock to an
amount sufficient to allow the Company to reserve the Required Reserve Amount for this Warrant then outstanding. Without limiting
the generality of the foregoing sentence, as soon as practicable after the date of the occurrence of an Authorized Share Failure,
but in no event later than ninety (90) days after the occurrence of such Authorized Share Failure, the Company shall hold a meeting
of its shareholders for the approval of an increase in the number of authorized shares of Common Stock. In connection with such
meeting, the Company shall provide each shareholder with a proxy statement and shall use its best efforts to solicit its shareholders'
approval of such increase in authorized shares of Common Stock and to cause its board of directors to recommend to the shareholders
that they approve such proposal. Notwithstanding the foregoing, if any such time of an Authorized Share Failure, the Company is
able to obtain the written consent of a majority of the shares of its issued and outstanding shares of Common Stock to approve
the increase in the number of authorized shares of Common Stock, the Company may satisfy this obligation by obtaining such consent
and submitting for filing with the SEC an Information Statement on Schedule 14C. In the event that upon any exercise of this Warrant,
the Company does not have sufficient authorized shares to deliver in satisfaction of such exercise, then unless the Holder elects
to void such attempted exercise, the Holder may require the Company to pay to the Holder within three (3) Trading Days of the applicable
exercise, cash in an amount equal to the product of (i) the quotient determined by dividing (x) the number of Warrant Shares that
the Company is unable to deliver pursuant to this Section 1(g), by (y) the total number of Warrant Shares issuable upon exercise
of this Warrant (without regard to any limitations or restrictions on exercise of this Warrant) and (ii) the Black Scholes Value."

 

    	 	- 6 -	 

     

    

 

(h)Mandatory
Exercise. If at any time from and after the Issuance Date (i) the Weighted Average Price of the Common Stock listed on the
Principal Market equals or exceeds $2.00 (subject to appropriate adjustments for stock splits, stock dividends, recapitalizations,
reorganizations, reclassifications, combinations, reverse stock splits or other similar transactions after the Subscription Date)
for not less than ten (10) consecutive Trading Days (the "Mandatory Exercise Measuring Period") and (ii) no Equity
Conditions Failure has occurred (unless the Holder has waived such Equity Conditions Failure) as of such date (clauses (A) and
(B), the "Mandatory Exercise Conditions"), the Company shall have the right to require the Holder to exercise
all or any portion of the Warrants then remaining under this Warrant, as designated in the Mandatory Exercise Notice on the Mandatory
Exercise Date (each as defined below) into fully paid, validly issued and nonassessable shares of Common Stock in accordance with
Section 1 hereof at the Exercise Price as of the Mandatory Exercise Date (as defined below) (a "Mandatory Exercise").
The Company may exercise its right to require exercise under this Section 1(h) by delivering within not more than two (2) Trading
Days following the end of such Mandatory Exercise Measuring Period a written notice thereof by facsimile and overnight courier
to the Holder and the Transfer Agent (the "Mandatory Exercise Notice" and the date the Holder received such notice
is referred to as the "Mandatory Exercise Notice Date"). The Mandatory Exercise Notice shall be irrevocable. The
Mandatory Exercise Notice shall (x) state (I) the Trading Day on which the Mandatory Exercise shall occur, which Trading Day shall
not be less than five (5) Trading Days nor more than ten (10) Trading Days following the Mandatory Exercise Notice Date (the "Mandatory
Exercise Date"), (II) the aggregate number of Warrants which the Company has elected to be subject to Mandatory Exercise
from the Holder (the "Mandatory Exercise Amount") pursuant to this Section 1(h), (III) the number of shares of
Common Stock to be issued to the Holder on the Mandatory Exercise Date and (y) certify that the Mandatory Exercise Conditions have
been satisfied. The Mandatory Exercise thereunder may only occur on the Mandatory Exercise Date if there is no Equity Conditions
Failure (unless the Holder has waived such Equity Conditions Failure) that occurs immediately prior to the Mandatory Exercise Date
(the "Mandatory Exercise Bring-Down Conditions"). The Company shall deliver to the Holder a notice no later than
10:00 a.m., New York Time, on the Mandatory Exercise Date (the "Bring-Down Notice"), which notice shall certify
whether or not the Mandatory Exercise Bring-Down Conditions have been satisfied. If the Mandatory Exercise Bring-Down Conditions
have not been satisfied at such time (and are not waived by the Holder), the Mandatory Exercise Notice will be null and void, ab
initio. The Company may not effect more than one (1) Mandatory Exercise during any sixty (60) consecutive Trading Day period.
Notwithstanding anything to the contrary in this Section 3(i)(i), until the Mandatory Exercise has occurred, the Mandatory Exercise
Amount may be exercised, in whole or in part, by the Holder into shares of Common Stock pursuant to Section 1. The Company covenants
and agrees that it will honor all Exercise Notices tendered from the time of delivery of the Mandatory Exercise Notice until the
Mandatory Exercise has occurred. Unless otherwise indicated by the Holder, all Warrants exercised by the Holder after the Mandatory
Exercise Notice Date shall reduce the Mandatory Exercise Amount of this Warrant required to be exercised on the Mandatory Exercise
Date. Upon an Equity Conditions Failure, the Holder may revoke any Exercise Notice delivered after the Mandatory Exercise Notice
is received by the Holder and the Company, within one (1) Business Day of such revocation, shall return the Aggregate Exercise
Price applicable to any such Exercise Notice(s) to the Holder by wire transfer of immediately available funds and any November Warrants
so exercised shall be deemed reinstated and returned to the Holders, if applicable.

 

    	 	- 7 -	 

     

    

 

2.        ADJUSTMENT
OF EXERCISE PRICE AND NUMBER OF WARRANT SHARES. The Exercise Price and the number of Warrant Shares shall be adjusted from
time to time as follows:

 

(a)Adjustment
Upon Subdivision or Combination of Common Stock. If the Company at any time on or after the Subscription Date subdivides (by
any stock split, stock dividend, recapitalization or otherwise) one or more classes of its outstanding shares of Common Stock into
a greater number of shares, the Exercise Price in effect immediately prior to such subdivision will be proportionately reduced
and the number of Warrant Shares will be proportionately increased. If the Company at any time on or after the Subscription Date
combines (by combination, reverse stock split or otherwise) one or more classes of its outstanding shares of Common Stock into
a smaller number of shares, the Exercise Price in effect immediately prior to such combination will be proportionately increased
and the number of Warrant Shares will be proportionately decreased. Any adjustment under this Section 2(c) shall become effective
at the close of business on the date the subdivision or combination becomes effective.

 

(b)Voluntary
Adjustment By Company. The Company may at any time during the term of this Warrant, with the prior written consent of the Required
Holders, reduce the then current Exercise Price to any amount and for any period of time deemed appropriate by the Board of Directors
of the Company.

 

    	 	- 8 -	 

     

    

 

3.          RIGHTS UPON
DISTRIBUTION OF ASSETS. 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 Stock, by way of return of capital or otherwise (including, without limitation, any distribution
of cash, stock or other securities, property, options, evidence of indebtedness or any other assets by way of a dividend, spin
off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a "Distribution"),
at any time after the issuance of this Warrant, then, in each such case, the Holder shall be entitled to participate in such Distribution
to the same extent that the Holder would have participated therein if the Holder had held the number of shares of Common Stock
acquirable upon complete exercise of this Warrant (without regard to any limitations or restrictions on exercise of this Warrant,
including without limitation, the Maximum Percentage) 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 Stock are to be determined for the participation
in such Distribution (provided, however, that to the extent that the Holder's right to participate in any such Distribution
would result in the Holder and the other Attribution Parties exceeding the Maximum Percentage, then the Holder shall not be entitled
to participate in such Distribution to such extent (and shall not be entitled to beneficial ownership of such shares of Common
Stock as a result of such Distribution (and beneficial ownership) to such extent) and the portion of such Distribution shall be
held in abeyance for the benefit of the Holder until such time or times as its right thereto would not result in the Holder and
the other Attribution Parties exceeding the Maximum Percentage, at which time or times the Holder shall be granted such Distribution
(and any Distributions declared or made on such initial Distribution or on any subsequent Distribution held similarly in abeyance)
to the same extent as if there had been no such limitation).

 

4.         PURCHASE
RIGHTS; FUNDAMENTAL TRANSACTIONS.

 

(c)Purchase
Rights. In addition to any adjustments pursuant to Section 2 above, if at any time the Company grants, issues or sells any
Options, Convertible Securities or rights to purchase stock, warrants, securities or other property pro rata to the record holders
of any class of Common Stock (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 shares of Common Stock acquirable upon complete exercise of this Warrant (without regard to any limitations or restrictions
on exercise of this Warrant, including without limitation, the Maximum Percentage) 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 Stock are to be determined for the grant, issue or sale of such Purchase Rights (provided, however,
that to the extent that the Holder's right to participate in any such Purchase Right would result in the Holder and the other Attribution
Parties exceeding the Maximum Percentage, then the Holder shall not be entitled to participate in such Purchase Right to such extent
(and shall not be entitled to beneficial ownership of such shares of Common Stock as a result of such Purchase Right (and beneficial
ownership) to such extent) and such Purchase Right to such extent shall be held in abeyance for the benefit of the Holder until
such time or times as its right thereto would not result in the Holder and the other Attribution Parties exceeding the Maximum
Percentage, at which time or times the Holder shall be granted such right (and any Purchase Right granted, issued or sold on such
initial Purchase Right or on any subsequent Purchase Right held similarly in abeyance) to the same extent as if there had been
no such limitation).

 

    	 	- 9 -	 

     

    

 

(d)Fundamental
Transactions. The Company shall not enter into or be party to a Fundamental Transaction unless (i) the Successor Entity assumes
in writing all of the obligations of the Company under this Warrant in accordance with the provisions of this Section 4(b) pursuant
to written agreements in form and substance satisfactory to the Holder and approved by the Holder prior to such Fundamental Transaction,
including agreements to 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, including, without limitation, which is exercisable for
a corresponding number of shares of capital stock equivalent to the shares of Common Stock acquirable and receivable upon exercise
of this Warrant (without regard to any limitations on the exercise of this Warrant) prior to such Fundamental Transaction, and
with an exercise price which applies the exercise price hereunder to such shares of capital stock (but taking into account the
relative value of the shares of Common Stock pursuant to such Fundamental Transaction and the value of such shares of capital stock,
such adjustments to the 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) and (ii) if the Fundamental Transaction
occurs within six (6) months of August 19, 2015, the Successor Entity (including its Parent Entity) is a publicly traded corporation
whose common stock is quoted on or listed for trading on an Eligible Market. Upon the consummation of each Fundamental Transaction,
the Successor Entity shall succeed to, and be substituted for (so that from and after the date of the applicable 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. Upon consummation of each Fundamental Transaction, the Successor
Entity shall deliver to the Holder confirmation that there shall be issued upon exercise of this Warrant at any time after the
consummation of the applicable Fundamental Transaction, in lieu of the shares of Common Stock (or other securities, cash, assets
or other property (except such items still issuable under Sections 3 and 4(a) above, which shall continue to be receivable thereafter
issuable upon the exercise of this Warrant prior to the applicable Fundamental Transaction, such shares of publicly traded common
stock (or its equivalent) of the Successor Entity (including its Parent Entity) which the Holder would have been entitled to receive
upon the happening of the applicable Fundamental Transaction had this Warrant been exercised immediately prior to the applicable
Fundamental Transaction (without regard to any limitations on the exercise of this Warrant), as adjusted in accordance with the
provisions of this Warrant. Notwithstanding the foregoing, and without limiting Section 1(f) hereof, the Holder may elect, at its
sole option, by delivery of written notice to the Company to waive this Section 4(b) to permit the Fundamental Transaction without
the assumption of this Warrant. In addition to and not in substitution for any other rights hereunder, prior to the consummation
of each Fundamental Transaction pursuant to which holders of shares of Common Stock are entitled to receive securities or other
assets with respect to or in exchange for shares of Common Stock (a "Corporate Event"), the Company shall make
appropriate provision to insure that the Holder will thereafter have the right to receive upon an exercise of this Warrant at any
time after the consummation of the applicable Fundamental Transaction but prior to the Expiration Date, in lieu of the shares of
the Common Stock (or other securities, cash, assets or other property (except such items still issuable under Sections 3 and 4(a)
above, which shall continue to be receivable thereafter» issuable upon the exercise of the Warrant prior to such Fundamental
Transaction, such shares of stock, securities, cash, assets or any other property whatsoever (including warrants or other purchase
or subscription rights) which the Holder would have been entitled to receive upon the happening of the applicable Fundamental Transaction
had this Warrant been exercised immediately prior to the applicable Fundamental Transaction (without regard to any limitations
on the exercise of this Warrant). Provision made pursuant to the preceding sentence shall be in a form and substance reasonably
satisfactory to the Holder.

 

    	 	- 10 -	 

     

    

 

5.           NONCIRCUMVENTION.
The Company hereby covenants and agrees that the Company will not, by amendment of its Articles of Incorporation or Bylaws, or
through any reorganization, transfer of assets, consolidation, merger, scheme of arrangement, 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, and will
at all times in good faith carry out all of the provisions of this Warrant and take all action as may be required to protect the
rights of the Holder. Without limiting the generality of the foregoing, the Company (i) shall not increase the par value of
any Common Stock receivable upon the exercise of this Warrant above the Exercise Price then in effect, (ii) shall take all
such actions as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable
Common Stock upon the exercise of this Warrant, and (iii) shall, so long as any of the November Warrants are outstanding, take all
action necessary to reserve and keep available out of its authorized and unissued shares of Common Stock, solely for the purpose
of effecting the exercise of the November Warrants, the number of shares of Common Stock as shall from time to time be necessary
to effect the exercise of the November Warrants then outstanding (without regard to any limitations on exercise).

 

6.         WARRANT
HOLDER NOT DEEMED A SHAREHOLDER. Except as otherwise specifically provided herein, the Holder, solely in such Person's capacity
as a holder of this Warrant, 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 be construed to confer upon the Holder, solely in such Person's
capacity as the Holder of this Warrant, any of the rights of a shareholder of the Company or any right to vote, give or withhold
consent to any corporate action (whether any reorganization, issue of stock, reclassification of stock, consolidation, merger,
conveyance or otherwise), receive notice of meetings, receive dividends or subscription rights, or otherwise, prior to the issuance
to the Holder of the Warrant Shares which such Person is then entitled to receive upon the due exercise of this Warrant. In addition,
nothing contained in this Warrant shall be construed as imposing any liabilities on the Holder to purchase any securities (upon
exercise of this Warrant or otherwise) or as a shareholder of the Company, whether such liabilities are asserted by the Company
or by creditors of the Company. Notwithstanding this Section 6, the Company shall provide the Holder with copies of the same notices
and other information given to the shareholders of the Company generally, contemporaneously with the giving thereof to the shareholders.

 

7.         REISSUANCE
OF WARRANTS.

 

(a)Transfer
of Warrant. If this Warrant is to be transferred, the Holder shall surrender this Warrant to the Company, whereupon the Company
will forthwith issue and deliver upon the order of the Holder a new Warrant (in accordance with Section 7(d)), registered as the
Holder may request, representing the right to purchase the number of Warrant Shares being transferred by the Holder and, if less
than the total number of Warrant Shares then underlying this Warrant is being transferred, a new Warrant (in accordance with Section
7(d)) to the Holder representing the right to purchase the number of Warrant Shares not being transferred.

 

    	 	- 11 -	 

     

    

 

(b)Lost, Stolen
or Mutilated Warrant. Upon receipt by the Company of evidence reasonably satisfactory to the Company of the loss, theft, destruction
or mutilation of this Warrant, and, in the case of loss, theft or destruction, of any indemnification undertaking by the Holder
to the Company in customary form and, in the case of mutilation, upon surrender and cancellation of this Warrant, the Company shall
execute and deliver to the Holder a new Warrant (in accordance with Section 7(d)) representing the right to purchase the Warrant
Shares then underlying this Warrant.

 

(c)Exchangeable
for Multiple Warrants. This Warrant is exchangeable, upon the surrender hereof by the Holder at the principal office of the
Company, for a new Warrant or Warrants (in accordance with Section 7(d)) representing in the aggregate the right to purchase the
number of Warrant Shares then underlying this Warrant, and each such new Warrant will represent the right to purchase such portion
of such Warrant Shares as is designated by the Holder at the time of such surrender; provided, however, that no November
Warrants for fractional Warrant Shares shall be given.

 

(d)Issuance
of New Warrants. Whenever the Company is required to issue a new Warrant pursuant to the terms of this Warrant, such new Warrant
(i) shall be of like tenor with this Warrant, (ii) shall represent, as indicated on the face of such new Warrant, the right to
purchase the Warrant Shares then underlying this Warrant (or in the case of a new Warrant being issued pursuant to Section 7(a)
or Section 7(c), the Warrant Shares designated by the Holder which, when added to the number of shares of Common Stock underlying
the other new Warrants issued in connection with such issuance, does not exceed the number of Warrant Shares then underlying this
Warrant), (iii) shall have an issuance date, as indicated on the face of such new Warrant which is the same as the Issuance Date,
and (iv) shall have the same rights and conditions as this Warrant.

 

8.         NOTICES.
Whenever notice is required to be given under this Warrant, unless otherwise provided herein, such notice shall be given in accordance
with Section 9 of the November Agreement. The Company shall provide the Holder with prompt written notice of all actions taken pursuant
to this Warrant, including in reasonable detail a description of such action and the reason therefor. Without limiting the generality
of the foregoing, the Company will give written notice to the Holder (i) immediately upon any adjustment of the Exercise Price,
setting forth in reasonable detail, and certifying, the calculation of such adjustment and (ii) at least fifteen (15) days prior
to the date on which the Company closes its books or takes a record (A) with respect to any dividend or distribution upon Common
Stock, (B) with respect to any grants, issuances or sales of any Options, Convertible Securities or rights to purchase stock, warrants,
securities or other property to holders of Common Stock or (C) for determining rights to vote with respect to any Fundamental Transaction,
dissolution or liquidation; provided in each case that such information shall be made known to the public prior to or in
conjunction with such notice being provided to the Holder. It is expressly understood and agreed that the time of exercise specified
by the Holder in each Exercise Notice shall be definitive and may not be disputed or challenged by the Company.

 

    	 	- 12 -	 

     

    

 

9.         AMENDMENT
AND WAIVER. Except as otherwise provided herein, the provisions of this Warrant may be amended or waived and the Company may
take any action herein prohibited, or omit to perform any act herein required to be performed by it, only if the Company has obtained
the written consent of the Holder.

 

10.       GOVERNING
LAW; JURISDICTION; JURY TRIAL. This Warrant shall be governed by and construed and enforced in accordance with, and all questions
concerning the construction, validity, interpretation and performance of this Warrant shall be governed by, the internal laws of
the State of New York, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of
New York or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of
New York. The Company hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in The City
of New York, Borough of Manhattan, for the adjudication of any dispute hereunder or in connection herewith or with any transaction
contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding,
any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought
in an inconvenient forum or that the venue of such suit, action or proceeding is improper. The Company hereby irrevocably waives
personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof
to the Company at the address set forth in Section 9 of the November Agreement and agrees that such service shall constitute good
and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to
serve process in any manner permitted by law. Nothing contained herein shall be deemed or operate to preclude the Holder from bringing
suit or taking other legal action against the Company in any other jurisdiction to collect on the Company's obligations to the
Holder, to realize on any collateral or any other security for such obligations, or to enforce a judgment or other court ruling
in favor of the Holder. THE COMPANY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL
FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS WARRANT OR ANY TRANSACTION CONTEMPLATED
HEREBY.

 

11.       CONSTRUCTION;
HEADINGS. This Warrant shall be deemed to be jointly drafted by the Company and the Holder and shall not be construed against
any Person as the drafter hereof. The headings of this Warrant are for convenience of reference and shall not form part of, or
affect the interpretation of, this Warrant.

 

    	 	- 13 -	 

     

    

 

12.       DISPUTE
RESOLUTION. In the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the Warrant
Shares, the Company shall submit the disputed determinations or arithmetic calculations via facsimile within two (2) Business Days
of receipt of the Exercise Notice giving rise to such dispute, as the case may be, to the Holder. If the Holder and the Company
are unable to agree upon such determination or calculation of the Exercise Price or the Warrant Shares within three (3) Business
Days of such disputed determination or arithmetic calculation being submitted to the Holder, then the Company shall, within two
(2) Business Days submit via facsimile (a) the disputed determination of the Exercise Price to an independent, reputable investment
bank selected by the Company and approved by the Holder or (b) the disputed arithmetic calculation of the Warrant Shares to the
Company's independent, outside accountant. The Company shall cause at its expense the investment bank or the accountant, as the
case may be, to perform the determinations or calculations and notify the Company and the Holder of the results no later than ten
(10) Business Days from the time it receives the disputed determinations or calculations. Such investment bank's or accountant's
determination or calculation, as the case may be, shall be binding upon all parties absent demonstrable error.

 

13.       REMEDIES,
OTHER OBLIGATIONS, BREACHES AND INJUNCTIVE RELIEF. The remedies provided in this Warrant shall be cumulative and in addition
to all other remedies available under this Warrant and the other Transaction Documents, at law or in equity (including a decree
of specific performance and/or other injunctive relief), and nothing herein shall limit the right of the Holder to pursue actual
damages for any failure by the Company to comply with the terms of this Warrant. The Company acknowledges that a breach by it of
its obligations hereunder will cause irreparable harm to the Holder and that the remedy at law for any such breach may be inadequate.
The Company therefore agrees that, in the event of any such breach or threatened breach, the holder of this Warrant shall be entitled,
in addition to all other available remedies, to an injunction restraining any breach, without the necessity of showing economic
loss and without any bond or other security being required.

 

14.       TRANSFER.This
Warrant may be offered for sale, sold, transferred, pledged or assigned without the consent of the Company, except as may otherwise
be required to assure compliance with applicable securities laws.

 

15.       SEVERABILITY.If
any provision of this Warrant is prohibited by law or otherwise determined to be invalid or unenforceable by a court of competent
jurisdiction, the provision that would otherwise be prohibited, invalid or unenforceable shall be deemed amended to apply to the
broadest extent that it would be valid and enforceable, and the invalidity or unenforceability of such provision shall not affect
the validity of the remaining provisions of this Warrant so long as this Warrant as so modified continues to express, without material
change, the original intentions of the parties as to the subject matter hereof and the prohibited nature, invalidity or unenforceability
of the provision(s) in question does not substantially impair the respective expectations or reciprocal obligations of the parties
or the practical realization of the benefits that would otherwise be conferred upon the parties. The parties will endeavor in good
faith negotiations to replace the prohibited, invalid or unenforceable provision(s) with a valid provision(s), the effect of which
comes as close as possible to that of the prohibited, invalid or unenforceable provision(s).

 

    	 	- 14 -	 

     

    

 

16.       DISCLOSURE.
Upon receipt or delivery by the Company of any notice in accordance with the terms of this Warrant, unless the Company has in good
faith determined that the matters relating to such notice do not constitute material, nonpublic information relating to the Company
or its subsidiaries, the Company shall within one (1) Business Day after any such receipt or delivery publicly disclose such material,
nonpublic information on a Current Report on Form 8-K or otherwise. In the event that the Company believes that a notice contains
material, nonpublic information relating to the Company or its Subsidiaries, the Company so shall indicate to such Holder contemporaneously
with delivery of such notice, and in the absence of any such indication, the Holder shall be allowed to presume that all matters
relating to such notice do not constitute material, nonpublic information relating to the Company or its Subsidiaries.

 

17.      CERTAIN
DEFINITIONS. For purposes of this Warrant, the following terms shall have the following meanings:

 

(a)"1933
Act" means the Securities Act of 1933, as amended.

 

(b)"Affiliate"
means, with respect to any Person, any other Person that directly or indirectly controls, is controlled by, or is under common
control with, such Person, it being understood for purposes of this definition that "control" of a Person means the power
directly or indirectly either to vote 10% or more of the stock having ordinary voting power for the election of directors of such
Person or direct or cause the direction of the management and policies of such Person whether by contract or otherwise.

 

(c)"Attribution
Parties" means, collectively, the following Persons and entities: (i) any investment vehicle, including, any funds, feeder
funds or managed accounts, currently, or from time to time after the Issuance Date, directly or indirectly managed or advised by
the Holder's investment manager or any of its Affiliates or principals, (ii) any direct or indirect Affiliates of the Holder or
any of the foregoing, (iii) any Person acting or who could be deemed to be acting as a Group together with the Holder or any of
the foregoing and (iv) any other Persons whose beneficial ownership of the Company's Common Stock would or could be aggregated
with the Holder's and the other Attribution Parties for purposes of Section 13(d) of the 1934 Act. For clarity, the purpose of
the foregoing is to subject collectively the Holder and all other Attribution Parties to the Maximum Percentage.

 

(d)"Black
Scholes Value" means the value of this Warrant based on the Black-Scholes Option Pricing Model obtained from the "OV"
function on Bloomberg determined as of the date the Holder exercises this Warrant and the Company cannot deliver the required number
of Warrant Shares because of an Authorized Share Failure, for pricing purposes and reflecting (i) a risk-free interest rate corresponding
to the U.S. Treasury rate for a period equal to the remaining term of this Warrant as of such date of request, (ii) an expected
volatility equal to the greater of 100% and the 100 day volatility obtained from the HVT function on Bloomberg as of the date the
Holder exercises this Warrant and the Company cannot deliver the required number of Warrant Shares because of an Authorized Share
Failure, (iii) the underlying price per share used in such calculation shall be the highest Weighted Average Price during the period
beginning on the date of the applicable date of exercise and the date that the Company makes the applicable cash payment, (iv)
a zero cost of borrow and (v) a 360 day annualization factor.

 

(e)"Bloomberg"
means Bloomberg Financial Markets.

 

    	 	- 15 -	 

     

    

 

(f)"Business
Day" means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized
or required by law to remain closed.

 

(g)"Closing
Bid Price" and "Closing Sale Price" means, for any security as of any date, the last closing bid price
and last closing trade price, respectively, for such security on the Principal Market, as reported by Bloomberg, or, if the Principal
Market begins to operate on an extended hours basis and does not designate the closing bid price or the closing trade price, as
the case may be, then the last bid price or the last trade price, respectively, of such security prior to 4:00:00 p.m., New York
time, as reported by Bloomberg, or, if the Principal Market is not the principal securities exchange or trading market for such
security, the last closing bid price or last trade price, respectively, of such security on the principal securities exchange or
trading market where such security is listed or traded as reported by Bloomberg, or if the foregoing do not apply, the last closing
bid price or last trade price, respectively, of such security in the over-the-counter market on the electronic bulletin board for
such security as reported by Bloomberg, or, if no closing bid price or last trade price, respectively, is reported for such security
by Bloomberg, the average of the bid prices, or the ask prices, respectively, of any market makers for such security as reported
in the OTC Link or "pink sheets" by OTC Markets Group Inc. (formerly Pink OTC Markets Inc.). If the Closing Bid Price
or the Closing Sale Price cannot be calculated for a security on a particular date on any of the foregoing bases, the Closing Bid
Price or the Closing Sale Price, as the case may be, of such security on such date shall be the fair market value as mutually determined
by the Company and the Holder. If the Company and the Holder are unable to agree upon the fair market value of such security, then
such dispute shall be resolved pursuant to Section 12. All such determinations to be appropriately adjusted for any stock dividend,
stock split, stock combination, reclassification or other similar transaction during the applicable calculation period.

 

(h)"Common
Stock" means (i) the Company's Common Stock, par value $0.00001 per share, and (ii) any share capital into which
such shares of Common Stock shall have been changed or any share capital resulting from a reclassification of such Common Stock.

 

(i)"Convertible
Securities" means any stock or securities (other than Options) directly or indirectly convertible into or exercisable
or exchangeable for Common Stock.

 

(j)"Eligible
Market" means the Principal Market, the NYSE MKT LLC, The NASDAQ Global Select Market, The NASDAQ Global Market or The
New York Stock Exchange, Inc.

 

    	 	- 16 -	 

     

    

 

(k)"Equity
Conditions" means each of the following conditions: (i) on each day during the period beginning thirty (30) Trading Days
prior to the applicable date of determination and ending on and including the applicable date of determination (the "Equity
Conditions Measuring Period"), a resale registration statement shall be effective and available for the resale of all
remaining shares of Common Stock underlying the November Warrants; (ii) on each day during the Equity Conditions Measuring Period,
the Common Stock is designated for quotation on the Principal Market or any other Eligible Market and shall not have been suspended
from trading on such exchange or market (other than suspensions of not more than two (2) days and occurring prior to the applicable
date of determination due to business announcements by the Company); (iii) during the Equity Conditions Measuring Period, the Company
shall have delivered shares of Common Stock upon exercise of the November Warrants to the Holder on a timely basis as set forth
in Section 1(a) (and analogous provisions under the other November Warrants) hereof and Section 1 of all other warrants of the Company
held by the Holder; (iv) any applicable shares of Common Stock to be issued in connection with the event requiring determination
may be issued in full without violating Section 1(f) hereof and the rules or regulations of the Principal Market or any other applicable
Eligible Market; (v) during the Equity Conditions Measuring Period, the Company shall not have failed to timely make any payments
within five (5) Business Days of when such payment is due pursuant to any Transaction Document; (vi) during the Equity Conditions
Measuring Period, there shall not have occurred the public announcement of a pending, proposed or intended Fundamental Transaction
which has not been abandoned, terminated or consummated; (vii) the Company shall have no knowledge of any fact that would cause
a resale registration statement not to be effective and available for the resale of all shares of Common Stock underlying the November
Warrants; (viii) the Company otherwise shall have been in compliance with and shall not have breached any provision, covenant,
representation or warranty of any Transaction Document; (ix) no Holder shall be in possession of any material, nonpublic information
received from the Company, any Subsidiary or its respective agent or affiliates; and (x) the shares of Common Stock issuable pursuant
the event requiring the satisfaction of the Equity Conditions are duly authorized and listed and eligible for trading without restriction
on an Eligible Market.

 

(l)"Equity
Conditions Failure" means that on any day during the period commencing ten (10) Trading Days prior to the applicable date
of determination through the applicable date of determination, the Equity Conditions have not been satisfied (or waived in writing
by the Holder).

 

(m)"Expiration
Date" means the date thirty-six (36) months after the Issuance Date or, if such date falls on a day other than a Business
Day or on which trading does not take place on the Principal Market (a "Holiday"), the next day that is not a
Holiday.

 

    	 	- 17 -	 

     

    

 

(n)"Fundamental
Transaction" means (A) that the Company shall, directly or indirectly, including through subsidiaries, Affiliates or otherwise,
in one or more related transactions, (i) consolidate or merge with or into (whether or not the Company is the surviving corporation)
another Subject Entity, or (ii) sell, assign, transfer, convey or otherwise dispose of all or substantially all of the properties
or assets of the Company or any of its "significant subsidiaries" (as defined in Rule 1-02 of Regulation S-X) to one
or more Subject Entities, or (iii) make, or allow one or more Subject Entities to make, or allow the Company to be subject to or
have its Common Stock be subject to or party to one or more Subject Entities making, a purchase, tender or exchange offer that
is accepted by the holders of at least either (x) 50% of the outstanding shares of Common Stock, (y) 50% of the outstanding shares
of Common Stock calculated as if any Common Stock held by all Subject Entities making or party to, or Affiliated with any Subject
Entities making or party to, such purchase, tender or exchange offer were not outstanding; or (z) such number of shares of Common
Stock such that all Subject Entities making or party to, or Affiliated with any Subject Entity making or party to, such purchase,
tender or exchange offer, become collectively the beneficial owners (as defined in Rule 13d-3 under the 1934 Act) of at least 50%
of the outstanding shares of Common Stock, or (iv) consummate a stock purchase agreement or other business combination (including,
without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with one or more Subject Entities whereby
all such Subject Entities, individually or in the aggregate, acquire, either (x) at least 50% of the outstanding shares of Common
Stock, (y) at least 50% of the outstanding shares of Common Stock calculated as if any Common Stock held by all the Subject Entities
making or party to, or Affiliated with any Subject Entity making or party to, such stock purchase agreement or other business combination
were not outstanding; or (z) such number of shares of Common Stock such that the Subject Entities become collectively the beneficial
owners (as defined in Rule 13d-3 under the 1934 Act) of at least 50% of the outstanding shares of Common Stock, or (v) reorganize,
recapitalize or reclassify its Common Stock, (B) that the Company shall, directly or indirectly, including through subsidiaries,
Affiliates or otherwise, in one or more related transactions, allow any Subject Entity individually or the Subject Entities in
the aggregate to be or become the "beneficial owner" (as defined in Rule 13d-3 under the 1934 Act), directly or indirectly,
whether through acquisition, purchase, assignment, conveyance, tender, tender offer, exchange, reduction in outstanding shares
of Common Stock, merger, consolidation, business combination, reorganization, recapitalization, spin-off, scheme of arrangement,
reorganization, recapitalization or reclassification or otherwise in any manner whatsoever, of either (x) at least 50% of the aggregate
ordinary voting power represented by issued and outstanding shares of Common Stock, (y) at least 50% of the aggregate ordinary
voting power represented by issued and outstanding shares of Common Stock not held by all such Subject Entities as of the date
of this Warrant calculated as if any Common Stock held by all such Subject Entities were not outstanding, or (z) a percentage of
the aggregate ordinary voting power represented by issued and outstanding Common Stock or other equity securities of the Company
sufficient to allow such Subject Entities to effect a statutory short form merger or other transaction requiring other shareholders
of the Company to surrender their Common Stock without approval of the shareholders of the Company or (C) directly or indirectly,
including through subsidiaries, Affiliates or otherwise, in one or more related transactions, the issuance of or the entering into
any other instrument or transaction structured in a manner to circumvent, or that circumvents, the intent of this definition in
which case this definition shall be construed and implemented in a manner otherwise than in strict conformity with the terms of
this definition to the extent necessary to correct this definition or any portion of this definition which may be defective or
inconsistent with the intended treatment of such instrument or transaction.

 

(o)"Group" means a
"group" as that term is used in Section 13(d) of the 1934 Act and as defined in Rule 13d-5 thereunder.

 

(p)"Options"
means any rights, warrants or options to subscribe for or purchase Common Stock or Convertible Securities.

 

(q)"Parent
Entity" of a Person means an entity that, directly or indirectly, controls the applicable Person, including such entity
whose common shares or common stock or equivalent equity security is quoted or listed on an Eligible Market (or, if so elected
by the Required Holders, any other market, exchange or quotation system), or, if there is more than one such Person or such entity,
the Person or such entity designated by the Required Holders or in the absence of such designation, such Person or entity with
the largest public market capitalization as of the date of consummation of the Fundamental Transaction.

 

    	 	- 18 -	 

     

    

 

(r)"Person"
means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization,
any other entity and a government or any department or agency thereof.

 

(s)"Principal
Market" means The NASDAQ Capital Market.

 

(t)"Required
Holders" means the holders of November Warrants representing at least a majority of the shares of Common Stock underlying
the November Warrants then outstanding.

 

(u)"Subject
Entity" means any Person, Persons or Group or any Affiliate or associate of any such Person, Persons or Group.

 

(v)"Successor
Entity" means one or more Person or Persons (or, if so elected by the Holder, the Company or Parent Entity) formed by,
resulting from or surviving any Fundamental Transaction or one or more Person or Persons (or, if so elected by the Holder, the
Company or the Parent Entity) with which such Fundamental Transaction shall have been entered into.

 

(w)"Trading
Day" means any day on which the Common Stock is traded on the Principal Market, or, if the Principal Market is not the
principal trading market for the Common Stock, then on the principal securities exchange or securities market on which the Common
Stock is then traded; provided that "Trading Day" shall not include any day on which the Common Stock is scheduled
to trade on such exchange or market for less than 4.5 hours or any day that the Common Stock 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 4:00:00 p.m., New York time).

 

(x)"Transaction
Document" means this Warrant and any other warrant issued by the Company to the Holder or any of the Holder's affiliates.

 

(y)"Weighted
Average Price" means, for any security as of any date, the dollar volume-weighted average price for such security on the
Principal Market during the period beginning at 9:30:01 a.m., New York time (or such other time as the Principal Market publicly
announces is the official open of trading), and ending at 4:00:00 p.m., New York time (or such other time as the Principal Market
publicly announces is the official close of trading), as reported by Bloomberg through its "Volume at Price" function
or, if the foregoing does not apply, the dollar volume-weighted average price of such security in the over-the-counter market on
the electronic bulletin board for such security during the period beginning at 9:30:01 a.m., New York time (or such other time
as such market publicly announces is the official open of trading), and ending at 4:00:00 p.m., New York time (or such other time
as such market publicly announces is the official close of trading), as reported by Bloomberg, or, if no dollar volume-weighted
average price is reported for such security by Bloomberg for such hours, the average of the highest closing bid price and the lowest
closing ask price of any of the market makers for such security as reported in the OTC Link or "pink sheets" by OTC Markets
Group Inc. (formerly Pink OTC Markets Inc.). If the Weighted Average Price cannot be calculated for a security on a particular
date on any of the foregoing bases, the Weighted Average Price of such security on such date shall be the fair market value as
mutually determined by the Company and the Holder. If the Company and the Holder are unable to agree upon the fair market value
of such security, then such dispute shall be resolved pursuant to Section 12 with the term "Weighted Average Price" being
substituted for the term "Exercise Price." All such determinations shall be appropriately adjusted for any stock dividend,
stock split, stock combination, reclassification or other similar transaction during the applicable calculation period.

 

[Signature Page Follows]

 

    	 	- 19 -	 

     

    

 

IN WITNESS WHEREOF,
the Company has caused this Warrant to Purchase Shares of Common Stock to be duly executed as of the Issuance Date set out above.

 

	 	XG TECHNOOGY, INC.	 

 

	 	By:	 	 
	 	Name:	 
	 	Title:	 

 

     

     

    

 

EXHIBIT A

 

EXERCISE NOTICE

 

TO BE EXECUTED BY THE REGISTERED HOLDER
TO EXERCISE THIS

WARRANT TO PURCHASE SHARES OF COMMON
STOCK

 

XG
TECHNOLOGY, INC. 

 

The
undersigned holder hereby exercises the right to purchase _________________ of the shares of Common Stock
("Warrant Shares") of xG Technology, Inc., a company organized under the laws of the State of Delaware
(the "Company"), evidenced by the attached Warrant to Purchase Shares of Common Stock
(the "Warrant"). Capitalized terms used herein and not otherwise defined shall have the respective meanings set
forth in the Warrant.

 

1. Form of Exercise
Price. The Holder intends that payment of the Exercise Price shall be made as:

 

____________a
"Cash Exercise" with respect to _________________ Warrant Shares; and/or

 

____________a
"Cashless Exercise" with respect to _______________ Warrant Shares.

 

2. Payment of Exercise
Price. In the event that the holder has elected a Cash Exercise with respect to some or all of the Warrant Shares to be issued
pursuant hereto, the holder shall pay the Aggregate Exercise Price in the sum of $___________________ to the Company in accordance
with the terms of the Warrant.

 

3. Delivery of Warrant
Shares. The Company shall deliver to the holder __________ Warrant Shares in accordance with the terms of the Warrant.

 

Date: _______________ __, ______

 

	 	 
	Name of Registered Holder

 

	By:	 	 
	 	Name:
	 	Title:

 

     

     

    

 

ACKNOWLEDGMENT

 

The Company hereby
acknowledges this Exercise Notice and hereby directs [Transfer Agent] to issue the above indicated number of shares of Common Stock
in accordance with the Transfer Agent Instructions dated _______________, 2015 from the Company and acknowledged and agreed to
by [Transfer Agent].

 

	 	XG TECHNOLOGY, INC.	 

 

	 	By:	 	 
	 	Name:	 
	 	Title:

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