Document:

FORBEARANCE AGREEMENT

 

 

This
Forbearance Agreement (this “Agreement”), dated as of February 7, 2013 (the “Agreement
Date”), is entered into by and among Transgenomic, Inc., a
Delaware corporation (“Borrower”), and Dogwood Pharmaceuticals, Inc. (a wholly owned subsidiary of Forest
Laboratories, Inc. (“Forest”) as successor-in-interest to PGxHealth,
LLC (“PGX”), (the “Lender”).

 

Recitals

 

Whereas, On
December 29, 2010, Borrower acquired from PGX and its affiliate Clinical Data, Inc. (“Clinical Data”) certain
assets used in connection with Clinical Data’s and PGX’s biomarker business (the “Assets”);

 

Whereas,
in partial consideration for the Assets, Borrower issued to PGX a three-year senior secured promissory note in the aggregate
principal amount of $8,639,650 (the “Note”), which Note accrues interest at the rate of 10% per year,
with the aggregate principal amount payable in equal quarterly installments commencing on June 29, 2012 and continuing thereafter
until December 29, 2013;

 

Whereas,
an aggregate of $1,388,092.50, comprised of $1,234,235.71 in principal and $153,856.78 in interest, is due and payable under the
Note by December 31, 2012 (the “Amount Owed”);

 

Whereas,
in connection with the issuance of the Note, Borrower and PGX entered into that certain Security Agreement, dated as of December
29, 2010 (the “Security Agreement”);

 

Whereas,
failure to pay the Amount Owed by December 31, 2012 would constitute an “Event of Default” under each of the Note and
the Security Agreement (collectively, the “Existing Events of Default”);

 

Whereas,
Forest acquired Clinical Data on April 13, 2011, and, as a result of such acquisition and related restructuring,
the Lender became the successor in interest to PGX with respect to the Note and the Security Agreement;

 

Whereas,
Borrower is unable to pay the Amount Owed by December 31, 2012 and has requested that the Lender forbear from exercising certain
of the Lender’s rights and remedies as a result of the Existing Events of Default; and

 

Whereas,
the Lender is willing to agree to this forbearance on the terms and conditions specified herein.

 

Agreement

 

Now,
Therefore, in consideration of the foregoing, and the respective agreements, warranties and covenants contained herein,
the parties hereto agree, covenant and warrant as follows:

 

Definitions

 

“Collateral”
shall have the meaning thereof set forth in the Security Agreement.

 

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“Event
of Default” shall mean an “Event of Default,” as defined in either of the Note or the Security Agreement.

 

“Forbearance”
shall mean the agreement of the Lender to forbear from exercising its rights and remedies under the Loan Documents or applicable
law in respect of the Existing Events of Default, including but not limited to its rights and
remedies with respect to the Collateral or against Borrower or in respect of the acceleration of Borrower’s payment obligations
in respect of the Secured Obligations, during the Forbearance Period, in all cases subject to the terms, conditions, amendments
and modifications set forth in this Agreement.

 

“Forbearance Maturity Date”
shall mean March 31, 2013.

 

“Forbearance Period”
shall mean the period commencing on the Effective Date and ending on the Forbearance Termination Date.

 

“Forbearance
Termination Date” shall mean the earliest of: (i) the Forbearance Maturity Date; (ii) the occurrence or
existence of any Event of Default under any of the Loan Documents other than the Existing Events of Default, and (iii) the
occurrence or existence of a breach by Borrower or default of any condition, covenant, term, or provision of this Agreement.

 

“Loan Documents”
shall mean, collectively and each individually, the Note, the Security Agreement and this Agreement, and any and all agreements
and documents in connection therewith, each and all as amended, modified, supplemented, extended, renewed, restated or replaced
from time to time.

 

“Secured
Obligations” shall have the meaning thereof set forth in the Security Agreement.

 

Acknowledgments

 

Acknowledgment of
Obligations. Borrower hereby acknowledges, confirms and agrees that all Secured Obligations are owing by Borrower, without
offset, defense or counterclaim of any kind, nature or description whatsoever. Borrower hereby acknowledges, confirms and agrees
that the Obligations are the aggregate amount of $6,631,734.48 as of the Agreement Date. Subject to the Forbearance provided in
Section 3.1 of this Agreement, Borrower hereby acknowledges and agrees that the Lender has the right to declare the Secured Obligations
immediately due and payable under the terms of the Loan Documents.

 

Acknowledgment of
Loan Documents. Borrower hereby acknowledges, confirms and agrees that: (a) each of the Loan Documents has been duly executed
and delivered to the Lender by Borrower, and each is in full force and effect as of the Agreement Date, (b) the agreements
and obligations of Borrower contained in the Loan Documents, including this Agreement, constitute the legal, valid and binding
obligations of Borrower, enforceable against it in accordance with their respective terms, and that Borrower does not have a valid
defense to the enforcement of the Loan Documents, including this Agreement, and (c) the Lender shall be entitled to the rights,
remedies and benefits provided for in the Loan Documents and applicable law.

 

Acknowledgment of
Defaults. Borrower hereby acknowledges, confirms and agrees that the Existing Events of Default have occurred and are continuing
and, subject to Section 3.1 of this Agreement, entitles the Lender to exercise its rights and remedies under the Note and the Security
Agreement, applicable law or otherwise, and that the Lender has not waived any such Existing Events of Default and nothing contained
in this Agreement or the transactions contemplated hereby constitute such a waiver. Borrower hereby waives the right to contest
the occurrence, existence, accuracy or materiality of the Existing Events of Default.

 

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Forbearance; No Waiver;
Reservation of Rights

 

Forbearance.

 

In reliance upon the
representations, warranties and covenants of Borrower in this Agreement, and subject to the terms and conditions of this Agreement
and any documents or instruments executed in connection herewith, the Lender agrees to the Forbearance.

 

Upon the Forbearance
Termination Date, the Forbearance and the agreement of the Lender to forbear pursuant to this Agreement shall terminate automatically
and without any further action or notice, it being expressly agreed that the effect of such termination or expiration permits the
Lender to immediately exercise any and all rights and remedies available to it, including without limitation, accelerating the
Secured Obligations (to the extent not previously accelerated), and exercising rights with respect to and foreclosing upon the
Collateral or any other collateral, subject to the terms of the Security Agreement.

 

No Waivers; Reservation
of Rights.

 

The Lender has not waived,
and by this Agreement, is not waiving, the Existing Events of Default or any other Events of Default that may exist or be continuing
on the Agreement Date or that may occur after the Agreement Date, and the Lender has not agreed to forbear with respect to any
of its rights or remedies concerning any Events of Default (other than, during the Forbearance Period, the Existing Events of Default
to the extent expressly set forth herein) that may have occurred or are continuing as of the Agreement Date or which may occur
after the Agreement Date.

 

Subject to Section 3.1
of this Agreement (solely with respect to the Existing Events of Default), the Lender reserves the right, in its discretion, to
exercise any or all of its rights and remedies under the Loan Documents as a result of any Events of Default which may be continuing
on the Agreement Date or any Event of Default that may occur after the Agreement Date, and the Lender has not waived any of such
rights or remedies, and nothing in this Agreement, and no delay on its part in exercising any such rights or remedies, should be
construed as a waiver of any such rights or remedies.

 

Agreements and Supplementary
Provisions

 

Performance. Borrower hereby agrees
to perform all Secured Obligations under the Note and the Security Agreement, subject to the terms of this Agreement.

 

Release.

 

In consideration of the
agreements of the Lender contained herein and for other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, Borrower, on behalf of itself and its successors, assigns and other legal representatives (Borrower and all
such other persons being hereinafter referred to collectively as “Releasors” and individually as a “Releasor”),
hereby absolutely, unconditionally and irrevocably releases, remises and forever discharges each of the Lender, and its successors
and assigns, and its present and former shareholders, affiliates, subsidiaries, divisions, predecessors, directors, officers, attorneys,
employees and other representatives (the Lender and all such other persons being hereinafter referred to collectively as “Releasees”
and individually as a “Releasee”), of and from all demands, actions, causes of action, suits, covenants,
contracts, controversies, agreements, promises, sums of money, accounts, bills, reckonings, damages and any and all other claims,
counterclaims, defenses, rights of set-off, demands and liabilities whatsoever (individually, a “Claim”
and collectively, “Claims”) of every name and nature, known or unknown, suspected or unsuspected, both
at law and in equity, which Releasors may now or hereafter own, hold, have or claim to have against Releasees or any of them for,
upon, or by reason of any circumstance, action, cause or thing whatsoever which arises at any time on or prior to the Effective
Date, for or on account of, or in relation to, or in any way in connection with any of the Note or the Security Agreement, or transactions
thereunder or related thereto.

 

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It is the intention of
Borrower that this Agreement and the release set forth above shall constitute a full and final accord and satisfaction of all claims
that it may have or hereafter be deemed to have against Releasees as set forth herein. In furtherance of this intention, Borrower,
on behalf of itself and each other Releasor, expressly waives any statutory or common law provision that would otherwise prevent
the release set forth above from extending to claims that are not currently known or suspected to exist in any Releasor’s
favor at the time of executing this Agreement and which, if known by Releasors, might have materially affected the agreement as
provided for hereunder. Borrower, on behalf of itself and each other Releasor, acknowledges that it is familiar with Section 1542
of California Civil Code:

 

A GENERAL RELEASE DOES NOT EXTEND TO
CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF
KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.

 

Borrower, on behalf of itself and each
other Releasor, waives and releases any rights or benefits that it may have under Section 1542 to the full extent that it
may lawfully waive such rights and benefits, and Borrower, on behalf of itself and each other Releasor, acknowledges that it understands
the significance and consequences of the waiver of the provisions of Section 1542 and that it has been advised by its attorney
as to the significance and consequences of this waiver.

 

   1.1.1       
Borrower understands, acknowledges and agrees that the release set forth above may be pleaded as a full and complete defense
and may be used as a basis for an injunction against any action, suit or other proceeding which may be instituted, prosecuted or
attempted in breach of the provisions of such release.

 

   1.1.2       
Borrower agrees that no fact, event, circumstance, evidence or transaction which could now be asserted or which may hereafter
be discovered shall affect in any manner the final, absolute and unconditional nature of the release set forth above.

 

1.2             
Covenant Not to Sue. Borrower, on behalf of itself and its successors, assigns and other legal representatives, hereby
absolutely, unconditionally and irrevocably, covenants and agrees with and in favor of each Releasee that it will not sue (at law,
in equity, in any regulatory proceeding or otherwise) any Releasee on the basis of any Claim released, remised and discharged by
Borrower pursuant to Section 4.2 above. If Borrower or any of its successors, assigns or other legal representatives violates the
foregoing covenant, Borrower, for itself and each other Releasor, agrees to pay, in addition to such other damages as any Releasee
may sustain as a result of such violation, all attorneys’ fees and costs incurred by any Releasee as a result of such violation.

 

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2.                  
 Representations and Warranties. To induce Forest and the Lender to enter into this Agreement, Borrower hereby
represents and warrants as follows:

 

2.1             Except
for the Existing Events of, after giving effect to this Agreement, Borrower is in compliance with all of the terms and provisions
set forth in the Note and the Security Agreement on its part to be observed or performed, and no Event of Default has occurred
and is continuing.

 

2.2             
Except with respect to the Existing Events of Default, each of the representations and
warranties in Section 4 of the Security Agreement shall be true and correct in all material respects on and as of the Agreement
Date, except to the extent any such representation and warranty expressly relates to an earlier date, in which case such representation
and warranty shall be true and correct in all material respects as of such earlier date.

 

2.3             
The execution, delivery and performance by Borrower of this Agreement:

 

   2.3.1       
are within its corporate power, as applicable;

 

   2.3.2       
have been duly authorized by all necessary corporate action;

 

   2.3.3       
do not and will not (A) contravene its certificate of incorporation or bylaws, (B) violate any applicable requirement
of law or any order or decree of any governmental authority or arbitrator applicable to it, (C) conflict with or result in
the breach of, or constitute a default under, or result in or permit the termination or acceleration of, any contractual obligation
of Borrower, or (D) result in the creation or imposition of any lien or encumbrance upon any of the property of Borrower;
and

 

   2.3.4       
do not and will not require the consent of, authorization by, approval of, notice to, or filing or registration with, any
governmental authority or any other person.

 

2.4             
This Agreement has been duly executed and delivered by Borrower. Each of this Agreement and the other Loan Documents constitutes
a legal, valid and binding obligation of Borrower, enforceable against Borrower in accordance with its terms, subject to the effects
of bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar laws relating to or affecting creditors’
rights generally, concepts of reasonableness, general equitable principles (whether considered in a proceeding in equity or at
law) and an implied covenant of good faith and fair dealing.

 

3.                 
  Effectiveness. Notwithstanding the Agreement Date, this
Agreement shall be deemed effective as of December 31, 2012 (the “Effective Date”).

 

4.                 
  Provisions of General Application

 

4.1             
Effect of this Agreement. Except as modified pursuant hereto, no other changes or modifications to the Note or the
Security Agreement are intended or implied and in all other respects such Loan Documents are hereby specifically ratified, restated
and confirmed by all parties hereto as of the Agreement Date. To the extent of conflict between the terms of this Agreement and
the other Loan Documents, the terms of this Agreement shall control.

 

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4.2             
Further Assurances. The parties hereto shall execute and deliver such additional documents and take such additional
reasonable action as may be necessary or desirable to effectuate the provisions and purposes of this Agreement.

 

4.3             
Successor and Assigns. This Agreement shall be binding upon and inure to the benefit of each of the parties hereto
and their respective successors and assigns.

 

4.4             
Severability. Any provision of this Agreement held by a court of competent jurisdiction to be invalid or unenforceable
shall not impair or invalidate the remainder of this Agreement.

 

4.5             
Reviewed by Attorneys. Borrower represents and warrants to Forest and the Lender that it (a) understands fully
the terms of this Agreement and the consequences of the execution and delivery of this Agreement, (b) has been afforded an
opportunity to have this Agreement reviewed by, and to discuss this Agreement and document executed in connection herewith with,
such attorneys and other persons as Borrower may wish, and (c) has entered into this Agreement and executed and delivered
all documents in connection herewith of its own free will and accord and without threat, duress or other coercion of any kind by
any person. The parties hereto acknowledge and agree that neither this Agreement nor the other documents executed pursuant hereto
shall be construed more favorably in favor of one than the other based upon which party drafted the same, it being acknowledged
that all parties hereto contributed substantially to the negotiation and preparation of this Agreement and the other documents
executed pursuant hereto or in connection herewith.

 

4.6             
Governing Law. In all respects, including all matters of construction, validity and performance, this Agreement shall
be governed by, and construed and enforced in accordance with, the laws of the State of Delaware applicable to contracts made and
performed in such state, without regard to the principles thereof regarding conflict of laws, except to the extent that the UCC
provides for the application of the law of another state.

 

4.7             
Counterparts. This Agreement may be executed in counterparts and by facsimile signatures, any one of which need not
contain the signatures of more than one party hereto and each of which shall be an original, but all such counterparts taken together
shall constitute one and the same instrument. The exchange of copies of this Agreement or amendments hereto and of signature pages
by facsimile transmission or by e-mail transmission in portable digital format (or similar format) shall constitute effective execution
and delivery of such instrument(s) as to the parties hereto and may be used in lieu of the original Agreement or amendment for
all purposes. Signatures of the parties hereto transmitted by facsimile or by e-mail transmission in portable digital format (or
similar format) shall be deemed to be their original signatures for all purposes.

 

* * * * *

 

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IN WITNESS WHEREOF,
this Agreement is executed and delivered as of the Agreement Date.

 

	Transgenomic, Inc.,	 
	as Borrower	 
	 	 
	 	 	 
	By:	/s/ Mark P Colonnese	 
	Name:	Mark P Colonnese	 
	Title:	Executive Vice President	 

 

 

 

 

	Dogwood pharmaceuticals, Inc.	 
	as Lender	 
	 	 
	 	 	 
	By:	/s/ Rita Weinberger	 
	Name:	Rita Weinberger	 
	Title:	Secretary	 

 

 

 

 

 

    	10Exhibit 4.1

 

WARRANT AGREEMENT

 

This
Warrant Agreement made as of February 8, 2013, is between Medgenics, Inc., a Delaware corporation, with offices at 555 California
Street, Suite 365, San Francisco, California 94104 (the “Company”), and Corporate
Stock Transfer, Inc., with offices at 3200 Cherry Creek Drive South, Suite 4300, Denver, Colorado 80209 (the “Warrant
Agent”). Certain capitalized terms used herein and not otherwise defined shall have the
meaning set forth in Section 10 hereof.

 

WHEREAS, the Company is engaged in a public
offering (the “Offering”) of Common Stock (as defined below) and Warrants (as defined below) and, in connection
therewith, has determined to issue and deliver 6,440,000 Series 2013-A warrants (the “Warrants”) to purchase
up to 3,220,000 shares of Common Stock (the “Warrant Shares”) to the investors in the Offering, including 840,000
Warrants to purchase up to 420,000 shares of Common Stock subject to an overallotment option granted to the underwriters as described
in the Prospectus Supplement (as defined below), each Warrant evidencing the right of the holder thereof to purchase 0.50 of a
share of the Company’s common stock, par value $.0001 per share (the “Common Stock”), for $6.78
per whole share of Common Stock, subject to adjustment as described herein;

 

WHEREAS, the Company has filed with the
Securities and Exchange Commission (the “Commission”) a shelf registration statement on Form S-3 (File No.
333-184431), as amended (the “Registration Statement”), for the registration under the Securities Act of 1933,
as amended (the “Act”), of, among other securities, the Warrants and the Common Stock issuable upon exercise
of the Warrants;

 

WHEREAS, the Company has filed with the
Commission a prospectus supplement to the Registration Statement pursuant to Rule 424(b)(5) under the Act (the “Prospectus
Supplement”) describing the terms of the Warrants and the Common Stock issuable upon exercise of the Warrants;

 

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

 

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

 

WHEREAS, all acts and things have been
done and performed which are necessary to make the Warrants, when executed on behalf of the Company and countersigned by or on
behalf of the Warrant Agent, as provided herein, the valid and legally binding obligations of the Company, and to authorize the
execution and delivery of this Warrant Agreement.

 

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

 

    	 

    	 

    

 

1.          Appointment
of Warrant Agent. The Company hereby appoints the Warrant Agent to act as agent for the Company for the Warrants, and the
Warrant Agent hereby accepts such appointment and agrees to perform the same in accordance with the terms and conditions set forth
in this Warrant Agreement.

 

2.          Warrants.

 

2.1         Form
of Warrant. Each Warrant shall be (a) issued in registered form only, (b) in substantially the form of Exhibit A attached
hereto, the provisions of which are incorporated herein, (c) signed by, or bear the facsimile signature of, the Chairman of the
Board, or the Chief Executive Officer or the President, and the Treasurer, Secretary or Assistant Secretary of the Company, and
(d) shall bear a facsimile of the Company’s seal. In the event the person whose facsimile signature has been placed upon
any Warrant shall have ceased to serve in the capacity in which such person signed the Warrant before such Warrant is issued,
it may be issued with the same effect as if he or she had not ceased to be such at the date of issuance.

 

2.2         Effect
of Countersignature. Unless and until countersigned by the Warrant Agent pursuant to this Warrant Agreement, a Warrant shall
be invalid and of no effect and may not be exercised by the holder thereof. Warrant Certificates (as defined below) shall be dated
the date of countersignature by the Warrant Agent.

 

2.3         Registration.

 

2.3.1           Warrant
Register. The Warrant Agent shall maintain books (“Warrant Register”), for the registration of original
issuance and the registration of transfer of the Warrants. Upon the initial issuance of the Warrants, the Warrant Agent shall
issue and register the Warrants in the names of the respective holders thereof in such denominations and otherwise in accordance
with instructions delivered to the Warrant Agent by the Company. The Warrants may be represented by definitive warrant certificates
in physical form (“Warrant Certificates”) or by one or more book-entry warrant certificates (“Book-Entry
Warrant Certificates”) deposited with the Depository Trust Company (the “Depository”) and registered
in the name of Cede & Co., a nominee of the Depository. Ownership of beneficial interests in the Book-Entry Warrant Certificates
shall be shown on, and the transfer of such ownership shall be effected through, records maintained (i) by the Depository or its
nominee for each Book-Entry Warrant Certificate; (ii) by institutions that have accounts with the Depository (such institution,
with respect to a Warrant in its account, a “Participant”); or (iii) directly on the book-entry records of
the Warrant Agent with respect only to owners of beneficial interests that request such direct registration.

 

If the Warrants are not “DTC Eligible”
as of the initial date of issuance of the Warrants (the “Issuance Date”) or the Depository subsequently ceases
to make its book-entry settlement system available for the Warrants, the Company may instruct the Warrant Agent regarding making
other arrangements for book-entry settlement within ten (10) days after the Depository ceases to make its book-entry settlement
available. In the event that the Company does not make alternative arrangements for book-entry settlement within ten (10) days
or the Warrants are not eligible for, or it is no longer necessary to have the Warrants available in, book-entry form, the Warrant
Agent shall provide written instructions to the Depository to deliver to the Warrant Agent for cancellation each Book-Entry Warrant
Certificate, and the Company shall instruct the Warrant Agent to deliver to the Depository definitive Warrant Certificates in
physical form evidencing such Warrants.

 

    	2

    	 

    

 

2.3.2           Beneficial
Owner; Registered Holder. The term “beneficial owner” shall mean any person in whose name ownership of a beneficial
interest in the Warrants evidenced by (a) a Book-Entry Warrant Certificate that is recorded in the records maintained by the Depository
or its nominee or (b) a definitive Warrant Certificate is recorded in the book-entry records of the Warrant Agent. Prior to due
presentment for registration of transfer of any Warrant, the Company and the Warrant Agent may deem and treat the person in whose
name such Warrant shall be registered upon the Warrant Register (the “registered holder”), as the absolute
owner of such Warrant and of each Warrant represented thereby (notwithstanding any notation of ownership or other writing on the
Warrant Certificate made by anyone other than the Company or the Warrant Agent), for the purpose of any exercise thereof, and
for all other purposes, and neither the Company nor the Warrant Agent shall be affected by any notice to the contrary.

 

2.3.3           Uncertificated
Warrants. Notwithstanding the foregoing and anything else herein to the contrary, the Warrants may be issued in uncertificated
form if so specified by the Company. 

 

3.          Terms
and Exercise of Warrants.

 

3.1           Warrant
Price. Each Warrant shall, when countersigned by the Warrant Agent, entitle the registered holder thereof, subject to the
provisions of such Warrant and of this Warrant Agreement, to purchase from the Company the number of shares of Common Stock stated
therein, at the price of $6.78 per whole share, subject to the adjustments provided in Section 4 hereof and in the last sentence
of this Section 3.1. The term “Warrant Price” as used in this Warrant Agreement refers to the price per share
at which Common Stock may be purchased at the time a Warrant is exercised. The Company, in its sole discretion, may lower the
Warrant Price at any time prior to the Expiration Date (as defined below) for a period of not less than 20 Business Days; provided,
that any such reduction shall be identical in percentage terms among all of the Warrants.

 

3.2           Duration
of Warrants. A Warrant may be exercised only during the period (“Exercise Period”) commencing on the date
of issuance and terminating at 5:00 p.m., New York City time, on the Expiration Date.  For purposes of this Warrant
Agreement, the “Expiration Date” shall mean February 13, 2018.  Each Warrant not exercised on or
before the Expiration Date shall become null and void, and all rights thereunder and all rights in respect thereof under this
Warrant Agreement shall cease at the close of business on the Expiration Date. The Company may extend the duration of the Warrants
by delaying the Expiration Date; provided, however, that the Company will provide notice to holders of the Warrants of such extension
of not less than 20 days.

 

    	3

    	 

    

 

3.3         Exercise
of Warrants.

 

3.3.1         Exercise
and Payment. A registered holder may exercise a Warrant by delivering, not later than 5:00 P.M., New York City time, on any
Business Day during the Exercise Period (the “Exercise Date”) to the Warrant Agent at its corporate trust department
(i) if all of the Warrant Shares available under the Warrant are being purchased, the Warrant Certificate evidencing the Warrants
to be exercised, or, in the case of a Book-Entry Warrant Certificate, the Warrants to be exercised (the “Book-Entry Warrants”)
shown on the records of the Depository to an account of the Warrant Agent at the Depository designated for such purpose in writing
by the Warrant Agent to the Depository from time to time and (ii) an election to purchase the Warrant Shares underlying the Warrants
to be exercised (an “Election to Purchase”), properly completed and executed by the registered holder on the
reverse of the Warrant Certificate or, in the case of a Book-Entry Warrant Certificate, properly delivered by the Participant
in accordance with the Depository’s procedures. Except as provided in Section 3.3.4, the Warrant Price for each Warrant
to be exercised shall be paid in lawful money of the United States of America by bank wire transfer in immediately available funds
on or before the Trading Day immediately after the Exercise Date. No ink-original Election to Purchase shall be required, nor
shall any medallion guarantee (or other type of guarantee or notarization) of any Election to Purchase form be required.

 

If the Election to Purchase, or the Warrant
Certificate or the Book-Entry Warrants (if required to be surrendered), is received by the Warrant Agent after 5:00 P.M., New
York City time, on the specified Exercise Date, the Warrants will be deemed to be received and exercised on the Business Day next
succeeding the Exercise Date. If the date specified as the Exercise Date is not a Business Day, the Warrants will be deemed to
be received and exercised on the next succeeding day that is a Business Day. If the Warrants are received or deemed to be received
after the Expiration Date, the exercise thereof will be null and void and any funds delivered to the Warrant Agent will be returned
to the registered holder or Participant, as the case may be, as soon as practicable. In no event will interest accrue on funds
deposited with the Warrant Agent in respect of an exercise or attempted exercise of Warrants. The validity of any exercise of
Warrants will be determined by the Company in its sole discretion and such determination will be final and binding upon the registered
holder or Participant, as applicable, and the Warrant Agent. Neither the Company nor the Warrant Agent shall have any obligation
to inform a registered holder or the Participant, as applicable, of the invalidity of any exercise of Warrants.

 

The Warrant Agent shall deposit all funds
received by it in payment of the Warrant Price in the account of the Company maintained with the Warrant Agent for such purpose
and shall advise the Company at the end of each day on which funds for the exercise of the Warrants are received of the amount
so deposited to its account. The Warrant Agent shall promptly confirm such telephonic advice to the Company in writing. 

 

    	4

    	 

    

 

Subject to Section 7.4 and notwithstanding
the foregoing, no Warrants will be exercisable unless either (a) a registration statement under the Act with respect to the Common
Stock issuable upon exercise of such Warrants is effective and a current prospectus relating to the shares of Common Stock issuable
upon exercise of the Warrants is available for delivery to the Warrant holders or (b) an exemption from the registration requirements
of the Act is available and the Company has obtained an opinion of counsel to that effect. In the event a registration statement
under the Act with respect to the Common Stock underlying the Warrants is not effective or a prospectus is not available, and
no exemption from the registration requirements of the Act is available, the registered holder shall not be entitled to exercise
such Warrants and such Warrants may have no value and expire worthless.

 

3.3.2         Delivery
of Warrant Shares. The Warrant Agent shall, within a reasonable time, advise the Company and the transfer agent and registrar
in respect of (a) the Warrant Shares issuable upon such exercise as to the number of Warrants exercised in accordance with the
terms and conditions of this Warrant Agreement, (b) the instructions of each registered holder or Participant, as the case may
be, with respect to delivery of the Warrant Shares issuable upon such exercise, and the delivery of definitive Warrant Certificates,
as appropriate, evidencing the balance, if any, of the Warrants remaining after such exercise, (c) in case of a Book-Entry Warrant
Certificate, the notation that shall be made to the records maintained by the Depository, its nominee for each Book-Entry Warrant
Certificate, or a Participant, as appropriate, evidencing the balance, if any, of the Warrants remaining after such exercise and
(d) such other information as the Company or such transfer agent and registrar shall reasonably require.

 

Provided that the Warrant Agent has received
funds in the amount of the Warrant Price, the Company shall, by 5:00 P.M., New York City time, on or before the third Trading
Day next succeeding the Exercise Date of any Warrant (the “Warrant Shares Delivery Date”), execute, issue and
deliver to the Warrant Agent, the Warrant Shares to which such registered holder or Participant, as the case may be, is entitled,
in fully registered form, registered in such name or names as may be directed by such registered holder or the Participant, as
the case may be. Upon receipt of such Warrant Shares, the Warrant Agent shall, by 5:00 P.M., New York City time, on the third
Trading Day next succeeding such Exercise Date, transmit such Warrant Shares to or upon the order of the registered holder or
Participant, as the case may be.

 

In lieu of delivering physical certificates
representing the Warrant Shares issuable upon exercise, provided the Company’s transfer agent is participating in the Depository’s
Fast Automated Securities Transfer program, the Company shall use its reasonable best efforts to cause its transfer agent to electronically
transmit the Warrant Shares issuable upon exercise to the Depository by crediting the account of the registered holder’s
prime broker with the Depository or of the Participant, as the case may be, through its Deposit Withdrawal Agent Commission system.
The time periods for delivery described in the immediately preceding paragraph shall apply to the electronic transmittals described
herein.

 

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3.3.3       Company’s
Failure to Timely Deliver Securities. If the Warrant Shares are not delivered pursuant to the provisions of Section 3.3.2
on or prior to the Warrant Shares Delivery Date, and if after such date the registered holder is required by its broker to purchase
(in an open market transaction or otherwise) or the registered holder’s brokerage firm otherwise purchases, shares of Common
Stock to deliver in satisfaction of a sale by the registered holder of the Warrant Shares which the registered holder anticipated
receiving upon exercise of the Warrant (a “Buy-In”), then the Company shall (A) pay in cash to the registered
holder the amount by which (x) the registered holder’s total purchase price (including brokerage commissions, if any) for
the shares of Common Stock so purchased exceeds (y) the amount obtained by multiplying (1) the number of Warrant Shares that the
Company was required to deliver to the registered holder in connection with the exercise at issue times (2) the price at which
the sell order giving rise to such purchase obligation was executed, and (B) at the option of the registered holder given by written
notice to the Company and the Warrant Agent, either reinstate the portion of the Warrant and equivalent number of Warrant Shares
for which such exercise was not honored or deliver to the registered holder the number of shares of Common Stock that would have
been issued had the Company timely complied with its exercise and delivery obligations hereunder. The registered holder shall
provide the Company and the Warrant Agent with written notice of the cash amounts referred to in the preceding sentence and, upon
request of the Company, evidence thereof.

 

3.3.4      Cashless
Exercise Under Certain Circumstances.

 

(i)          The
Company shall provide to the registered holders of the Warrants prompt written notice of any time that the Company is unable to
issue the Warrant Shares via DTC transfer or otherwise (without restrictive legend), because (A) the Commission has issued a stop
order with respect to the Registration Statement or any other registration statement registering the issuance of the Warrant Shares,
(B) the Commission otherwise has suspended or withdrawn the effectiveness of the Registration Statement, either temporarily or
permanently, and no other registration statement registering the issuance of the Warrant Shares is then effective, (C) the Company
has suspended or withdrawn the effectiveness of the Registration Statement, either temporarily or permanently, and no other registration
statement registering the issuance of the Warrant Shares is then effective, or (D) otherwise (each a “Registration Failure
Event”). To the extent that a Registration Failure Event occurs after the registered holder has exercised a Warrant
in accordance with the terms of the Warrants but prior to the delivery of the Warrant Shares, the Company shall, at the election
of the registered holder to be given within five (5) days of receipt of notice of the Registration Failure Event, either (A) rescind
the previously submitted Election to Purchase and the Company shall return all consideration paid by the registered holder for
such shares upon such rescission or (B) if then permitted pursuant to the terms hereof, treat the attempted exercise as a cashless
exercise as described in the next paragraph and refund the cash portion of the exercise price to the registered holder.

 

(ii)         If
(A) a Registration Failure Event has occurred and is continuing and no exemption from the registration requirements is available
for the cash exercise of the Warrant and (B) an exemption from the registration requirements of the Act permitting cashless
exercise of the Warrant and the public resale of the Warrant Shares on the Exercise Date is available and the Company has obtained
an opinion of counsel to that effect, the Warrant shall only be exercisable on a cashless basis. Notwithstanding
anything herein to the contrary, the Company shall not be required to make any cash payments or net cash settlement to the registered
holder in lieu of issuance of the Warrant Shares. Upon a “cashless exercise”, the registered holder shall be entitled
to receive a certificate (or book entry) for the number of Warrant Shares equal to the quotient obtained by dividing [(A-B) (X)]
by (A), where:

 

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(A) = the VWAP on the Trading Day immediately
preceding the date on which the registered holder elects to exercise the Warrant by means of a “cashless exercise,”
as set forth in the applicable Election to Purchase;

 

(B) = the Warrant Price of the Warrant,
as it may have been adjusted hereunder; and

 

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

 

Upon receipt of an Election to Purchase
for a cashless exercise, the Warrant Agent will promptly deliver a copy of the Election to Purchase to the Company to confirm
the number of Warrant Shares issuable in connection with the cashless exercise. The Company shall calculate and transmit to the
Warrant Agent, and the Warrant Agent shall have no obligation under this section to calculate, the number of Warrant Shares issuable
in connection with the cashless exercise.

 

3.3.5     Liquidated
Damages.

 

(i)          If
a Registration Failure Event has occurred and is continuing and no exemption from the registration requirements of the Act is
available to permit the exercise of the Warrants, the Company shall pay on a monthly basis to each holder of Warrants then outstanding
an amount in cash, as liquidated damages and not as a penalty, equal to 1.0% of the aggregate exercise price of the Warrants then
outstanding and held by such holder. Such payment shall be due in respect of any month in which, as of the end of such month,
a Registration Failure Event is continuing and no exemption from the registration requirements of the Act is then available for
the exercise of the Warrants. Any such monthly payment shall be due no later than the tenth day of the following month. Notwithstanding
anything herein to the contrary, in no event shall the aggregate amount of such monthly payments to any holder (or transferee
of such holder) exceed 10.0% of the aggregate purchase price paid by such holder for the purchase of Common Stock and Warrants
in the Offering.

 

(ii)         If
the Company fails for any reason to deliver the Warrant Shares to a holder subject to an Election of Purchase by the second Trading
Day following the Warrant Shares Delivery Date, the Company shall pay to such holder, in cash, as liquidated damages and not as
a penalty, for each $1,000 of Warrant Shares subject to such exercise (based on the VWAP of the Common Stock on the date of the
applicable Election to Purchase), $20 per Trading Day for each Trading Day after such Warrant Shares Delivery Date until such
Warrant Shares are delivered or such holder rescinds such exercise. Any such payment shall be due no
later than the tenth day of the end of the month such payments accrued. Notwithstanding anything herein to the contrary, in no
event shall the aggregate amount of payments to any holder (or transferee of such holder) exceed 10.0% of the aggregate purchase
price paid by such holder for the purchase of Common Stock and Warrants in the Offering.

 

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3.3.6         Disputes.
In the case of a dispute as to the determination of the Warrant Price or the arithmetic calculation of the number of Warrant Shares
to be issued pursuant to the terms hereof, the Company shall promptly issue to the registered holder the number of Warrant Shares
that are not disputed and resolve such dispute in accordance with Section 9.10.

 

3.3.7         Limitations
on Exercises. Neither the Warrant Agent nor the Company shall effect any exercise of any Warrant, and a registered holder
shall not have the right to exercise any portion of a Warrant, to the extent that after giving effect to such issuance after exercise
as set forth on the applicable Election to Purchase, the registered holder (together with such registered holder’s Affiliates
(as defined in Rule 405 under the Act), and any other persons acting as a group together with the registered holder or any of
such registered holder’s Affiliates), would beneficially own in excess of the Beneficial Ownership Limitation (as defined
below). For purposes of the foregoing sentence, the number of shares of Common Stock beneficially owned by the registered holder
and its Affiliates shall include the number of shares of Common Stock issuable upon exercise of the Warrant with respect to which
such determination is being made, but shall exclude the number of shares of Common Stock which would be issuable upon (i) exercise
of the remaining, nonexercised portion of any Warrant beneficially owned by the registered holder or any of its Affiliates and
(ii) exercise or conversion of the unexercised or nonconverted portion of any other securities of the Company (including, without
limitation, any other common stock equivalents) subject to a limitation on conversion or exercise analogous to the limitation
contained herein beneficially owned by the registered holder or any of its Affiliates. Except as set forth in the preceding sentence,
for purposes of this Section 3.3.7, beneficial ownership shall be calculated in accordance with Section 13(d) of the Securities
Exchange Act of 1934 (the “Exchange Act”) and the rules and regulations promulgated thereunder, it being acknowledged
that neither the Warrant Agent nor the Company is representing that such calculation is in compliance with Section 13(d) of the
Exchange Act and the registered holder is solely responsible for any schedules required to be filed in accordance therewith. To
the extent that the limitation contained in this Section 3.3.7 applies, the determination of whether any Warrant is exercisable
(in relation to other securities owned by the registered holder together with any Affiliates) and of which portion of any Warrant
is exercisable shall be in the sole discretion of the registered holder, and the submission of an Election to Purchase shall be
deemed to be the registered holder’s determination of whether such Warrant is exercisable (in relation to other securities
owned by the registered holder together with any Affiliates) and of which portion of such Warrant is exercisable, in each case
subject to the Beneficial Ownership Limitation, and neither the Warrant Agent nor the Company shall have any obligation to verify
or confirm the accuracy of such determination and neither of them shall have any liability for exercises of any Warrant that are
not in compliance with the Beneficial Ownership Limitation. In addition, a determination as to any group status as contemplated
above shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder,
and neither the Warrant Agent nor the Company shall have any obligation to verify or confirm the accuracy of such determination
and shall have no liability for exercises of any Warrant that are not in compliance with the Beneficial Ownership Limitation.
For purposes of this Section 3.3.7, in determining the number of outstanding shares of Common Stock, a registered holder may rely
on the number of outstanding shares of Common Stock as reflected in (A) the Company’s most recent periodic or annual report
filed with the Commission, as the case may be, (B) a more recent public announcement by the Company or (C) a more recent written
notice by the Company or the transfer agent for the Common Stock setting forth the number of shares of Common Stock 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 any Warrant, by the registered holder or its Affiliates since the date as of which such
number of outstanding shares of Common Stock was reported. The “Beneficial Ownership Limitation” shall be 4.9%
of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock
issuable upon exercise of such Warrant. The registered holder, upon not less than 61 days’ prior notice to the Company,
may increase or decrease the Beneficial Ownership Limitation provisions of this Section 3.3.7, provided that the Beneficial Ownership
Limitation in no event exceeds 9.9% of the number of shares of the Common Stock outstanding immediately after giving effect to
the issuance of shares of Common Stock upon exercise of such Warrant held by the registered holder and the provisions of this
Section 3.3.7 shall continue to apply. Any such increase or decrease will not be effective until the 61st day after such notice
is delivered to the Company. The provisions of this paragraph shall be construed and implemented in a manner otherwise than in
strict conformity with the terms of this Section 3.3.7 to correct this paragraph (or any portion hereof) which may be defective
or inconsistent with the intended Beneficial Ownership Limitation herein contained or to make changes or supplements necessary
or desirable to properly give effect to such limitation. The limitations contained in this paragraph shall apply to a successor
registered holder of any Warrant.

 

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3.3.8         Valid
Issuance. All shares of Common Stock issued upon the proper exercise of a Warrant in conformity with this Warrant Agreement
shall be validly issued, fully paid and nonassessable.

 

3.3.9.        No
Fractional Exercise. No fractional Warrant Shares shall be issued upon the exercise of any Warrant. As to any fraction of
a Warrant Share which the registered holder would otherwise be entitled to purchase upon such exercise, the Company shall, at
its election, either pay a cash adjustment in respect of such fraction in an amount equal to such fraction multiplied by the Warrant
Price or round up such fraction to the nearest whole share. If fewer than all of the Warrants evidenced by a Warrant Certificate
are exercised, a new Warrant Certificate for the number of unexercised Warrants remaining shall be executed by the Company and
countersigned by the Warrant Agent as provided in Section 2 of this Warrant Agreement, and delivered to the registered holder
at the address specified on the books of the Warrant Agent or as otherwise specified by such registered holder. If fewer than
all of the Warrants evidenced by a Book-Entry Warrant Certificate are exercised, a notation shall be made to the records maintained
by the Depository, its nominee for each Book-Entry Warrant Certificate, or a Participant, as appropriate, evidencing the balance
of the Warrants remaining after such exercise.

 

3.3.10       Date
of Issuance. Each person or entity in whose name any such certificate for shares of Common Stock is issued shall, for all
purposes, be deemed to have become the holder of record of such shares on the date on which the Warrant was surrendered and payment
of the Warrant Price was made, irrespective of the date of delivery of such certificate, except that, if the date of such surrender
and payment is a date when the stock transfer books of the Company are closed, such person shall be deemed to have become the
holder of such shares at the close of business on the next succeeding date on which the stock transfer books are open.

 

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4.           Adjustments.

 

4.1           Stock
Dividends - Split-Ups. If, after the Issuance Date, and subject to the provisions of Section 4.5 below, the number of outstanding
shares of Common Stock is increased by a stock dividend payable in shares of Common Stock, or by a split-up of shares of Common
Stock, or other similar event, then, on the effective date of such stock dividend, split-up or similar event, the number of shares
of Common Stock issuable on exercise of each Warrant shall be increased in proportion to such increase in outstanding shares of
Common Stock.

 

4.2           Aggregation
of Shares. If, after the Issuance Date, and subject to the provisions of Section 4.5, the number of outstanding shares of
Common Stock is decreased by a consolidation, combination, reverse stock split or reclassification of shares of Common Stock or
other similar event, then, on the effective date of such consolidation, combination, reverse stock split, reclassification or
similar event, the number of shares of Common Stock issuable on exercise of each Warrant shall be decreased in proportion to such
decrease in outstanding shares of Common Stock.

 

4.3           Adjustments
in Warrant Price. Whenever the number of shares of Common Stock purchasable upon the exercise of the Warrants is adjusted,
as provided in Sections 4.1 and 4.2 above, the Warrant Price shall be adjusted (to the nearest cent) by multiplying such Warrant
Price, immediately prior to such adjustment, by a fraction, (a) the numerator of which shall be the number of shares of Common
Stock purchasable upon the exercise of the Warrants immediately prior to such adjustment, and (b) the denominator of which shall
be the number of shares of Common Stock so purchasable immediately thereafter.

 

4.4           Extraordinary
Dividends. If the Company, at any time during the Exercise Period, shall pay a dividend in cash, securities or other assets
to the holders of Common Stock (or other shares of the Company’s capital stock into which the Warrants are convertible),
other than (i) as described in Sections 4.1, 4.2 or 4.5 or (ii) regular quarterly or other periodic dividends (any such non-excluded
event being referred to herein as an “Extraordinary Dividend”), then the Warrant Price shall be decreased,
effective immediately after the effective date of such Extraordinary Dividend, by the amount of cash and/or the fair market value
(as determined by the Company’s Board of Directors, in good faith) of any securities or other assets paid on each share
of Common Stock in respect of such Extraordinary Dividend.

 

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4.5           Fundamental
Transactions. If, at any time while the Warrants are outstanding, (i) the Company, directly or indirectly, in one or more
related transactions effects any merger or consolidation of the Company with or into another Person in which the Company is not
the surviving entity or the stockholders of the Company immediately prior to such merger or consolidation do not own, directly
or indirectly, at least 50% of the outstanding voting securities of the surviving entity, (ii) the Company, directly or indirectly,
effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of its assets
in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange offer (whether
by the Company or another Person) is completed pursuant to which all or substantially all of the holders of Common Stock are permitted
to sell, tender or exchange their shares for other securities, cash or property and has been accepted by the holders of 50% or
more of the outstanding Common Stock, or (iv) the Company, directly or indirectly, in one or more related transactions effects
any reclassification, reorganization or recapitalization of the Common Stock or any compulsory share exchange pursuant to which
the Common Stock is effectively converted into or exchanged for other securities, cash or property (other than as a result of
a subdivision or combination of shares of Common Stock covered by Section 4.1 or 4.2 above) (each a “Fundamental Transaction”),
then, upon any subsequent exercise of a Warrant, the registered holder shall have the right to receive, for each Warrant Share
that would have been issuable upon such exercise immediately prior to the occurrence of such Fundamental Transaction, at the option
of such registered holder (without regard to any limitation in Section 3.3.7 on the exercise of the Warrant), the number of shares
of Common Stock of the successor or acquiring corporation or of the Company, if it is the surviving corporation, and any additional
consideration (the “Alternate Consideration”) receivable as a result of such Fundamental Transaction by a holder
of the number of shares of Common Stock for which the Warrant is exercisable immediately prior to such Fundamental Transaction
(without regard to any limitation in Section 3.3.7 on the exercise of the Warrant). For purposes of any such exercise, the determination
of the Warrant Price shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate
Consideration issuable in respect of one share of Common Stock in such Fundamental Transaction, and the Company shall apportion
the Warrant Price among the Alternate Consideration in a reasonable manner reflecting the relative value of any different components
of the Alternate Consideration. If holders of Common Stock are given any choice as to the securities, cash or property to be received
in a Fundamental Transaction, then the registered holder shall be given the same choice as to the Alternate Consideration it receives
upon any exercise of its Warrant following such Fundamental Transaction. Notwithstanding the foregoing, in the event of a Fundamental
Transaction in which the amount of the Alternate Consideration is less than the Warrant Price, at the request of the registered
holder delivered before the 90th day after the consummation of such Fundamental Transaction, the Company (or the Successor Entity,
as defined below) shall purchase the Warrants from such registered holder by paying to such registered holder, within five Business
Days after such request (or, if later, on the effective date of the Fundamental Transaction), cash in an amount equal to the Black
Scholes Value of the remaining unexercised portion of such registered holder’s Warrants on the date of such Fundamental
Transaction. As used herein, (1) “Black Scholes Value” means the value of the Warrant based on the Black and
Scholes Option Pricing Model obtained from the “OV” function on Bloomberg, L.P. (“Bloomberg”) determined
as of the day of consummation of the applicable Fundamental Transaction for pricing purposes and reflecting (A) a risk-free interest
rate corresponding to the U.S. Treasury rate for a period equal to the time between the date of the public announcement of the
applicable Fundamental Transaction and the Expiration Date, (B) an expected volatility equal to the greater of 100% and the 100
day volatility obtained from the HVT function on Bloomberg as of the Trading Day immediately following the public announcement
of the applicable Fundamental Transaction, (C) the underlying price per share used in such calculation shall be the sum of the
price per share being offered in cash, if any, plus the value of any non-cash consideration, if any, being offered in such Fundamental
Transaction and (D) a remaining option time equal to the time between the date of the public announcement of the applicable Fundamental
Transaction and the Expiration Date, (2) “Successor Entity” means the Person (as defined below) (or, if so
elected by the registered holder, the Parent Entity (as defined below)) formed by, resulting from or surviving any Fundamental
Transaction or the Person (or, if so elected by the registered holder, the Parent Entity) with which such Fundamental Transaction
shall have been entered into, (3) “Eligible Market” means the NYSE MKT, The NASDAQ Capital Market, The NASDAQ
Global Market, The NASDAQ Global Select Market, the New York Stock Exchange or the OTC Bulletin Board (or any successors to any
of the foregoing), (4) “Parent Entity” of a Person means an entity that, directly or indirectly, controls the
applicable Person and whose common stock or equivalent equity security is quoted or listed on an Eligible Market, or, if there
is more than one such Person or Parent Entity, the Person or Parent Entity with the largest public market capitalization as of
the date of consummation of the Fundamental Transaction, and (5) “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. The terms of any agreement pursuant to which a Fundamental Transaction is effected shall
include terms insuring that the Warrants (or any such replacement security) will be similarly adjusted upon any subsequent transaction
analogous to a Fundamental Transaction.

 

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4.6           Notices
of Changes in Warrant. Upon every adjustment of the Warrant Price or the number of shares issuable upon exercise of a Warrant,
the Company shall give written notice thereof to the Warrant Agent, which notice shall state the Warrant Price resulting from
such adjustment and the increase or decrease, if any, in the number of shares purchasable at such price upon the exercise of a
Warrant, setting forth in reasonable detail the method of calculation and the facts upon which such calculation is based. Upon
the occurrence of any event specified in Sections 4.1, 4.2, 4.4 or 4.5, the Company shall give written notice to each registered
holder, at the last address set forth for such registered holder in the Warrant Register, of the record date or the effective
date of the event. Failure to give such notice, or any defect therein, shall not affect the legality or validity of such event.

 

4.7           Form
of Warrant. The form of Warrant need not be changed because of any adjustment pursuant to this Section 4, and Warrants issued
after such adjustment may state the same Warrant Price and the same number of shares as is stated in the Warrants initially issued
pursuant to this Warrant Agreement. However, the Company may, at any time, in its sole discretion, make any change in the form
of Warrant that the Company may deem appropriate and that does not affect the substance thereof, and any Warrant thereafter issued
or countersigned, whether in exchange or substitution for an outstanding Warrant or otherwise, may be in the form as so changed.

 

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4.8           Notice
of Certain Transactions.  In the event that the Company shall propose to (a) offer the holders of its Common Stock
rights to subscribe for or to purchase any securities convertible into shares of Common Stock or shares of stock of any class
or any other securities, rights or options, (b) issue any rights, options or warrants entitling the holders of Common Stock to
subscribe for shares of Common Stock or (c) make a tender offer, redemption offer or exchange offer with respect to the Common
Stock, the Company shall send to the registered holders a notice of such proposed action or offer. Such notice shall be mailed
to the registered holders at their addresses as they appear in the Warrant Register, which shall specify the record date for the
purposes of such dividend, distribution or rights, or the date such issuance or event is to take place and the date of participation
therein by the holders of Common Stock, if any such date is to be fixed, and shall briefly indicate the effect of such action
on the Common Stock and on the number and kind of any other shares of stock and on other property, if any, and the number of shares
of Common Stock and other property, if any, issuable upon exercise of each Warrant and the Warrant Price after giving effect to
any adjustment pursuant to this Article 4 which would be required as a result of such action. Such notice shall be given as promptly
as practicable after the Board has determined to take any such action and (x) in the case of any action covered by clause (a)
or (b) above, at least 10 days prior to the record date for determining the holders of the Common Stock for purposes of such action
or (y) in the case of any other such action, at least 20 days prior to the date of the taking of such proposed action or the date
of participation therein by the holders of Common Stock, whichever shall be the earlier.

 

4.9           Other
Events.  If any event occurs as to which the foregoing provisions of this Article 4 are not strictly applicable
or, if strictly applicable, would not, in the good faith judgment of the Board, fairly and adequately protect the purchase rights
of the registered holders of the Warrants in accordance with the essential intent and principles of such provisions, then the
Board shall make such adjustments in the application of such provisions, in accordance with such essential intent and principles,
as shall be reasonably necessary, in the good faith opinion of the Board, to protect such purchase rights as aforesaid.

 

5.          Transfer
and Exchange of Warrants.

 

5.1           Registration
of Transfer. The Warrant Agent shall register the transfer, from time to time, of any outstanding Warrant into the Warrant
Register, upon surrender of such Warrant for transfer, and accompanied by appropriate instructions for transfer. Upon any such
transfer, a new Warrant representing an equal aggregate number of Warrants shall be issued and the old Warrant shall be cancelled
by the Warrant Agent. The Warrants so cancelled shall be delivered by the Warrant Agent to the Company from time to time upon
request.

 

5.2           Procedure
for Surrender of Warrants. Warrants may be surrendered to the Warrant Agent, together with a written request for exchange
or transfer reasonably acceptable to Warrant Agent, duly executed by the registered holder thereof, or by a duly authorized attorney,
and thereupon the Warrant Agent shall issue in exchange therefor one or more new Warrants as requested by the registered holder
of the Warrants so surrendered, representing an equal aggregate number of Warrants; provided, however, that except
as otherwise provided herein or in any Book-Entry Warrant Certificate, each Book-Entry Warrant Certificate may be transferred
only in whole and only to the Depository, to another nominee of the Depository, to a successor depository, or to a nominee of
a successor depository; provided further, that in the event that a Warrant surrendered for transfer bears a restrictive
legend, the Warrant Agent shall not cancel such Warrant and issue new Warrants in exchange therefor until the Warrant Agent has
received an opinion of counsel for the Company stating that such transfer may be made and indicating whether the new Warrants
must also bear a restrictive legend. Upon any such registration of transfer, the Company shall execute, and the Warrant Agent
shall countersign and deliver, in the name of the designated transferee a new Warrant Certificate or Warrant Certificates of any
authorized denomination evidencing in the aggregate a like number of unexercised Warrants.

 

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5.3           Fractional
Warrants. The Warrant Agent shall not be required to effect any registration of transfer or exchange which will result in
the issuance of a Warrant Certificate for a fraction of a Warrant.

 

5.4           Service
Charges. No service charge shall be made for any exchange or registration of transfer of Warrants.

 

5.5           Warrant
Execution and Countersignature. The Warrant Agent is hereby authorized to countersign and to deliver, in accordance with the
terms of this Warrant Agreement, the Warrants required to be issued pursuant to the provisions of this Section 5, and the Company,
whenever required by the Warrant Agent, will supply the Warrant Agent with Warrants duly executed on behalf of the Company for
such purpose.

 

6.           Reserved.

 

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

 

7.1           No
Rights as Stockholder. Except as otherwise specifically provided herein, a registered holder, solely in its capacity as a
holder of a 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 Agreement be construed to confer upon a registered holder, solely
in its capacity as the registered holder of a Warrant, any of the rights of a stockholder of the Company or any right to vote,
give or withhold consent to any corporate action (whether any reorganization, issue of stock, reclassification of stock, consolidation,
merger, conveyance or otherwise), receive notice of meetings, receive dividends or subscription rights, or otherwise, prior to
the issuance to the registered holder of the Warrant Shares which it is then entitled to receive upon the due exercise of a Warrant.
A Warrant does not entitle the registered holder thereof to any of the rights of a stockholder.

 

7.2           Lost,
Stolen Mutilated or Destroyed Warrants. If any Warrant is lost, stolen, mutilated or destroyed, the Company and the Warrant
Agent may, on such terms as to indemnity or otherwise as they may in their discretion impose (which terms shall, in the case of
a mutilated Warrant, include the surrender thereof), issue a new Warrant of like denomination, tenor and date as the Warrant so
lost, stolen, mutilated or destroyed. Any such new Warrant shall constitute a substitute contractual obligation of the Company,
whether or not the allegedly lost, stolen, mutilated or destroyed Warrant shall be at any time enforceable by anyone.

 

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

 

7.4           Registration
of Common Stock. The Company will use its reasonable best efforts to maintain the effectiveness of the Registration Statement,
or a new registration statement, for the registration under the Act of the Common Stock issuable upon exercise of the Warrants
and ensure that a prospectus is available for delivery to the Warrant holders until the expiration of the Warrants in accordance
with the provisions of this Warrant Agreement.

 

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7.5           Noncircumvention.
The Company hereby covenants and agrees that the Company will not, by amendment of its corporate charter, 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 the Warrants or this Warrant
Agreement, and will at all times in good faith carry out all the provisions of the Warrants and this Warrant Agreement. Without
limiting the generality of the foregoing, the Company (i) shall not increase the par value of any shares of Common Stock receivable
upon the exercise of the Warrants above the Warrant 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 shares of Common Stock upon
the exercise of the Warrants, and (iii) shall, so long as the 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 Warrants, 100% of the number of shares of Common Stock issuable upon exercise of the Warrants then outstanding (without regard
to any limitations on exercise). 

 

8.          Concerning
the Warrant Agent and Other Matters.

 

8.1         Payment
of Taxes. The Company will, from time to time, promptly pay all taxes and charges that may be imposed upon the Company or
the Warrant Agent in respect of the issuance or delivery of shares of Common Stock upon the exercise of Warrants, but the Company
shall not be obligated to pay any transfer taxes in respect of the Warrants or such shares. The Warrant Agent shall not register
any transfer or issue or deliver any Warrant Certificate(s) or Warrant Shares unless or until the persons requesting the registration
or issuance shall have paid to the Warrant Agent for the account of the Company the amount of such tax, if any, or shall have
established to the reasonable satisfaction of the Company that such tax, if any, has been paid.

 

8.2         Resignation,
Consolidation, or Merger of Warrant Agent.

 

8.2.1           Appointment
of Successor Warrant Agent. The Warrant Agent, or any successor to it hereafter appointed, may resign its duties and be discharged
from all further duties and liabilities hereunder after giving sixty (60) days’ notice in writing to the Company. If the
office of the Warrant Agent becomes vacant by resignation or incapacity to act or otherwise, the Company shall appoint, in writing,
a successor Warrant Agent in place of the Warrant Agent. If the Company shall fail to make such appointment within a period of
30 days after it has been notified in writing of such resignation or incapacity by the Warrant Agent or by the holder of any Warrant
(who shall, with such notice, submit his, her or its Warrant for inspection by the Company), then such holder may apply to the
Supreme Court of the State of New York for the County of New York for the appointment of a successor Warrant Agent. Any successor
Warrant Agent, whether appointed by the Company or by such court, shall be authorized under applicable laws to exercise corporate
trust powers and subject to supervision or examination by federal or state authorities. After appointment, any successor Warrant
Agent shall be vested with all the authority, powers, rights, immunities, duties and obligations of its predecessor Warrant Agent
with like effect as if originally named as Warrant Agent hereunder, without any further act or deed; but, if for any reason it
becomes necessary or appropriate, the predecessor Warrant Agent shall execute and deliver, at the expense of the Company, an instrument
transferring to such successor Warrant Agent all the authority, powers, and rights of such predecessor Warrant Agent hereunder;
and, upon request of any successor Warrant Agent, the Company shall make, execute, acknowledge, and deliver any and all instruments
in writing for more fully and effectually vesting in and confirming to such successor Warrant Agent all such authority, powers,
rights, immunities, duties and obligations.

 

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

 

8.2.3           Merger
or Consolidation of Warrant Agent. Any corporation into which the Warrant Agent may be merged or with which it may be consolidated
or any corporation resulting from any merger or consolidation to which the Warrant Agent shall be a party shall be the successor
Warrant Agent under this Warrant Agreement without any further act on the part of the Company or the Warrant Agent.

 

8.3         Fees
and Expenses of Warrant Agent.

 

8.3.1           Remuneration.
The Company agrees to pay the Warrant Agent reasonable remuneration in an amount separately agreed to between the Company and
the Warrant Agent for its services as Warrant Agent hereunder and will reimburse the Warrant Agent upon demand for
all expenditures that the Warrant Agent may reasonably incur in the execution of its duties hereunder.

 

8.3.2           Further
Assurances. The Company agrees to perform, execute, acknowledge and deliver, or cause to be performed, executed, acknowledged
and delivered, all such further and other acts, instruments and assurances as may reasonably be required by the Warrant Agent
for the carrying out or performing of the provisions of this Warrant Agreement.

 

8.4         Liability
of Warrant Agent.

 

8.4.1           Reliance
on Company Statement. Whenever, in the performance of its duties under this Warrant Agreement, the Warrant Agent shall deem
it necessary or desirable that any fact or matter be proved or established by the Company prior to taking or suffering any action
hereunder, such fact or matter (unless other evidence in respect thereof be herein specifically prescribed) may be deemed to be
conclusively proved and established by a statement signed by the Chief Executive Officer, Chief Financial Officer or Chairman
of the Board of the Company and delivered to the Warrant Agent. The Warrant Agent may rely upon such statement for any action
taken or suffered in good faith by it pursuant to the provisions of this Warrant Agreement.

 

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8.4.2           Indemnity.
The Warrant Agent shall be liable hereunder only for its own negligence, willful misconduct or bad faith. The Company agrees to
indemnify the Warrant Agent and save it harmless against any and all liabilities, including judgments, costs and reasonable counsel
fees, for anything done or omitted by the Warrant Agent in the execution of this Warrant Agreement, except as a result of the
Warrant Agent’s negligence, willful misconduct or bad faith.

 

8.4.3           Exclusions.
The Warrant Agent shall have no responsibility with respect to the validity of this Warrant Agreement or with respect to the validity
or execution of any Warrant (except its countersignature hereof and thereof); nor shall it be responsible for any breach by the
Company of any covenant or condition contained in this Warrant Agreement or in any Warrant; nor shall it be responsible to make
any adjustments required under the provisions of Section 4 hereof or responsible for the manner, method or amount of any such
adjustment or the ascertaining of the existence of facts that would require any such adjustment; nor shall it, by any act hereunder,
be deemed to make any representation or warranty as to the authorization or reservation of any shares of Common Stock to be issued
pursuant to this Warrant Agreement or any Warrant or as to whether any shares of Common Stock will when issued be valid and fully
paid and nonassessable.

 

8.5         Acceptance
of Agency. The Warrant Agent hereby accepts the agency established by this Warrant Agreement and agrees to perform the same
upon the terms and conditions herein set forth and, among other things, shall account promptly to the Company with respect to
Warrants exercised and concurrently account for, and pay to the Company, all moneys received by the Warrant Agent for the purchase
of shares of the Company’s Common Stock through the exercise of Warrants.

 

9.           Miscellaneous
Provisions.

 

9.1           Successors.
All the covenants and provisions of this Warrant Agreement by or for the benefit of the Company or the Warrant Agent shall bind
and inure to the benefit of their respective successors and assigns.

 

9.2           Notices.
Any notice, statement or demand authorized by this Warrant Agreement to be given or made by the Warrant Agent or by the holder
of any Warrant to or on the Company shall be delivered by hand or sent by registered or certified mail or overnight courier service,
addressed (until another address is filed in writing by the Company with the Warrant Agent) as follows:

 

Medgenics, Inc.

555 California Street, Suite 365

San Francisco, California 94104

Attn: Andrew L. Pearlman,
Chief Executive Officer

 

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Any notice, statement or demand authorized by this Warrant
Agreement to be given or made by the holder of any Warrant or by the Company to or on the Warrant Agent shall be delivered by
hand or sent by registered or certified mail or overnight courier service, addressed (until another address is filed in writing
by the Warrant Agent with the Company), as follows:

 

Corporate Stock Transfer, Inc.

3200 Cherry Creek Drive South

Suite 430

Denver, Colorado 80209

Attn: Carylyn Bell

 

With a copy in each case to (which shall not constitute notice):

 

Maxim Group LLC

405 Lexington Avenue

New York, New York 10174

Attn: Equity Capital Markets

 

Any notice, sent pursuant to this Warrant Agreement shall be
effective, if delivered by hand, upon receipt thereof by the party to whom it is addressed, if sent by overnight courier, on the
next Business Day of the delivery to the courier, and if sent by registered or certified mail on the third day after registration
or certification thereof.

 

9.3           Applicable
Law. The validity, interpretation, and performance of this Warrant Agreement and of the Warrants shall be governed in all
respects by the laws of the State of New York, without giving effect to conflict of laws. The Company hereby agrees that any action,
proceeding or claim against it arising out of or relating in any way to this Warrant Agreement shall be brought and enforced in
the courts of the State of New York or the United States District Court for the Southern District of New York, and irrevocably
submits to such jurisdiction, which jurisdiction shall be exclusive. The Company hereby waives any objection to such exclusive
jurisdiction and that such courts represent an inconvenient forum. Any such process or summons to be served upon the Company may
be served by transmitting a copy thereof by registered or certified mail, return receipt requested, postage prepaid, addressed
to it at the address set forth in Section 9.2 hereof. Such mailing shall be deemed personal service and shall be legal and binding
upon the Company in any action, proceeding or claim.

 

9.4           Persons
Having Rights under this Warrant Agreement. Nothing in this Warrant Agreement expressed and nothing that may be implied from
any of the provisions hereof is intended, or shall be construed, to confer upon, or give to, any person or corporation other than
the parties hereto and the registered holders of the Warrants and, for the purposes of Section 9.2 hereof, the underwriters in
the Offering, any right, remedy, or claim under or by reason of this Warrant Agreement or of any covenant, condition, stipulation,
promise, or agreement hereof. Each underwriter in the Offering shall be deemed to be a third-party beneficiary of this Warrant
Agreement with respect to Section 9.2 hereof. All covenants, conditions, stipulations, promises, and agreements contained in this
Warrant Agreement shall be for the sole and exclusive benefit of the parties hereto (and the underwriters in the Offering with
respect to Section 9.2 hereof) and their successors and assigns and of the registered holders of the Warrants.

 

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9.5         Examination
of the Warrant Agreement. A copy of this Warrant Agreement shall be available at all reasonable times at the office of the
Warrant Agent for inspection by the registered holder of any Warrant. The Warrant Agent may require any such holder to submit
his, her or its Warrant for inspection by it.

 

9.6         Counterparts;
Facsimile Signatures. This Warrant Agreement may be executed in any number of counterparts, and each of such counterparts
shall, for all purposes, be deemed to be an original, and all such counterparts shall together constitute one and the same instrument.
Facsimile signatures shall constitute original signatures for all purposes of this Warrant Agreement.

 

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

 

9.8         Amendments.

 

9.8.1           Amendments
Without Consent. This Warrant Agreement and the Warrants may be amended by the parties hereto by executing a supplemental
warrant agreement (a “Supplemental Agreement”), without the consent of any of the holders, for the purpose
of (i) curing any ambiguity, or curing, correcting or supplementing any defective provision contained herein, or making any other
provisions with respect to matters or questions arising under this Warrant Agreement that is not inconsistent with the provisions
of this Warrant Agreement or the Warrants, (ii) evidencing the succession of another corporation to the Company and the assumption
by any such successor of the covenants of the Company contained in this Warrant Agreement and the Warrants, (iii) evidencing and
providing for the acceptance of appointment by a successor Warrant Agent with respect to the Warrants, (iv) adding to the covenants
of the Company for the benefit of the registered holders of the Warrants or surrendering any right or power conferred upon the
Company under this Warrant Agreement, or (v) amending this Warrant Agreement and the Warrants in any manner that the Company may
deem to be necessary or desirable and that will not adversely affect the interests of the registered holders in any material respect.

 

9.8.2           Amendments
With Consent. The Company and the Warrant Agent may amend this Warrant Agreement and the Warrants by executing a Supplemental
Agreement with the consent of the registered holders of not fewer than a majority of the then unexercised Warrants affected by
such amendment, for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of
this Warrant Agreement or of modifying in any manner the rights of the registered holders under this Warrant Agreement (other
than as permitted under Section 9.8.1); provided, however, that, without the consent of each registered holder affected thereby,
no such amendment may be made that (i) changes the Warrants so as to reduce the number of shares purchasable upon exercise of
the Warrants or so as to increase the Warrant Price (other than as provided by Section 4), (ii) shortens the period
of time during which the Warrants may be exercised, (iii) otherwise adversely affects the exercise rights of the registered holders
in any material respect, or (iv) reduces the number of unexercised Warrants the registered holders of which must consent for amendment
of this Warrant Agreement or the Warrants.

 

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9.9           Severability.
This Warrant Agreement shall be deemed severable, and the invalidity or unenforceability of any term or provision hereof shall
not affect the validity or enforceability of this Warrant Agreement or of any other term or provision hereof. Furthermore, in
lieu of any such invalid or unenforceable term or provision, the parties hereto intend that there shall be added as a part of
this Warrant Agreement a provision as similar in terms to such invalid or unenforceable provision as may be possible and be valid
and enforceable.

 

9.10         Dispute
Resolution. In the case of a dispute as to the determination of the Warrant Price, the VWAP or fair market value or the arithmetic
calculation of the Warrant Shares (as the case may be), the Company or the registered holder (as the case may be) shall submit
the disputed determinations or arithmetic calculations (as the case may be) via facsimile (i) within two (2) Business Days after
receipt of the applicable notice giving rise to such dispute to the Company or the registered holder (as the case may be) or (ii)
if no notice gave rise to such dispute, at any time after the registered holder learned of the circumstances giving rise to such
dispute. If the registered holder and the Company are unable to agree upon such determination or calculation (as the case may
be) of the Warrant Price, the VWAP or fair market value or the number of Warrant Shares (as the case may be) within three (3)
Business Days of such disputed determination or arithmetic calculation being submitted to the Company or the registered holder
(as the case may be), then the Company shall, within two (2) Business Days submit via facsimile (a) the disputed determination
of the Warrant Price, the VWAP or fair market value (as the case may be) to an independent, reputable investment bank selected
by the registered holder or (b) the disputed arithmetic calculation of the Warrant Shares to the Company’s independent,
outside accountant. The Company shall cause the investment bank or the accountant (as the case may be) to perform the determinations
or calculations (as the case may be) and notify the Company and the registered holder of the results no later than ten (10) Business
Days from the time it receives such disputed determinations or calculations (as the case may be). Such investment bank’s
or accountant’s determination or calculation (as the case may be) shall be binding upon all parties absent demonstrable
error. The expenses of the investment bank or the accountant (as the case may be) and any other reasonable expenses incurred in
good faith in connection with any such dispute will be borne by the Company unless the investment bank or accountant determines
that the determination of the Warrant Price, the VWAP or fair market value or the number of Warrant Shares by the registered holder
was incorrect, in which case the expenses of the investment bank or accountant and any other reasonable expenses incurred in connection
with any such dispute will be borne by the registered holder.

 

9.11         Force
Majeure. In the event either party is unable to perform its obligations under the terms of this Warrant Agreement because
of acts of God, strikes, failure of carrier or utilities, equipment or transmission failure or damage that is reasonably beyond
its control, or any other cause that is reasonably beyond its control, such party shall not be liable for damages to the other
for any damages resulting from such failure to perform or otherwise from such causes. Performance under this Warrant Agreement
shall resume when the affected party or parties are able to perform substantially that party’s duties.

 

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10.        Certain
Definitions. For purposes of this Warrant Agreement, the following terms shall have the following meanings:

 

10.1         “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.

 

10.2         “Principal
Market” means the NYSE MKT.

 

10.3         “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).

 

10.4         “VWAP”
means, for any security as of any date, the dollar volume-weighted average price for such security on the Principal Market (or,
if the Principal Market is not the principal trading market for such security, then on the principal securities exchange or securities
market on which such security is then traded) during the period beginning at 9:30:01 a.m., New York time, and ending at 4:00:00
p.m., New York time, 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, and ending at 4:00:00 p.m., New York time, 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 “pink sheets” by Pink Sheets LLC (formerly the National Quotation Bureau, Inc.). If VWAP cannot be calculated
for such security on such date on any of the foregoing bases, the VWAP of such security on such date shall be the fair market
value as mutually determined by the Company and the registered holder. If the Company and the registered holder are unable to
agree upon the fair market value of such security, then such dispute shall be resolved in accordance with the procedures in Section
9.10. All such determinations shall be appropriately adjusted for any stock dividend, stock split, stock combination or other
similar transaction during such period.

 

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

 

	 	MEDGENICS, INC.
	 	 	 	 
	 	By:  	/s/
    Phyllis K. Bellin
	 	 	Name:	Phyllis K. Bellin
	 	 	Title:	Vice President – Administration,
	 	 	 	Corporate Secretary and Treasurer
	 	 	 	 
	 	CORPORATE STOCK TRANSFER,
    INC.
	 	 	 	 
	 	By: 	/s/
    Carylyn Bell
	 	 	Name:	Carylyn Bell
	 	 	Title:	President

 

    	22

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