Document:

EXHIBIT 10.8

 

INVESTMENT
AGREEMENT

 

by
and between

 

DOUGLAS
N. RAUCY

 

and

 

1347
PROPERTY INSURANCE HOLDINGS, INC.

 

Dated
as of             , 2014

 

 

INVESTMENT
AGREEMENT dated as of             , 2014 (this “Agreement”)
between Douglas N. Raucy (“Raucy”) and 1347 Property Insurance Holdings, Inc., a Delaware corporation (“PIH”
or the “Company”).

 

RECITALS

 

Whereas,
PIH has filed with the U.S. Securities and Exchange Commission a registration statement on Form S-1 with respect to an initial
public offering of its common stock (“IPO”);

 

Whereas,
Raucy is the President and CEO of PIH and is the holder of 288,000 shares of common stock of Prepared Holdings LLC, a limited liability
company that owns a Florida homeowner’s insurer (the “Prepared Shares”);

 

Whereas,
the Board of Directors of PIH wishes to incentivize Raucy to act in the long-term best interest of PIH and its shareholders;

 

Whereas,
in furtherance thereto, the Company desires to issue to Raucy _____ shares of common stock of PIH (the “Exchanged Shares”)
in exchange for the Prepared Shares, subject to the conditions set forth herein (the “Exchange”);

 

Whereas,
as further incentive, the Company desires to match the Exchanged Shares one-for one with restricted shares of the Company’s
common stock (the “Matched Shares”). 

 

Now,
therefore, in consideration of the mutual covenants and agreements contained in this Agreement, the receipt and sufficiency of
which are hereby acknowledged, and intending to be legally bound, the parties hereby agree as follows:

 

ARTICLE I

 

THE
EXCHANGE OF SHARES

 

Section 1.1 The
Exchange. At the Closing (as hereinafter defined), Raucy shall exchange, assign and transfer to the Company all right, title
and interest in and to the Prepared Shares, and the Company shall issue _____ shares of the common stock of the Company to Raucy.
The valuation of the Prepared Shares shall be based on tangible book value per share using the September 30, 2013 GAAP consolidated
financial statements of Prepared Holdings LLC. The number of Company shares issued to Raucy in exchange for the Prepared Shares
shall equal the value of the Prepared Shares (but in no event shall such valuation exceed $350,000) divided by the price of the
Company’s common stock price as of the close of the IPO.

 

    	 

    	 

    

 

ARTICLE II

 

CLOSING

 

Section 2.1 Closing
of the Exchange.

 

(a) The closing shall take place on _________, 2014 (the “Closing”).

 

(b)
At the Closing, Raucy shall deliver to the Company stock certificates of Prepared Holdings LLC duly transferred to the Company.
Raucy shall instruct Prepared Holdings LLC to modify its books and records to reflect the delivery and transfer of the Prepared
Shares to the Company and the Company shall receive evidence of such modification.

 

(c)
At the Closing, the Company shall issue and deliver to Raucy duly executed stock certificates of the Company registered in Raucy’s
name representing ______ shares of common stock of the Company.

 

ARTICLE III

 

REPRESENTATIONS
AND WARRANTIES OF RAUCY

 

Raucy
represents and warrants to Company as of the date hereof that all of the Prepared Shares are owned by him of record and beneficially,
free and clear of all encumbrances or liens. Raucy further represents and warrants that this Agreement is a valid and binding obligation
upon him, enforceable against him in accordance with its terms.

 

ARTICLE IV

 

REPRESENTATIONS
AND WARRANTIES OF COMPANY

 

Company
represents and warrants to Raucy as of the date hereof that:

 

Section 4.1 Existence
and Power. Company is duly organized and validly existing under the laws of the state of its organization and has all requisite
power and authority to enter into and perform its obligations under this Agreement.

 

Section 4.2 Authorization.
The execution, delivery and performance of this Agreement has been duly authorized by all necessary action on the part of the Company,
and this Agreement is a valid and binding obligation of the Company, enforceable against it in accordance with its terms.

 

Section 4.3 Valid
Issuance. The Exchanged Shares have been duly authorized by all necessary corporate action. When issued and sold against receipt
of the consideration therefor, the Exchanged Shares will be validly issued, fully paid and nonassessable, will not subject the
holders thereof to personal liability and will not be issued in violation of preemptive rights.

 

Section 4.4 Non-Contravention.
The execution, delivery and performance of this Agreement will not conflict with, violate or result in a breach of any provision
of, or constitute a default (or an event which, with notice or lapse of time or both would constitute a default) under, or result
in the termination of or accelerate the performance required by, or result in a right of termination or acceleration under, any
provision of the organizational or governing documents of Company.

 

ARTICLE V

 

MATCHED
SHARES

 

Section 5.1 Granting
of Matched Shares. As soon as practicable after the Closing, and in no event later than thirty days after the date thereof
(the “Award Date”), the Exchanged Shares shall be matched one-for-one with _______ restricted shares of the
common stock of the Company. 

 

    	 

    	 

    

 

Section
5.2 Tax Withholding. The Company shall have the right to require, prior to the issuance or delivery of any Matched Shares
or the payment of any cash pursuant to an award made hereunder, payment by Raucy of any federal, state, local or other taxes which
may be required to be withheld or paid in connection with such award. In furtherance thereof, at the Company’s option (i)
(a) the Company may withhold whole Matched Shares which would otherwise be delivered to Raucy, having an aggregate Fair Market
Value determined as of the date the obligation to withhold or pay taxes arises in connection with an award (the “Tax Date”),
or (b) withhold an amount of cash which would otherwise be payable to Raucy, in the amount necessary to satisfy any such obligation
or (ii) Raucy may satisfy any such obligation by any of the following means: (A) a cash payment to the Company in the amount necessary
to satisfy such obligation; (B) delivery (either actual delivery or by attestation procedures established by the Company) to the
Company of previously owned whole Matched Shares having an aggregate Fair Market Value, determined as of the Tax Date, equal to
the amount necessary to satisfy any such obligation; (C) authorizing the Company to withhold whole Matched Shares which would otherwise
be delivered having an aggregate Fair Market Value, determined as of the Tax Date, or withhold an amount of cash which would otherwise
be payable to Raucy, equal to the amount necessary to satisfy any such obligation; (D) or any combination of (A), (B) and (C),
in each case to the extent permitted by the Company. Matched Shares to be delivered or withheld may not have an aggregate Fair
Market Value in excess of the amount determined by applying the minimum statutory withholding rate. Any fraction of a Matched Share
which would be required to satisfy such an obligation shall be disregarded and the remaining amount due shall be paid in cash by
Raucy to the Company.

 

ARTICLE VI

 

VESTING

 

Section
6.1 Vesting. Subject to Raucy’s continued service from the Award Date through the vesting date, the Matched Shares
will not vest until the five year anniversary of the Award Date (the “Vesting Date”). In the event that Raucy
sells, transfers or otherwise disposes of any of the Exchanged Shares prior to the Vesting Date, Raucy shall forfeit to the Company
an amount of Matched Shares equal to the Exchanged Shares sold, transferred or otherwise disposed of. Raucy will automatically
forfeit to the Company all of the unvested Matched Shares made hereunder on the date of his termination of service to the extent
such termination occurs during the vesting period. Notwithstanding the foregoing vesting schedule, the Matched Shares will become
100% vested upon Raucy’s death. 

 

ARTICLE VII

 

TERMINATION

 

Section 7.1 Injunction;
Illegality. This Agreement may be terminated at any time prior to the Closing by the Company if (a) an order, injunction
or decree shall have been issued by any court or agency of competent jurisdiction and shall be non-appealable, or other law shall
have been issued preventing or making the completion of the Exchange or the other transactions contemplated by this Agreement
illegal or (b) the IPO fails to close.

 

ARTICLE VIII

 

MISCELLANEOUS

 

Section 8.1 Notices.
All notices and other communications required or permitted to be given under this Agreement shall be in writing and shall be deemed
to have been given if delivered personally or by facsimile or seven days after having been sent by certified mail, return receipt
requested, postage prepaid, to the parties to this Agreement at the following address or to such other address either party to
this Agreement shall specify by notice to the other party:

 

(a) if to Raucy, to:

 

Douglas N. Raucy

16404 Brieva DE Avila

Tampa, FL 33613

 

    	 

    	 

    

 

 

(b) if to Company, to:

 

1347 Property Insurance Holdings, Inc.

9100 Bluebonnet Centre Blvd., Suite 502

Baton Rouge, LA 70809

ATTN:  _________

 

Section 8.2 Further
Assurances. Each party hereto shall do and perform or cause to be done and performed all further acts and shall execute and
deliver all other agreements, certificates, instruments and documents as any other party hereto reasonably may request in order
to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.

 

Section 8.3 Amendments
and Waivers. Any provision of this Agreement may be amended or waived if, but only if, such amendment or waiver is in writing
and is duly executed and delivered by the Company and Raucy. No failure or delay by any party in exercising any right, power or
privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further
exercise thereof or the exercise of any other right, power or privilege. The rights and remedies herein provided shall be cumulative
and not exclusive of any rights or remedies provided by law.

 

Section 8.4 Fees
and Expenses. Each party hereto shall pay all of its own fees and expenses (including attorneys’ fees) incurred in connection
with this Agreement and the transactions contemplated hereby.

 

Section 8.5 Successors
and Assigns. The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns, provided that neither party may assign, delegate or otherwise transfer any
of its rights or obligations under this Agreement without the consent of the other party hereto.

 

Section 8.6 Governing
Law. This Agreement shall be governed and construed in accordance with the internal laws of the State of Delaware applicable
to contracts made and wholly performed within such state, without regard to any applicable conflicts of law principles. The parties
hereto agree that any suit, action or proceeding brought by either party to enforce any provision of, or based on any matter arising
out of or in connection with, this Agreement or the transactions contemplated hereby shall be brought in any federal or state court
located in the State of Delaware. Each of the parties hereto submits to the jurisdiction of any such court in any suit, action
or proceeding seeking to enforce any provision of, or based on any matter arising out of, or in connection with, this Agreement
or the transactions contemplated hereby and hereby irrevocably waives the benefit of jurisdiction derived from present or future
domicile or otherwise in such action or proceeding. Each party hereto irrevocably waives, to the fullest extent permitted by law,
any objection that it may now or hereafter have to the laying of venue of any such suit, action or proceeding in any such court
or that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum.

 

Section 8.7 Waiver
Of Jury Trial. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATED TO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY.

 

Section 8.8 Entire
Agreement. This Agreement constitutes the entire agreement between the parties with respect to the subject matter of this Agreement
and supersedes all prior agreements and understandings, both oral and written, between the parties and/or their affiliates with
respect to the subject matter of this Agreement.

 

Section 8.9 Effect
of Headings. The Article and Section headings herein are for convenience only and shall not affect the construction hereof.

 

Section 8.10 Severability.
If one or more provisions of this Agreement are held to be unenforceable under applicable law, such provision shall be deemed to
be excluded from this Agreement and the balance of this Agreement shall be interpreted as if such provision were so excluded and
shall be enforced in accordance with its terms to the maximum extent permitted by law.

 

    	 

    	 

    

 

Section 8.11 Counterparts;
Third Party Beneficiaries. This Agreement may be signed in any number of counterparts, each of which shall be an original,
with the same effect as if the signatures were upon the same instrument. No provision of this Agreement shall confer upon any person
other than the parties hereto any rights or remedies hereunder.

 

Section 8.12 Specific
Performance. The parties agree that irreparable damage would occur in the event that any of the provisions of this Agreement
were not performed in accordance with their specific terms. It is accordingly agreed that the parties shall be entitled to seek
specific performance of the terms hereof, this being in addition to any other remedies to which they are entitled at law or equity.

 

[Signature Page Follows]

 

    	 

    	 

    

 

IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective authorized officers as of
the day and year first above written.

 

	DOUGLAS N. RAUCY	 	1347 PROPERTY INSURANCE HOLDINGS, INC.
	 	 	 	 
	 	 	By:	 
	 	 	Name: 	 
	 	 	Title:	 
	 	 	 	 
	 	 	By:	 
	 	 	Name: 	 
	 	 	Title:EXHIBIT 10.9

 

SERIES A CONVERTIBLE PREFERRED SHARES
PURCHASE AGREEMENT

 

THIS SERIES A CONVERTIBLE
PREFERRED SHARES PURCHASE AGREEMENT, dated as of January 23, 2014 (as it may from time to time be amended and including all exhibits
referenced herein, this “Agreement”), is entered into by and between 1347 Property Insurance Holdings, Inc.,
a Delaware corporation (the “Company”), and Fund Management Group LLC, a Connecticut limited liability company
(the “Purchaser”).

 

RECITALS

 

WHEREAS, the Company
intends to consummate a public offering (the “Public Offering”) of the Company’s common stock, par value
$0.001 per share (the “Common Stock”); and

 

WHEREAS, prior to the
Public Offering, the Company wishes to sell, and the Purchaser wishes to purchase, an aggregate of eighty thousand (80,000) shares
of the Company’s Series A Convertible Preferred Shares, par value $25.00 per share (the “Preferred Shares”),
having the rights and preferences set forth in the Certificate of Designation attached hereto as Exhibit A (the “Certificate
of Designation”), including, without limitation, the right to convert such Preferred Shares into shares of Common Stock
and warrants to purchase shares of Common Stock (“Warrants”) on the terms and conditions set forth therein;

 

NOW THEREFORE, in consideration
of the mutual promises contained in this Agreement and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties to this Agreement hereby, intending legally to be bound, agree as follows:

 

AGREEMENT

 

1.          Purchase
and Sale of the Preferred Shares. On the date hereof (the “Closing Date”), the Company shall issue and sell
to the Purchaser, and the Purchaser shall purchase from the Company, the Preferred Shares, at a price of $25.00 per Preferred Share,
for an aggregate purchase price of two million dollars ($2,000,000) (the “Purchase Price”), which shall be paid
by wire transfer of immediately available funds to the Company in accordance with the Company’s wiring instructions. On the
Closing Date, upon the payment by the Purchaser of the Purchase Price by wire transfer of immediately available funds to the Company,
the Company shall issue the Preferred Shares to the Purchaser, and deliver to the Purchaser a stock certificate representing the
Preferred Shares.

 

2.          Representations
and Warranties of the Company. As a material inducement to the Purchaser to enter into this Agreement and purchase the Preferred
Shares, the Company hereby represents and warrants to the Purchaser (which representations and warranties shall survive the Closing
Date) that:

 

(a)          Organization
and Corporate Power. The Company is a corporation duly organized, validly existing and in good standing under the laws of the
State of Delaware and is qualified to do business in every jurisdiction in which the failure to so qualify would reasonably be
expected to have a material adverse effect on the financial condition, operating results or assets of the Company. The Company
possesses all requisite corporate power and authority necessary to carry out the transactions contemplated by this Agreement.

 

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(b)          Authorization;
No Breach.

 

(i)          The
execution, delivery and performance of this Agreement, and the issuance of the Preferred Shares, the shares of Common Stock and
Warrants issuable upon conversion of the Preferred Shares, and the issuance of the shares of Common Stock issuable upon exercise
of the Warrants, have been duly authorized by the Company as of the Closing Date. This Agreement constitutes the valid and binding
obligation of the Company, enforceable in accordance with its terms, subject to bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other laws of general applicability relating to or affecting creditors’ rights and to general
equitable principles (whether considered in a proceeding in equity or law). Upon conversion of the Preferred Shares, the Warrants
will constitute valid and binding obligations of the Company.

 

(ii)         The
execution and delivery by the Company of this Agreement and the issuance of the Preferred Shares, the shares of Common Stock and
Warrants issuable upon conversion of the Preferred Shares, and the issuance of the shares of Common Stock issuable upon exercise
of the Warrants, and compliance with the respective terms hereof and thereof by the Company, do not and will not as of the Closing
Date and the respective dates of issuance (a) conflict with or result in a breach of the terms, conditions or provisions of,
(b) constitute a default under, (c) result in the creation of any lien, security interest, charge or encumbrance upon
the Company’s capital stock or assets under, (d) result in a violation of, or (e) require any authorization, consent,
approval, exemption or other action by or notice or declaration to, or filing with, any court or administrative or governmental
body or agency pursuant to the Certificate of Incorporation of the Company or the By Laws of the Company, or any material law,
statute, rule or regulation to which the Company is subject, or any agreement, order, judgment or decree to which the Company is
subject, except for any filings required after the date hereof under federal or state securities laws.

 

(iii)        Title
to Securities. Upon issuance in accordance with, and payment pursuant to, the terms hereof, the Certificate of Designation
and the Warrant (as applicable), the Preferred Shares, the shares of Common Stock and Warrants issuable upon conversion of the
Preferred Shares, and the shares of Common Stock issuable upon exercise of the Warrants will be duly and validly issued, fully
paid and nonassessable, and the Purchaser will have good title to the Preferred Shares, the shares of Common Stock and Warrants
issuable upon conversion of the Preferred Shares, and the shares of Common Stock issuable upon exercise of the Warrants, free and
clear of all liens, claims and encumbrances of any kind, other than (i) transfer restrictions hereunder and under the other
agreements contemplated hereby, (ii) transfer restrictions under federal and state securities laws, and (iii) liens, claims
or encumbrances imposed due to the actions of the Purchaser.

 

(iv)        Governmental
Consents. No permit, consent, approval or authorization of, or declaration to or filing with, any governmental authority is
required in connection with the execution, delivery and performance by the Company of this Agreement or the consummation by the
Company of any other transactions contemplated hereby.

 

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3.          Representations
and Warranties of the Purchaser. As a material inducement to the Company to enter into this Agreement and issue and sell the
Preferred Shares to the Purchaser, the Purchaser hereby represents and warrants to the Company (which representations and warranties
shall survive the Closing Date) that:

 

(a)          Organization
and Requisite Authority. The Purchaser is a limited liability company duly organized, validly existing and in good standing
under the laws of the State of Connecticut. The Purchaser possesses all requisite company power and authority necessary to carry
out the transactions contemplated by this Agreement.

 

(b)          Authorization;
No Breach.

 

(i)          This
Agreement constitutes a valid and binding obligation of the Purchaser, enforceable in accordance with its terms, subject to bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and other laws of general applicability relating to or affecting
creditors’ rights and to general equitable principles (whether considered in a proceeding in equity or law).

 

(ii)         The
execution and delivery by the Purchaser of this Agreement and the fulfillment of and compliance with the terms hereof by the Purchaser
does not and shall not as of the Closing Date conflict with or result in a breach by the Purchaser of the terms, conditions or
provisions of any agreement, instrument, order, judgment or decree to which the Purchaser is subject.

 

(c)          Investment
Representations.

 

(i)          The
Purchaser is acquiring the Preferred Shares, the shares of Common Stock and Warrants issuable upon conversion of the Preferred
Shares, and, upon exercise of the Warrants, the Shares issuable upon such exercise (collectively, the “Securities”)
for the Purchaser’s own account, for investment purposes only and not with a view towards, or for resale in connection with,
any public sale or distribution thereof.

 

(ii)         The
Purchaser is an “accredited investor” as such term is defined in Rule 501(a)(3) of Regulation D promulgated
under the Securities Act of 1933, as amended (the “Securities Act”).

 

(iii)        The
Purchaser understands that the Securities are being offered and will be sold to it in reliance on specific exemptions from the
registration requirements of the United States federal and state securities laws and that the Company is relying upon the truth
and accuracy of, and the Purchaser’s compliance with, the representations and warranties of the Purchaser set forth herein
in order to determine the availability of such exemptions and the eligibility of the Purchaser to acquire such Securities.

 

(iv)        The
Purchaser did not decide to enter into this Agreement as a result of any general solicitation or general advertising within the
meaning of Rule 502(c) promulgated under the Securities Act.

 

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(v)         The
Purchaser has been furnished with all materials relating to the business, finances and operations of the Company and materials
relating to the offer and sale of the Securities which have been requested by the Purchaser. The Purchaser has been afforded the
opportunity to ask questions of the executive officers and directors of the Company. The Purchaser understands that its investment
in the Securities involves a high degree of risk and it has sought such accounting, legal and tax advice as it has considered necessary
to make an informed investment decision with respect to the acquisition of the Securities.

 

(vi)        The
Purchaser understands that no United States federal or state agency or any other government or governmental agency has passed on
or made any recommendation or endorsement of the Securities or the fairness or suitability of the investment in the Securities
by the Purchaser nor have such authorities passed upon or endorsed the merits of the offering of the Securities.

 

(vii)       The
Purchaser understands that: (a) the Securities have not been registered under the Securities Act or any state securities laws,
and may not be offered for sale, sold, assigned or transferred unless (1) subsequently registered thereunder or (2) sold
in reliance on an exemption therefrom; (b) the Preferred Shares and the Warrants will not be registered under the Securities Act
or any state securities laws; and (c) neither the Company nor any other person is under any obligation to register the Securities
under the Securities Act or any state securities laws or to comply with the terms and conditions of any exemption thereunder.

 

(viii)      The
Purchaser has such knowledge and experience in financial and business matters, knows of the high degree of risk associated with
investments in the securities of companies in the development stage such as the Company, is capable of evaluating the merits and
risks of an investment in the Securities and is able to bear the economic risk of an investment in the Securities in the amount
contemplated hereunder for an indefinite period of time. The Purchaser has adequate means of providing for its current financial
needs and contingencies and will have no current or anticipated future needs for liquidity which would be jeopardized by the investment
in the Securities. The Purchaser can afford a complete loss of its investments in the Securities.

 

4.          Survival
of Representations and Warranties. All of the representations and warranties contained herein shall survive the Closing Date.

 

5.          Company
Registration.

 

(a)          Piggyback
Registration Rights. If the Company proposes to register any of its Common Stock under the Securities Act in connection with
the public offering of the Common Stock solely for cash other than Excluded Registration (as defined below), the Company shall,
at such time, promptly give Purchaser notice of such registration. Upon the written request of Purchaser given within five (5)
days after such notice is given by the Company, the Company shall, subject to the provisions of Subsection 5(b), cause to
be registered all of (i) the Common Stock issuable or issued upon conversion of the Preferred Shares (the “Conversion
Shares”) and (ii) any Common Stock issued or issuable upon exercise of the Warrants issued upon conversion of the Preferred
Shares (collectively with the Conversion Shares, the “Registrable Securities”) that Purchaser has requested
to be included in such registration. The Company shall have the right to terminate or withdraw any registration initiated by it
under this Subsection 5(a) before the effective date of such registration, whether or not Purchaser has elected to include
Registrable Securities in such registration. For purposes of this Subsection 5(a), an “Excluded Registration”
shall mean (i) a registration relating to the sale of securities to employees of the Company or a subsidiary pursuant to a stock
option, stock purchase, or similar plan; (ii) a registration relating to an SEC Rule 145 transaction; (iii) a registration on any
form that does not include substantially the same information as would be required to be included in a registration statement covering
the sale of the Registrable Securities (as defined below); (iv) a registration in which the only Common Stock being registered
is Common Stock issuable upon conversion of debt securities that are also being registered; or (v) the registration of the Company’s
Common Stock on Form S-1 relating to the Company’s Public Offering.

 

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(b)          Underwriting
Requirements. In connection with any offering involving an underwriting of shares of the Company’s Common Stock pursuant
to Subsection 5(a), the Company shall not be required to include any of Purchaser’s Registrable Securities in such
underwriting unless Purchaser accepts the terms of the underwriting as agreed upon between the Company and its underwriters, and
then only in such quantity as the underwriters in their sole discretion determine will not jeopardize the success of the offering
by the Company. If the total number of Registrable Securities requested by Purchaser to be included in such offering exceeds the
number of shares of Common Stock to be sold (other than by the Company) that the underwriters in their reasonable discretion determine
is compatible with the success of the offering, then the Company shall be required to include in the offering only that number
of Registrable Securities which the underwriters and the Company in their sole discretion determine will not jeopardize the success
of the offering. Notwithstanding the foregoing, in no event shall the number of Registrable Securities included in the offering
be reduced below twenty percent (20%) of the total number of shares of Common Stock included in such offering.

 

(c)          Demand
Registration Rights. Following the twenty-four (24) month anniversary of the consummation of the Public Offering, Purchaser
may request the registration under the Securities Act of all or any portion of its Conversion Shares on Form S-3 or any successor
form thereto (each a "Short-Form Registration"). Purchaser’s request for a Short-Form Registration shall
specify the number of Conversion Shares to be registered. The Company shall cause a Registration Statement on Form S-3 (or any
successor form) to be filed as soon as practicable after the date on which the initial request is given and shall use its reasonable
best efforts to cause such Registration Statement to be declared effective by the Securities and Exchange Commission (the “SEC”)
as soon as practicable thereafter. The Company shall not be required to effect a Short-Form Registration more than one (1) time
for the Purchaser.

 

(i)          Notwithstanding
the foregoing obligations, if the Company furnishes Purchaser a certificate signed by the Company’s chief executive officer
stating that in the good faith judgment of the Company’s Board of Directors it would be materially detrimental to the Company
and its stockholders for such registration statement to either become effective or remain effective for as long as such registration
statement otherwise would be required to remain effective, because such action would (i) materially interfere with a significant
acquisition, corporate reorganization, or other similar transaction involving the Company; (ii) require premature disclosure of
material information that the Company has a bona fide business purpose for preserving as confidential; or (iii) render the Company
unable to comply with requirements under the Securities Act or Securities Exchange Act of 1934,  then the Company shall have
the right to defer taking action with respect to such filing, and any time periods with respect to filing or effectiveness thereof
shall be tolled correspondingly, for a period of not more than ninety (90) days after the request of Purchaser is given.

 

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(ii)         If
Purchaser intends to distribute the Conversion Shares covered by its request by means of an underwriting, it shall so advise the
Company as a part of its request.  The underwriter(s) will be selected by the Company and shall be reasonably acceptable to
Purchaser.  Purchaser and the Company shall enter into an underwriting agreement in customary form with the underwriter(s)
selected for such underwriting. 

 

(d)          Notwithstanding
anything to the contrary herein, shares of Common Stock shall cease to be considered Conversion Shares or Registrable Securities
when (a) a registration statement with respect to the sale of such shares shall have been declared effective under the Securities
Act by the SEC and such shares shall have been disposed of pursuant to such effective registration statement, (b) such shares have
been distributed pursuant to Rule 144 under the Securities Act and are no longer “restricted securities”, (c) such
shares have ceased to be outstanding, or (d) the entire amount of the Conversion Shares or Registrable Securities, as applicable,
may be sold by Purchaser in a single sale without, in the opinion of counsel to the Company, any limitation as to volume or manner
of sale requirements pursuant to Rule 144 under the Securities Act.

 

6.          General
Provisions.

 

(a)          Successors
and Assigns. Except as otherwise expressly provided herein, all covenants and agreements contained in this Agreement by or
on behalf of any of the parties hereto shall bind and inure to the benefit of the respective successors of the parties hereto whether
so expressed or not. Notwithstanding the foregoing or anything to the contrary herein, the parties may not assign this Agreement,
other than assignments by the Purchaser to affiliates thereof (including, without limitation, one or more of its members).

 

(b)          Transfer.
The Purchaser shall not offer, sell, transfer or otherwise dispose of the Preferred Shares without the prior written consent of
the Company.

 

(c)          Severability.
Whenever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable
law, but if any provision of this Agreement is held to be prohibited by or invalid under applicable law, such provision shall be
ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of this Agreement.

 

(d)          Counterparts.
This Agreement may be executed simultaneously in two or more counterparts, none of which need contain the signatures of more than
one party, but all such counterparts taken together shall constitute one and the same agreement.

 

    	6

    	 

    

 

(e)          Descriptive
Headings; Interpretation. The descriptive headings of this Agreement are inserted for convenience only and do not constitute
a substantive part of this Agreement. The use of the word “including” in this Agreement shall be by way of example
rather than by limitation.

 

(f)          Governing
Law. This Agreement shall be deemed to be a contract made under the laws of the State of Delaware and for all purposes shall
be construed in accordance with the internal laws of the State of Delaware.

 

(g)          Amendments.
This Agreement may not be amended, modified or waived as to any particular provision, except by a written instrument executed by
all parties hereto.

 

[Signature page follows]

 

    	7

    	 

    

 

IN WITNESS WHEREOF,
the parties hereto have executed this Agreement to be effective as of the date first set forth above.

 

	 	COMPANY:
	 	 
	 	1347 PROPERTY INSURANCE HOLDINGS, INC.
	 	 	 
	 	By:	/s/ Douglas N. Raucy
	 	Name: Douglas N. Raucy
	 	Title: Director, President & CEO
	 	 	 
	 	By:	/s/ William A. Hickey, Jr.
	 	Name: William A. Hickey, Jr.
	 	Title: Authorized Signer
	 	 	 
	 	By:	/s/ Bradley S. Diericx
	 	Name: Bradley S. Diericx
	 	Title: Authorized Signer
	 	 
	 	PURCHASER:
	 	 
	 	FUND MANAGEMENT GROUP LLC
	 	 	 
	 	By:	/s/ Gordon G. Pratt
	 	Name: Gordon G. Pratt
	 	Title: Managing Director

 

    	 

    	 

    

 

EXHIBIT A

 

Certificate of Designations

 

CERTIFICATE OF DESIGNATION OF SERIES
A CONVERTIBLE PREFERRED SHARES OF 1347 PROPERTY INSURANCE HOLDINGS, INC.

 

Pursuant to Section 151 of the General
Corporation Law of the State of Delaware, 1347 Property Insurance Holdings, Inc., a corporation organized and existing under the
General Corporation Law of the State of Delaware (the “Corporation”), in accordance with the provisions of Section
103 thereof, does hereby submit the following:

 

WHEREAS, the Second Amended and Restated
Certificate of Incorporation of the Corporation (as may be further amended or amended and restated from time to time, the “Certificate
of Incorporation”) authorizes the issuance of up to one million (1,000,000) shares of preferred stock, par value $25.00
per share, of the Corporation (“Preferred Stock”) in one or more series, and expressly authorizes the Board
of Directors of the Corporation (the "Board"), subject to limitations prescribed by law, to provide, out of the
unissued shares of Preferred Stock, for series of Preferred Stock, and, with respect to each such series, to establish and fix
the number of shares to be included in any series of Preferred Stock and the designation, rights, preferences, powers, restrictions
and limitations of the shares of such series; and

 

WHEREAS, it is the desire of the Board
to establish and fix the number of shares to be included in a new series of Preferred Stock and the designation, rights, preferences
and limitations of the shares of such new series.

 

NOW, THEREFORE, BE IT RESOLVED, that the
Board does hereby provide for the issue of a series of Preferred Stock and does hereby in this Certificate of Designation (the
“Certificate of Designation”) establish and fix and herein state and express the designation, rights, preferences,
powers, restrictions and limitations of such series of Preferred Stock as follows:

 

Designation. There shall be a series of Preferred Stock
that shall be designated as “Series A Convertible Preferred Shares” (the “Series A Preferred Shares”)
and the number of Shares constituting such series shall be 80,000. The rights, preferences, powers, restrictions and limitations
of the Series A Preferred Shares shall be as set forth herein.

 

Defined Terms. For purposes hereof, the following terms
shall have the following meanings:

 

“Board” has the
meaning set forth in the Recitals.

 

“Certificate of Designation” has
the meaning set forth in the Recitals.

 

    	 

    	 

    

 

“Certificate of Incorporation” has
the meaning set forth in the Recitals.

 

“Change of Control” means
(a) any sale, lease or transfer or series of sales, leases or transfers of all or substantially all of the consolidated assets
of the Corporation and its Subsidiaries; (b) any sale, transfer or issuance (or series of sales, transfers or issuances) of capital
stock by the Corporation or the holders of Common Stock (or other voting stock of the Corporation) that results in the inability
of the holders of Common Stock (or other voting stock of the Corporation) immediately prior to such sale, transfer or issuance
to designate or elect a majority of the board of directors (or its equivalent) of the Corporation; or (c) any merger, consolidation,
recapitalization or reorganization of the Corporation with or into another Person (whether or not the Corporation is the surviving
corporation) that results in the inability of the holders of Common Stock (or other voting stock of the Corporation) immediately
prior to such merger, consolidation, recapitalization or reorganization to designate or elect a majority of the board of directors
(or its equivalent) of the resulting entity or its parent company.

 

“Common Stock” means
the common stock, $0.001 par value per share, of the Corporation to be issued in connection with the Initial Public Offering.

 

“Common Stock Deemed Outstanding” means,
at any given time, the sum of (a) the number of shares of Common Stock actually outstanding at such time, plus (b) the number of
shares of Common Stock issuable upon exercise of Options actually outstanding at such time, plus (c) the number of shares of Common
Stock issuable upon conversion or exchange of Convertible Securities actually outstanding at such time (treating as actually outstanding
any Convertible Securities issuable upon exercise of Options actually outstanding at such time), in each case, regardless of whether
the Options or Convertible Securities are actually exercisable at such time; provided, that Common Stock Deemed Outstanding
at any given time shall not include shares owned or held by or for the account of the Corporation or any of its wholly owned Subsidiaries.

 

“Convertible Securities” means
any securities (directly or indirectly) convertible into or exchangeable for Common Stock, but excluding Options.

 

“Corporation” has
the meaning set forth in the Preamble.

 

“Conversion Price” has
the meaning set forth in Section 8.1.

 

“Conversion Shares” means
the shares of Common Stock and Warrants then issuable upon conversion of the Series A Preferred Shares in accordance with the terms
of Section 8.

 

“Date of Issuance” means,
for any Share, the Closing Date, as such term is defined in the Series A Preferred Shares Purchase Agreement.

 

    	2

    	 

    

 

"Excluded Issuances" means
any issuance or sale by the Corporation after the Date of Issuance of: (a) shares of Common Stock issued on the conversion of the
Series A Preferred Stock; (b) shares of Common Stock issued directly or upon the exercise of Options to directors, officers, employees,
or consultants of the Corporation in connection with their service as directors of the Corporation, their employment by the Corporation
or their retention as consultants by the Corporation, in each case authorized by the Board and issued pursuant to the Corporation's
2013 Equity Incentive Plan (including all such shares of Common Stock and Options outstanding prior to the Date of Issuance); or
(c) shares of Common Stock issued upon the conversion or exercise of Options (other than Options covered by clause (b) above) or
Convertible Securities issued prior to the Date of Issuance, provided that such securities are not amended after the date hereof
to increase the number of shares of Common Stock issuable thereunder or to lower the exercise or conversion price thereof.

 

“Initial Public Offering”
means the sale, in a firm commitment underwritten public offering led by a nationally recognized underwriting firm pursuant to
an effective registration statement under the Securities Act, of Common Stock of the Corporation having an aggregate offering value
(net of underwriters' discounts and selling commissions) of at least twenty million dollars ($20,000,000), following which at least
thirty percent (30%) of the total Common Stock of the Corporation on a fully diluted, as-converted basis shall have been sold to
the public and shall be listed on any national securities exchange registered with the Securities and Exchange Commission under
Section 6(a) of the Securities Exchange Act of 1934, as amended.

 

“Junior Securities” means,
collectively, the Common Stock and any other class of securities that is specifically designated as junior to the Series A Preferred
Shares.

 

“Liquidation” has
the meaning set forth in Section 5.1.

 

“Liquidation Value” means,
with respect to any Share on any given date, $25.00.

 

“Options” means
any warrants or other rights or options to subscribe for or purchase Common Stock or Convertible Securities.

 

“Person” means
an individual, corporation, partnership, joint venture, limited liability company, governmental authority, unincorporated organization,
trust, association or other entity.

 

“Preferred Stock” has
the meaning set forth in the Recitals.

 

“Securities Act” means
the Securities Act of 1933, as amended, or any successor federal statute, and the rules and regulations thereunder, which shall
be in effect at the time.

 

“Series A Preferred Shares” has
the meaning set forth in Section 1.

 

“Series A Preferred Shares Breach” has
the meaning set forth in Section 10.1.

 

    	3

    	 

    

 

“Series A Redemption” has
the meaning set forth in Section 7.1.

 

“Series A Redemption Date” has
the meaning set forth in Section 7.1.

 

“Series A Redemption Price” has
the meaning set forth in Section 7.1.

 

“Share” means a
share of Series A Preferred Shares.

 

“Subsidiary” means,
with respect to any Person, any other Person of which a majority of the outstanding shares or other equity interests having the
power to vote for directors or comparable managers are owned, directly or indirectly, by the first Person.

 

“Warrant” means a warrant
exercisable for one share of Common Stock at an exercise price equal to 120% of the per share price offered to the public in the
Initial Public Offering.

 

Rank. With respect to distribution of assets upon liquidation,
dissolution or winding up of the Corporation, whether voluntary or involuntary, all Shares of the Series A Preferred Shares shall
rank senior to all Junior Securities, and the Corporation shall not issue any other series of Preferred Stock that ranks equal
or senior to the Series A Preferred Shares while any Share is outstanding.

 

Dividends.

 

Dividends on the Series A Preferred
Shares. The Series A Preferred Shares will not be entitled to receive payment of any dividends, fixed or otherwise.

 

Restriction on Junior Securities Dividends
and Repurchases. For so long as any Share of Series A Preferred Shares is outstanding, the Corporation shall not (i) declare
or pay any dividend or make any distribution on Junior Securities, other than a dividend or distribution payable in shares of Common
Stock or in Options or Convertible Securities for which there is an adjustment pursuant to Section 8.5(e), or (ii) purchase,
redeem or acquire any Junior Securities of the Corporation.

 

Liquidation.

 

Liquidation. In the event of any
voluntary or involuntary liquidation, dissolution or winding up of the Corporation (a “Liquidation”), the holders
of Shares of Series A Preferred Shares then outstanding shall be entitled to be paid out of the assets of the Corporation available
for distribution to its stockholders, before any payment shall be made to the holders of Junior Securities by reason of their ownership
thereof, an amount in cash equal to the aggregate Liquidation Value of all Shares held by such holder, as adjusted, and will not
be entitled to any further assets of the Corporation.

 

    	4

    	 

    

 

Insufficient Assets. If upon any
Liquidation the remaining assets of the Corporation available for distribution to its stockholders shall be insufficient to pay
the holders of the Shares of Series A Preferred Shares the Liquidation Value, (a) the holders of the Shares shall share ratably
in any distribution of the remaining assets and funds of the Corporation in proportion to the respective full preferential amounts
which would otherwise be payable in respect of the Series A Preferred Shares in the aggregate upon such Liquidation if all amounts
payable on or with respect to such Shares were paid in full, and (b) the Corporation shall not make or agree to make any payments
to the holders of Junior Securities.

 

Notice Requirement. In the event
of any Liquidation, the Corporation shall, within ten (10) days following the date the Board approves such action, or no later
than twenty (20) days following any stockholders' meeting called to approve such action, or within twenty (20) day of the commencement
of any involuntary proceeding, whichever is earlier, give each holder of Shares written notice of the proposed action. Such written
notice shall describe the material terms and conditions of such proposed action, including a description of the stock, cash and
property to be received by the holders of Shares upon consummation of the proposed action and the date of delivery thereof. If
any material change in the facts set forth in the initial notice shall occur, the Corporation shall promptly give written notice
to each holder of Shares of such material change.

 

Voting. The Shares of Series A Preferred Shares shall
not be entitled to vote with respect to any matters presented to the stockholders of the Corporation for their action or consideration
(whether at a meeting of stockholders of the Corporation, by written action of stockholders in lieu of a meeting or otherwise),
except as provided by law, nor will the holders of the Series A Preferred Shares be given any notice of a meeting or vote by the
Corporation, except as provided herein.

 

Redemption of Series A Preferred Shares.

 

Mandatory Redemption. If the Initial
Public Offering has not closed by the one-year anniversary of the Date of Issuance (the “Series A Redemption Date”),
the then outstanding Shares of Series A Preferred Shares shall be redeemed by the Corporation (a “Series A Redemption”)
for a price per Share equal to $28 per Share (the “Series A Redemption Price”). In exchange for the surrender
to the Corporation by the respective holders of Shares of their certificate or certificates representing such Shares, the aggregate
Series A Redemption Price for all Shares held by each holder of Shares shall be payable in cash in immediately available funds
to the respective holders of the Series A Preferred Shares on the applicable Series A Redemption Date and the Corporation shall
contribute all of its assets to the payment of the Series A Redemption Price, and to no other corporate purpose, except to the
extent prohibited by applicable Delaware law.

 

    	5

    	 

    

 

Insufficient Funds; Remedies For Nonpayment.
 If on the Series A Redemption Date, the assets of the Corporation legally available are insufficient to pay the full Series
A Redemption Price for the total number of Shares required to be redeemed pursuant to Section 7.1, the Corporation shall
(i) take all appropriate action reasonably within its means to maximize the assets legally available for paying the Series A Redemption
Price, (ii) redeem out of all such assets legally available therefor on the applicable Series A Redemption Date the maximum possible
number of Shares that it can redeem on such date, pro rata  among the holders of such Shares to be redeemed in proportion
to the aggregate number of Shares elected to be redeemed by each such holder on the applicable Series A Redemption Date and (iii)
following the applicable Series A Redemption Date, at any time and from time to time when additional assets of the Corporation
become legally available to redeem the remaining Shares, the Corporation shall immediately use such assets to pay the remaining
balance of the aggregate applicable Series A Redemption Price.

 

Rights Subsequent to Redemption.
If on the Series A Redemption Date, the Series A Redemption Price is paid (or tendered for payment) for any of the Shares to be
redeemed on such Series A Redemption Date, then on such date all rights of the holder in the Shares so redeemed and paid or tendered
shall cease and such Shares shall no longer be deemed issued and outstanding.

 

Conversion.

 

Automatic Conversion. Subject to
the provisions of this Section 8, in connection with, and on the closing of, the Initial Public Offering by the Corporation,
all of the outstanding Shares (including any fraction of a Share) held by stockholders shall automatically convert into (A) an
aggregate number of shares of Common Stock (rounded down to the nearest whole share) as is determined by (i) multiplying the number
of Shares of Series A Preferred Shares (including any fraction of a Share) to be converted by the Liquidation Value thereof, and
then (ii) dividing the result by the Conversion Price in effect immediately prior to such conversion and (B) an aggregate number
of Warrants (rounded down to the nearest whole Warrant) equal to the number of shares of Common Stock issued as a result of the
conversion (as determined in accordance with clause (A) of this Section 8.1); provided, however, that the
aggregate amount of shares of Common Stock issued upon conversion hereunder shall not exceed 9.99% of the outstanding shares of
Common Stock of the Corporation immediately prior to such Conversion, and any Shares not converted because of this provision, may,
at the option of the stockholder, be (x) converted after the required regulatory approval or (y) redeemed at a price per Share
equal to the Series A Redemption Price; and provided, further, that if regulatory approval is not obtained within
six (6) months of the date of the closing of the Initial Public Offering, then all remaining Shares shall be redeemed in accordance
with clause (y) above. The initial conversion price per Series A Preferred Share (the “Conversion Price”) shall
be determined by multiplying 0.8 by the price per share of Common Stock offered to the public in the Initial Public Offering, subject
to adjustment as applicable in accordance with Section 8.5 below. If the closing of the Initial Public Offering occurs,
such automatic conversion of all of the outstanding Shares of Series A Preferred Shares shall be deemed to have occurred immediately
prior to such closing.

 

    	6

    	 

    

 

Procedures for Conversion; Effect of
Conversion

 

Procedures for Automatic Conversion.
As of the closing of the Initial Public Offering all outstanding Shares of Series A Preferred Shares shall be converted to the
number of shares of Common Stock and Warrants calculated pursuant to Section 8.1 without any further action by the relevant
holder of such Shares or the Corporation. As promptly as practicable following such Initial Public Offering (but in any event within
five (5) days thereafter), the Corporation shall send each holder of Shares of Series A Preferred Shares written notice of such
event. Upon receipt of such notice, each holder shall surrender to the Corporation the certificate or certificates representing
the Shares being converted, duly assigned or endorsed for transfer to the Corporation (or accompanied by duly executed stock powers
relating thereto) or, in the event the certificate or certificates are lost, stolen or missing, accompanied by an affidavit of
loss executed by the holder. Upon the surrender of such certificate(s) and accompanying materials, the Corporation shall as promptly
as practicable (but in any event within ten (10) days thereafter) deliver to the relevant holder a certificate in such holder's
name (or the name of such holder's designee as stated in the written election) for the number of shares of Common Stock and the
number of Warrants to which such holder shall be entitled upon conversion of the applicable Shares. All shares of Common Stock
issued hereunder (or issued upon the exercise of Warrants issued hereunder in accordance with the terms thereof) by the Corporation
shall be duly and validly issued, fully paid and nonassessable, free and clear of all taxes, liens, charges and encumbrances with
respect to the issuance thereof.

 

Effect of Conversion. All Shares of
Series A Preferred Shares converted as provided in this Section 8.1 shall no longer be deemed outstanding as of the effective
time of the applicable conversion and all rights with respect to such Shares shall immediately cease and terminate as of such time
(including, without limitation, any right of redemption pursuant to Section 7), other than the right of the holder to receive
shares of Common Stock and Warrants in exchange therefor pursuant to the terms of this Agreement.

 

Reservation of Stock. The Corporation
shall at all times when any Share is outstanding reserve and keep available out of its authorized but unissued shares of capital
stock, solely for the purpose of issuance upon the conversion of the Series A Preferred Shares, such number of shares of Common
Stock issuable upon the conversion of all outstanding Series A Preferred Shares pursuant to this Section 8, including all
shares of Common Stock issuable upon exercise of the Warrants, taking into account any adjustment to such number of shares so issuable
in accordance with Section 8.5 hereof. The Corporation shall take all such actions as may be necessary to assure that all
such shares of Common Stock may be so issued without violation of any applicable law or governmental regulation or any requirements
of any domestic securities exchange upon which shares of Common Stock may be listed (except for official notice of issuance which
shall be immediately delivered by the Corporation upon each such issuance). The Corporation shall not close its books against the
transfer of any of its capital stock in any manner which would prevent the timely conversion of the Shares of Series A Preferred
Shares.

 

    	7

    	 

    

 

No Charge or Payment. The issuance
of certificates for shares of Common Stock upon conversion of Shares pursuant to Section 8.1 shall be made without payment
of additional consideration by, or other charge, cost or tax to, the holder in respect thereof.

 

Adjustment to Conversion Price and Number
of Conversion Shares. In order to prevent dilution of the conversion rights granted under this Section 8, the Conversion
Price and the number of Conversion Shares issuable on conversion of the Shares of Series A Preferred Shares shall be subject to
adjustment from time to time as provided in this Section 8.5.

 

Adjustment to Conversion Price upon Issuance
of Common Stock. Except in the case of an event described in either Section 8.5(c) or Section 8.5(d), if any
Shares remain outstanding following the Initial Public Offering, and the Corporation shall, at any time or from time to time after
the closing of the Initial Public Offering, issue or sell, or is deemed to have issued or sold, any shares of Common Stock without
consideration or for consideration per share less than the Conversion Price in effect immediately prior to such issuance or sale
(or deemed issuance or sale), then immediately upon such issuance or sale (or deemed issuance or sale), the Conversion Price in
effect immediately prior to such issuance or sale (or deemed issuance or sale) shall be reduced (and in no event increased) to
a Conversion Price equal to the quotient obtained by dividing:

 

the sum of (A) the product
obtained by multiplying the Common Stock Deemed Outstanding immediately prior to such issuance or sale (or deemed issuance or sale)
by the Conversion Price then in effect plus (B) the aggregate consideration, if any, received by the Corporation upon such issuance
or sale (or deemed issuance or sale); by

 

the sum of (A) the Common
Stock Deemed Outstanding immediately prior to such issuance or sale (or deemed issuance or sale) plus (B) the aggregate number
of shares of Common Stock issued or sold (or deemed issued or sold) by the Corporation in such issuance or sale (or deemed issuance
or sale).

 

Adjustment to Number of Conversion Shares
Upon Adjustment to Conversion Price. Upon any and each adjustment of the Conversion Price as provided in Section 8.5(a),
the number of Conversion Shares issuable upon the conversion of the Series A Preferred Shares immediately prior to any such adjustment
shall be increased to a number of Conversion Shares equal to the quotient obtained by dividing:

 

    	8

    	 

    

 

the product of (A) the Conversion
Price in effect immediately prior to any such adjustment multiplied by (B) the number of Conversion Shares issuable upon conversion
of the Series A Preferred Shares immediately prior to any such adjustment; by

 

the Conversion Price resulting
from such adjustment.

 

Exceptions To Adjustment Upon Issuance
of Common Stock. Anything herein to the contrary notwithstanding, there shall be no adjustment to the Conversion Price or the
number of Conversion Shares issuable upon conversion of the Series A Preferred Stock with respect to any Excluded Issuance.

 

Effect of Certain Events on Adjustment
to Conversion Price. For purposes of determining the adjusted Conversion Price under Section 8.5(a) hereof, the following
shall be applicable:

 

Issuance of Options.
If any Shares remain outstanding after the Initial Public Offering, and the Corporation shall, following the closing of the Initial
Public Offering, at any time or from time to time, in any manner grant or sell (whether directly or by assumption in a merger or
otherwise) any Options, whether or not such Options or the right to convert or exchange any Convertible Securities issuable upon
the exercise of such Options are immediately exercisable, and the price per share (determined as provided in this paragraph and
in Section 8.5(d)(v)) for which Common Stock is issuable upon the exercise of such Options or upon the conversion or exchange
of Convertible Securities issuable upon the exercise of such Options is less than the Conversion Price in effect immediately prior
to the time of the granting or sale of such Options, then the total maximum number of shares of Common Stock issuable upon the
exercise of such Options or upon conversion or exchange of the total maximum amount of Convertible Securities issuable upon the
exercise of such Options shall be deemed to have been issued as of the date of granting or sale of such Options (and thereafter
shall be deemed to be outstanding for purposes of adjusting the Conversion Price under Section 8.5(a)), at a price per share
equal to the quotient obtained by dividing (A) the sum (which sum shall constitute the applicable consideration received for purposes
of Section 8.5(a)) of (x) the total amount, if any, received or receivable by the Corporation as consideration for the granting
or sale of all such Options, plus (y) the minimum aggregate amount of additional consideration payable to the Corporation upon
the exercise of all such Options, plus (z), in the case of such Options which relate to Convertible Securities, the minimum aggregate
amount of additional consideration, if any, payable to the Corporation upon the issuance or sale of all such Convertible Securities
and the conversion or exchange of all such Convertible Securities, by (B) the total maximum number of shares of Common Stock issuable
upon the exercise of all such Options or upon the conversion or exchange of all Convertible Securities issuable upon the exercise
of all such Options. Except as otherwise provided in Section 8.5(d)(iii), no further adjustment of the Conversion Price
shall be made upon the actual issuance of Common Stock or of Convertible Securities upon exercise of such Options or upon the actual
issuance of Common Stock upon conversion or exchange of Convertible Securities issuable upon exercise of such Options.

 

    	9

    	 

    

 

Issuance of Convertible
Securities. If the Corporation shall, at any time or from time to time after the Date of Issuance, in any manner grant or sell
(whether directly or by assumption in a merger or otherwise) any Convertible Securities, whether or not the right to convert or
exchange any such Convertible Securities is immediately exercisable, and the price per share (determined as provided in this paragraph
and in Section 8.5(d)(v)) for which Common Stock is issuable upon the conversion or exchange of such Convertible Securities
is less than the Conversion Price in effect immediately prior to the time of the granting or sale of such Convertible Securities,
then the total maximum number of shares of Common Stock issuable upon conversion or exchange of the total maximum amount of such
Convertible Securities shall be deemed to have been issued as of the date of granting or sale of such Convertible Securities (and
thereafter shall be deemed to be outstanding for purposes of adjusting the Conversion Price pursuant to Section 8.5(a)),
at a price per share equal to the quotient obtained by dividing (A) the sum (which sum shall constitute the applicable consideration
received for purposes of Section 8.5(a)) of (x) the total amount, if any, received or receivable by the Corporation as consideration
for the granting or sale of such Convertible Securities, plus (y) the minimum aggregate amount of additional consideration, if
any, payable to the Corporation upon the conversion or exchange of all such Convertible Securities, by (B) the total maximum number
of shares of Common Stock issuable upon the conversion or exchange of all such Convertible Securities. Except as otherwise provided
in Section 8.5(d)(iii), (A) no further adjustment of the Conversion Price shall be made upon the actual issuance of Common
Stock upon conversion or exchange of such Convertible Securities and (B) no further adjustment of the Conversion Price shall be
made by reason of the issue or sale of Convertible Securities upon exercise of any Options to purchase any such Convertible Securities
for which adjustments of the Conversion Price have been made pursuant to the other provisions of this Section 8.5(d).

 

    	10

    	 

    

 

Change in Terms of Options
or Convertible Securities. Upon any change in any of (A) the total amount received or receivable by the Corporation as consideration
for the granting or sale of any Options or Convertible Securities referred to in Section 8.5(d)(i) or Section 8.5(d)(ii)
hereof, (B) the minimum aggregate amount of additional consideration, if any, payable to the Corporation upon the exercise of any
Options or upon the issuance, conversion or exchange of any Convertible Securities referred to in Section 8.5(d)(i) or Section
8.5(d)(ii) hereof, (C) the rate at which Convertible Securities referred to in Section 8.5(d)(i) or Section 8.5(d)(ii)
hereof are convertible into or exchangeable for Common Stock, or (D) the maximum number of shares of Common Stock issuable in connection
with any Options referred to in Section 8.5(d)(i) hereof or any Convertible Securities referred to in Section 8.5(d)(ii)
hereof (in each case, other than in connection with an Excluded Issuance), then (whether or not the original issuance or sale of
such Options or Convertible Securities resulted in an adjustment to the Conversion Price pursuant to this Section 8.5) the
Conversion Price in effect at the time of such change shall be adjusted or readjusted, as applicable, to the Conversion Price which
would have been in effect at such time pursuant to the provisions of this Section 8.5 had such Options or Convertible Securities
still outstanding provided for such changed consideration, conversion rate or maximum number of shares, as the case may be, at
the time initially granted, issued or sold, but only if as a result of such adjustment or readjustment the Conversion Price then
in effect is reduced, and the number of Conversion Shares issuable upon the conversion of the Series A Preferred Stock immediately
prior to any such adjustment or readjustment shall be correspondingly adjusted or readjusted pursuant to the provisions of Section
8.5(b).

 

Treatment of Expired or
Terminated Options or Convertible Securities. Upon the expiration or termination of any unexercised Option (or portion thereof)
or any unconverted or unexchanged Convertible Security (or portion thereof) for which any adjustment (either upon its original
issuance or upon a revision of its terms) was made pursuant to this Section 8.5 (including without limitation upon the redemption
or purchase for consideration of all or any portion of such Option or Convertible Security by the Corporation), the Conversion
Price then in effect hereunder shall forthwith be changed pursuant to the provisions of this Section 8.5 to the Conversion
Price which would have been in effect at the time of such expiration or termination had such unexercised Option (or portion thereof)
or unconverted or unexchanged Convertible Security (or portion thereof), to the extent outstanding immediately prior to such expiration
or termination, never been issued.

 

    	11

    	 

    

 

Calculation of Consideration
Received. If the Corporation shall, at any time or from time to time after the Date of Issuance, issue or sell, or is deemed
to have issued or sold in accordance with Section 8.5(d), any shares of Common Stock, Options or Convertible Securities:
(A) for cash, the consideration received therefor shall be deemed to be the net amount received by the Corporation therefor; (B)
for consideration other than cash, the amount of the consideration other than cash received by the Corporation shall be the fair
value of such consideration, except where such consideration consists of marketable securities, in which case the amount of consideration
received by the Corporation shall be the market price (as reflected on any securities exchange, quotation system or association
or similar pricing system covering such security) for such securities as of the end of business on the date of receipt of such
securities; (C) for no specifically allocated consideration in connection with an issuance or sale of other securities of the Corporation,
together comprising one integrated transaction, the amount of the consideration therefor shall be deemed to be the fair value of
such portion of the aggregate consideration received by the Corporation in such transaction as is attributable to such shares of
Common Stock, Options or Convertible Securities, as the case may be, issued in such transaction; or (D) to the owners of the non-surviving
entity in connection with any merger in which the Corporation is the surviving corporation, the amount of consideration therefor
shall be deemed to be the fair value of such portion of the net assets and business of the non-surviving entity as is attributable
to such shares of Common Stock, Options or Convertible Securities, as the case may be, issued to such owners. The net amount of
any cash consideration and the fair value of any consideration other than cash or marketable securities shall be determined in
good faith by the Board.

 

Record Date. For purposes
of any adjustment to the Conversion Price or the number of Conversion Shares in accordance with this Section 8.5, in case
the Corporation shall take a record of the holders of its Common Stock for the purpose of entitling them (A) to receive a dividend
or other distribution payable in Common Stock, Options or Convertible Securities or (B) to subscribe for or purchase Common Stock,
Options or Convertible Securities, then such record date shall be deemed to be the date of the issue or sale of the shares of Common
Stock deemed to have been issued or sold upon the declaration of such dividend or the making of such other distribution or the
date of the granting of such right of subscription or purchase, as the case may be.

 

Treasury Shares. The
number of shares of Common Stock outstanding at any given time shall not include shares owned or held by or for the account of
the Corporation or any of its wholly-owned subsidiaries, and the disposition of any such shares (other than the cancellation or
retirement thereof or the transfer of such shares among the Corporation and its wholly-owned subsidiaries) shall be considered
an issue or sale of Common Stock for the purpose of this Section 8.5.

 

    	12

    	 

    

 

Adjustment to Conversion Price and Conversion
Shares Upon Stock Dividend, Subdivision or Combination of Common Stock. If any Shares remain outstanding following the Initial
Public Offering, and the Corporation shall, at any time or from time to time after the closing of the Initial Public Offering,
(i) pay a dividend or make any other distribution upon the Common Stock or any other capital stock of the Corporation payable in
shares of Common Stock or in Options or Convertible Securities, or (ii) subdivide (by any stock split, recapitalization or otherwise)
its outstanding shares of Common Stock into a greater number of shares, the Conversion Price in effect immediately prior to any
such subdivision shall be proportionately reduced and the number of Conversion Shares issuable upon conversion of the Series A
Preferred Shares shall be proportionately increased. If any Shares remain outstanding following the Initial Public Offering, and
the Corporation at any time thereafter combines (by combination, reverse stock split or otherwise) its outstanding shares of Common
Stock into a smaller number of shares, the Conversion Price in effect immediately prior to such combination shall be proportionately
increased and the number of Conversion Shares issuable upon conversion of the Series A Preferred Shares shall be proportionately
decreased. Any adjustment under this Section 8.5(c) shall become effective at the close of business on the date the dividend,
subdivision or combination becomes effective.

 

Adjustment to Conversion Price and Conversion
Shares Upon Reorganization, Reclassification, Consolidation or Merger. Following the Initial Public Offering, if any Shares
remain outstanding, in the event of any (i) capital reorganization of the Corporation, (ii) reclassification of the stock of the
Corporation (other than a change in par value or from par value to no par value or from no par value to par value or as a result
of a stock dividend or subdivision, split-up or combination of shares), (iii) consolidation or merger of the Corporation with or
into another Person, (iv) sale of all or substantially all of the Corporation's assets to another Person or (v) other similar transaction
(other than any such transaction covered by Section 8.5(c)), in each case which entitles the holders of Common Stock to
receive (either directly or upon subsequent liquidation) stock, securities or assets with respect to or in exchange for Common
Stock, each Share of Series A Preferred Shares shall, immediately after such reorganization, reclassification, consolidation, merger,
sale or similar transaction, remain outstanding and shall thereafter, in lieu of or in addition to (as the case may be) the number
of Conversion Shares then convertible for such Share, be exercisable for the kind and number of shares of stock or other securities
or assets of the Corporation or of the successor Person resulting from such transaction to which such Share would have been entitled
upon such reorganization, reclassification, consolidation, merger, sale or similar transaction if the Share had been converted
in full immediately prior to the time of such reorganization, reclassification, consolidation, merger, sale or similar transaction
and acquired the applicable number of Conversion Shares then issuable hereunder as a result of such conversion (without taking
into account any limitations or restrictions on the convertibility of such Share, if any); and, in such case, appropriate adjustment
shall be made with respect to such holder's rights under this Certificate of Designation to insure that the provisions of this
Section 8 hereof shall thereafter be applicable, as nearly as possible, to the Series A Preferred Shares in relation to
any shares of stock, securities or assets thereafter acquirable upon conversion of Series A Preferred Shares (including, in the
case of any consolidation, merger, sale or similar transaction in which the successor or purchasing Person is other than the Corporation,
an immediate adjustment in the Conversion Price to the value per share for the Common Stock reflected by the terms of such consolidation,
merger, sale or similar transaction, and a corresponding immediate adjustment to the number of Conversion Shares acquirable upon
conversion of the Series A Preferred Shares without regard to any limitations or restrictions on conversion, if the value so reflected
is less than the Conversion Price in effect immediately prior to such consolidation, merger, sale or similar transaction). The
provisions of this Section 8.5(d) shall similarly apply to successive reorganizations, reclassifications, consolidations,
mergers, sales or similar transactions. The Corporation shall not effect any such reorganization, reclassification, consolidation,
merger, sale or similar transaction unless, prior to the consummation thereof, the successor Person (if other than the Corporation)
resulting from such reorganization, reclassification, consolidation, merger, sale or similar transaction, shall assume, by written
instrument substantially similar in form and substance to this Certificate of Designation, the obligation to deliver to the holders
of Series A Preferred Shares such shares of stock, securities or assets which, in accordance with the foregoing provisions, such
holders shall be entitled to receive upon conversion of the Series A Preferred Shares.

 

    	13

    	 

    

 

Certain Events. Following the Initial
Public Offering, if any Shares remain outstanding, if any event of the type contemplated by the provisions of this Section 8.5
but not expressly provided for by such provisions (including, without limitation, the granting of stock appreciation rights, phantom
stock rights or other rights with equity features) occurs, then the Board shall make an appropriate adjustment in the Conversion
Price and the number of Conversion Shares issuable upon conversion of Shares of Series A Preferred Shares so as to protect the
rights of the holder of such Shares in a manner consistent with the provisions of this Section 8; provided, that
no such adjustment pursuant to this Section 8.5 shall increase the Conversion Price or decrease the number of Conversion
Shares issuable as otherwise determined pursuant to this Section 8.

 

Certificate as to Adjustment. As promptly
as reasonably practicable following any adjustment of the Conversion Price, but in any event not later than 20 days thereafter,
the Corporation shall furnish to each holder of record of Series A Preferred Shares at the address specified for such holder in
the books and records of the Corporation (or at such other address as may be provided to the Corporation in writing by such holder)
a certificate of an executive officer setting forth in reasonable detail such adjustment and the facts upon which it is based and
certifying the calculation thereof.

 

Notices. Following the Initial Public
Offering, if any Shares remain outstanding, in the event:

 

    	14

    	 

    

 

of any capital reorganization
of the Corporation, any reclassification of the Common Stock of the Corporation, any consolidation or merger of the Corporation
with or into another Person, or sale of all or substantially all of the Corporation's assets to another Person; or

 

of the voluntary or involuntary
dissolution, liquidation or winding-up of the Corporation;

 

then, and in each such case, the Corporation
shall send or cause to be sent to each holder of record of Series A Preferred Shares at the address specified for such holder in
the books and records of the Corporation (or at such other address as may be provided to the Corporation in writing by such holder)
at least five (5) days prior to the applicable record date or the applicable expected effective date, as the case may be, for the
event, a written notice specifying, as the case may be, (A) the record date for such dividend, distribution, meeting or consent
or other right or action, and a description of such dividend, distribution or other right or action to be taken at such meeting
or by written consent, or (B) the effective date on which such reorganization, reclassification, consolidation, merger, sale, dissolution,
liquidation or winding-up is proposed to take place, and the date, if any is to be fixed, as of which the books of the Corporation
shall close or a record shall be taken with respect to which the holders of record of Common Stock (or such other capital stock
or securities at the time issuable upon conversion of the Series A Preferred Shares) shall be entitled to exchange their shares
of Common Stock (or such other capital stock or securities) for securities or other property deliverable upon such reorganization,
reclassification, consolidation, merger, sale, dissolution, liquidation or winding-up, and the amount per share and character of
such exchange applicable to the Series A Preferred Shares and the Conversion Shares.

 

Warrants.

 

Underlying Warrant Terms.

 

Exercise. Each Warrant underlying
the Series A Preferred Shares shall be immediately exercisable after issuance and will be exercisable into one share of Common
Stock at an exercise price equal to 120% of the Initial Public Offering price per share of Common Stock. The Warrants will expire
worthless on the five (5) year anniversary of the Date of Issuance.

 

Redemption. The Warrants will be redeemable
by the Corporation at a price of $0.01 per Warrant during any period in which the closing price of the shares of Common Stock equals
or exceeds 175% of the Initial Public Offering price per share of Common Stock for 20 consecutive trading days. Holders of the
Warrants will be entitled to notice of such redemption 30 days prior to the date of redemption.

 

    	15

    	 

    

 

Breach of Obligations.

 

Series A Preferred Shares Breach.
A breach by the Corporation of the rights, preferences, powers, restrictions and limitations of the Series A Preferred Shares set
forth herein shall mean the occurrence of one or more of any of the events and conditions set forth in this Section 10.1
(each such event or condition, a “Series A Preferred Shares Breach”), whether such event or condition occurs
voluntarily or involuntarily, by operation of law or pursuant to any judgment, order, decree, rule or regulation and regardless
of the reason or cause of such event or condition.

 

Nonpayment of Redemption or Liquidation
Payments. The failure of the Corporation to make any (i) redemption payment when due pursuant to Section 7 or (ii) liquidation
payment when due pursuant to Section 5, in each case whether or not such payment is legally permissible or is otherwise
prohibited.

 

Bankruptcy or Insolvency. The Corporation
or any of its Subsidiaries (i) becomes insolvent or admits its inability to pay its debts generally as they become due; (ii) becomes
subject, voluntarily or involuntarily, to any proceeding under any domestic or foreign bankruptcy or insolvency law, which is not
fully stayed within seven (7) days or is not dismissed or vacated within forty-five (45) days after filing; (iii) makes a general
assignment for the benefit of creditors; or (iv) has a receiver, trustee, custodian or similar agent appointed by order of any
court of competent jurisdiction to take charge of or sell any material portion of its property or business.

 

Consequences of Breach. In addition
to any other rights which a holder of Shares of Series A Preferred Shares is entitled under any other contract or agreement and
any other rights such holder may have pursuant to applicable law, the holders of Shares of Series A Preferred Shares shall have
the rights and remedies set forth in this Section 10.2 on the occurrence of a Series A Preferred Shares Breach.

 

Redemption Right. If a Series A Preferred
Shares Breach has occurred (other than a Series A Preferred Shares Breach described in Section 10.1(b)) and is continuing
for a period of thirty (30) days, any holder of Series A Preferred Shares shall have the right to elect to have, out of funds legally
available therefor, all (but not less than all) of the then outstanding Shares of Series A Preferred Shares immediately redeemed
by the Corporation for a price per Share equal to the Series A Redemption Price. Any such redemption shall occur not more than
twenty (20) days following receipt by the Corporation of the request by the holder.

 

Automatic Redemption on Bankruptcy.
Notwithstanding the earliest date for redemption set forth in Section 7.1, if a Series A Preferred Shares Breach described
in Section 10.1(b) has occurred, all of the then outstanding Shares of Series A Preferred Shares shall be subject to redemption
immediately without any action required by the holders of Shares of Series A Preferred Shares, for a price per Share equal to the
Series A Redemption Price. Any such redemption shall occur immediately and shall otherwise be executed in accordance with the provisions
of Section 7, applied mutatis mutandis.

 

    	16

    	 

    

 

Reissuance of Series A Preferred Shares. Any Shares of
Series A Preferred Shares redeemed, converted or otherwise acquired by the Corporation or any Subsidiary shall be cancelled and
retired as authorized and issued shares of capital stock of the Corporation and no such Shares shall thereafter be reissued, sold
or transferred.

 

Notices. Except as otherwise provided herein, all notices,
requests, consents, claims, demands, waivers and other communications hereunder shall be in writing and shall be deemed to have
been given: (a) when delivered by hand (with written confirmation of receipt); (b) when received by the addressee if sent by a
nationally recognized overnight courier (receipt requested); (c) on the date sent by facsimile or e-mail of a PDF document (with
confirmation of transmission) if sent during normal business hours of the recipient, and on the next business day if sent after
normal business hours of the recipient; or (d) on the third day after the date mailed, by certified or registered mail, return
receipt requested, postage prepaid. Such communications must be sent (a) to the Corporation, at its principal executive offices
and (b) to any stockholder, at such holder's address at it appears in the stock records of the Corporation (or at such other address
for a stockholder as shall be specified in a notice given in accordance with this Section 12).

 

Amendment and Waiver. No provision of this Certificate
of Designation may be amended, modified or waived except by an instrument in writing executed by the Corporation and holders of
at least 50% of the Shares, and any such written amendment, modification or waiver will be binding upon the Corporation and each
holder of Series A Preferred Shares; provided, that no such action shall change or waive (a) the definition of Liquidation
Value or (b) this Section 13, without the prior written consent of each holder of outstanding Shares of Series A Preferred
Shares; provided, further, that no amendment, modification or waiver of the terms or relative priorities of the Series
A Preferred Shares may be accomplished by the merger, consolidation or other transaction of the Corporation with another corporation
or entity unless the Corporation has obtained the prior written consent of the holders in accordance with this Section 13.

 

[SIGNATURE PAGE FOLLOWS]

 

    	17

    	 

    

 

IN WITNESS WHEREOF, this Certificate of
Designation is duly executed on behalf of the Corporation by an authorized officer as of this 16th day of January 2014.

 

	 	1347 PROPERTY INSURANCE
	 	HOLDINGS, INC.
	 	 
	 	By:	/s/ Douglas N. Raucy
	 	 	Name:  Douglas N. Raucy
	 	 	Title:  President and Chief Executive Officer

 

    	18

    	 

    

 

EXHIBIT B

 

[Form of Warrant]

 

WARRANT

 

THIS WARRANT AND THE SECURITIES ISSUABLE
UPON EXERCISE OF THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"),
OR QUALIFIED UNDER ANY STATE OR FOREIGN SECURITIES LAWS AND MAY NOT BE OFFERED FOR SALE, SOLD, PLEDGED, HYPOTHECATED OR OTHERWISE
TRANSFERRED OR ASSIGNED UNLESS (I) A REGISTRATION STATEMENT COVERING SUCH SHARES IS EFFECTIVE UNDER THE ACT AND IS QUALIFIED UNDER
APPLICABLE STATE AND FOREIGN LAW OR (II) THE TRANSACTION IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS UNDER
THE ACT AND THE QUALIFICATION REQUIREMENTS UNDER APPLICABLE STATE AND FOREIGN LAW AND, IF THE CORPORATION REQUESTS, AN OPINION
SATISFACTORY TO THE CORPORATION TO SUCH EFFECT HAS BEEN RENDERED BY COUNSEL.

 

NO TRANSFER, SALE, ASSIGNMENT, PLEDGE, HYPOTHECATION
OR OTHER DISPOSITION OF THIS WARRANT MAY BE MADE WITHOUT THE CONSENT OF THE COMPANY (AS DEFINED BELOW).

 

Warrant Certificate No.: [NUMBER]

 

Original Issue Date: [DATE]

 

FOR VALUE RECEIVED, 1347 PROPERTY INSURANCE
HOLDINGS, INC., a Delaware corporation (the "Company"), hereby certifies that [NAME OF HOLDER], a [JURISDICTION
AND TYPE OF ENTITY], or its registered permitted assigns (the "Holder") is entitled to purchase from the Company
[SPECIFIED NUMBER] duly authorized, validly issued, fully paid and nonassessable shares of Common Stock at a purchase price per
share of $[_____] (subject to adjustment as provided herein, the "Exercise Price"), all subject to the terms,
conditions and adjustments set forth below in this Warrant. Certain capitalized terms used herein are defined in 1 hereof.

 

This Warrant has been issued pursuant to
the terms of the Series A Preferred Stock of the Company.

 

    	1

    	 

    

 

Definitions. As used in this Warrant, the following terms
have the respective meanings set forth below:

 

"Aggregate Exercise Price" means
an amount equal to the product of (a) the number of Warrant Shares in respect of which this Warrant is then being exercised pursuant
to Section 3 hereof, multiplied by (b) the Exercise Price in effect as of the Exercise Date in accordance with the terms
of this Warrant.

 

"Board" means the
board of directors of the Company.

 

"Business Day" means
any day, except a Saturday, Sunday or legal holiday, on which banking institutions in the city of [LOCATION] are authorized or
obligated by law or executive order to close.

 

"Common Stock" means
the common stock, par value $0.001 per share, of the Company, and any capital stock into which such Common Stock shall have been
converted, exchanged or reclassified following the date hereof.

 

"Common Stock Deemed Outstanding" means,
at any given time, the sum of (a) the number of shares of Common Stock actually outstanding at such time, plus (b) the number of
shares of Common Stock issuable upon exercise of Options actually outstanding at such time, plus (c) the number of shares of Common
Stock issuable upon conversion or exchange of Convertible Securities actually outstanding at such time (treating as actually outstanding
any Convertible Securities issuable upon exercise of Options actually outstanding at such time), in each case, regardless of whether
the Options or Convertible Securities are actually exercisable at such time; provided, that Common Stock Deemed Outstanding
at any given time shall not include shares owned or held by or for the account of the Company or any of its wholly owned subsidiaries.

 

"Company" has the
meaning set forth in the preamble.

 

"Convertible Securities" means
any securities (directly or indirectly) convertible into or exchangeable for Common Stock, but excluding Options.

 

"Excluded Issuances" means
any issuance or sale by the Corporation after the Original Issue Date of: (a) shares of Common Stock issued upon the exercise of
this Warrant; (b) [up to an aggregate of [NUMBER]] shares of Common Stock issued directly or upon the exercise of Options to directors,
officers, employees, or consultants of the Company in connection with their service as directors of the Company, their employment
by the Company or their retention as consultants by the Company, in each case authorized by the Board and issued pursuant to the
Company's 2013 Equity Incentive Plan [(including all such shares of Common Stock and Options outstanding prior to the Original
Issue Date)][; or (c) shares of Common Stock issued upon the conversion or exercise of Options (other than Options covered by clause
(b) above) or Convertible Securities issued prior to the Original Issue Date, provided that such securities are not amended after
the date hereof to increase the number of shares of Common Stock issuable thereunder or to lower the exercise or conversion price
thereof.]

 

    	2

    	 

    

 

"Exercise Date" means,
for any given exercise of this Warrant, the date on which the conditions to such exercise as set forth in Section 3 shall
have been satisfied at or prior to 5:00 p.m., [LOCATION] time, on a Business Day, including, without limitation, the receipt by
the Company of the Exercise Agreement, the Warrant and the Aggregate Exercise Price.

 

"Exercise Agreement" has
the meaning set forth in Section 3(a)(i).

 

"Exercise Period" has
the meaning set forth in Section 2.

 

"Exercise Price" has
the meaning set forth in the preamble.

 

"Fair Market Value" means,
as of any particular date: (a) the volume weighted average of the closing sales prices of the Common Stock for such day on all
domestic securities exchanges on which the Common Stock may at the time be listed; (b) if there have been no sales of the Common
Stock on any such exchange on any such day, the average of the highest bid and lowest asked prices for the Common Stock on all
such exchanges at the end of such day; (c) if on any such day the Common Stock is not listed on a domestic securities exchange,
the closing sales price of the Common Stock as quoted on Nasdaq, the OTC Bulletin Board or similar quotation system or association
for such day; or (d) if there have been no sales of the Common Stock on Nasdaq, the OTC Bulletin Board or similar quotation system
or association on such day, the average of the highest bid and lowest asked prices for the Common Stock quoted on Nasdaq, the OTC
Bulletin Board or similar quotation system or association at the end of such day; in each case, averaged over twenty (20) consecutive
Business Days ending on the Business Day immediately prior to the day as of which "Fair Market Value" is being determined;
provided, that if the Common Stock is listed on any domestic securities exchange, the term "Business Day" as used
in this sentence means Business Days on which such exchange is open for trading. If at any time the Common Stock is not listed
on any domestic securities exchange or quoted on Nasdaq, the OTC Bulletin Board or similar quotation system or association, the
"Fair Market Value" of the Common Stock shall be the fair market value per share as determined jointly by the Board and
the Holder.

 

"Holder" has the meaning
set forth in the preamble.

 

"Options" means any
warrants or other rights or options to subscribe for or purchase Common Stock or Convertible Securities.

 

"Original Issue Date" means
[DATE].

 

    	3

    	 

    

 

"Nasdaq" means The
Nasdaq Stock Market, Inc.

 

"OTC Bulletin Board" means
the National Association of Securities Dealers, Inc. OTC Bulletin Board.

 

"Person" means an
individual, corporation, partnership, joint venture, limited liability company, governmental authority, unincorporated organization,
trust, association or other entity.

 

"Warrant" means this
Warrant and all warrants issued upon division or combination of, or in substitution for, this Warrant.

 

"Warrant Shares" means
the shares of Common Stock or other capital stock of the Company then purchasable upon exercise of this Warrant in accordance with
the terms of this Warrant.

 

Term of Warrant. Subject to the terms and conditions
hereof, at any time or from time to time after the date hereof and prior to 5:00 p.m., [LOCATION] time, on the fifth (5th)
anniversary of the date hereof or, if such day is not a Business Day, on the next preceding Business Day (the "Exercise
Period"), the Holder of this Warrant may exercise this Warrant for all or any part of the Warrant Shares purchasable hereunder
(subject to adjustment as provided herein).

 

Exercise of Warrant.

 

Exercise Procedure. This Warrant
may be exercised from time to time on any Business Day during the Exercise Period, for all or any part of the unexercised Warrant
Shares, upon:

 

surrender of this Warrant to the Company at
its then principal executive offices (or an indemnification undertaking with respect to this Warrant in the case of its loss, theft
or destruction), together with an Exercise Agreement in the form attached hereto as Exhibit A (each, an "Exercise
Agreement"), duly completed (including specifying the number of Warrant Shares to be purchased) and executed; and

 

payment to the Company of the Aggregate Exercise
Price in accordance with Section 3(b).

 

Payment of the Aggregate Exercise Price.
Payment of the Aggregate Exercise Price shall be made, at the option of the Holder as expressed in the Exercise Agreement, by the
following methods:

 

by delivery to the Company of a certified
or official bank check payable to the order of the Company or by wire transfer of immediately available funds to an account designated
in writing by the Company, in the amount of such Aggregate Exercise Price;

 

    	4

    	 

    

 

by instructing the Company to withhold a number
of Warrant Shares then issuable upon exercise of this Warrant with an aggregate Fair Market Value as of the Exercise Date equal
to such Aggregate Exercise Price;

 

by surrendering to the Company (x) Warrant
Shares previously acquired by the Holder with an aggregate Fair Market Value as of the Exercise Date equal to such Aggregate Exercise
Price and/or (y) other securities of the Company having a value as of the Exercise Date equal to the Aggregate Exercise Price (which
value in the case of debt securities shall be the principal amount thereof plus accrued and unpaid interest, in the case of preferred
stock shall be the liquidation value thereof plus accumulated and unpaid dividends and in the case of shares of Common Stock shall
be the Fair Market Value thereof); or

 

any combination of the foregoing.

 

In the event of any withholding of Warrant Shares or surrender
of other equity securities pursuant to clause (ii), (iii) or (iv) above where the number of shares whose value is equal to the
Aggregate Exercise Price is not a whole number, the number of shares withheld by or surrendered to the Company shall be rounded
up to the nearest whole share and the Company shall make a cash payment to the Holder (by delivery of a certified or official bank
check or by wire transfer of immediately available funds) based on the incremental fraction of a share being so withheld by or
surrendered to the Company in an amount equal to the product of (x) such incremental fraction of a share being so withheld or surrendered
multiplied by (y) in the case of Common Stock, the Fair Market Value per Warrant Share as of the Exercise Date, and, in all other
cases, the value thereof as of the Exercise Date determined in accordance with clause (iii)(y) above.

 

Delivery of Stock Certificates. Upon
receipt by the Company of the Exercise Agreement, surrender of this Warrant and payment of the Aggregate Exercise Price (in accordance
with Section 3(a) hereof), the Company shall, as promptly as practicable, and in any event within ten (10) Business Days
thereafter, execute (or cause to be executed) and deliver (or cause to be delivered) to the Holder a certificate or certificates
representing the Warrant Shares issuable upon such exercise, together with cash in lieu of any fraction of a share, as provided
in Section 3(d) hereof. The stock certificate or certificates so delivered shall be, to the extent possible, in such denomination
or denominations as the exercising Holder shall reasonably request in the Exercise Agreement and shall be registered in the name
of the Holder or, subject to compliance with Section 7 below, such other Person's name as shall be designated in the Exercise
Agreement. This Warrant shall be deemed to have been exercised and such certificate or certificates of Warrant Shares shall be
deemed to have been issued, and the Holder or any other Person so designated to be named therein shall be deemed to have become
a holder of record of such Warrant Shares for all purposes, as of the Exercise Date.

 

    	5

    	 

    

 

Fractional Shares. The Company shall
not be required to issue a fractional Warrant Share upon exercise of any Warrant. As to any fraction of a Warrant Share that the
Holder would otherwise be entitled to purchase upon such exercise, the Company shall pay to such Holder an amount in cash (by delivery
of a certified or official bank check or by wire transfer of immediately available funds) equal to the product of (i) such fraction
multiplied by (ii) the Fair Market Value of one Warrant Share on the Exercise Date.

 

Delivery of New Warrant. Unless the
purchase rights represented by this Warrant shall have expired or shall have been fully exercised, the Company shall, at the time
of delivery of the certificate or certificates representing the Warrant Shares being issued in accordance with Section 3(c)
hereof, deliver to the Holder a new Warrant evidencing the rights of the Holder to purchase the unexpired and unexercised Warrant
Shares called for by this Warrant. Such new Warrant shall in all other respects be identical to this Warrant.

 

Valid Issuance of Warrant and Warrant
Shares; Payment of Taxes. With respect to the exercise of this warrant, the Company hereby represents, covenants and agrees:

 

This Warrant is, and any Warrant issued in
substitution for or replacement of this Warrant shall be, upon issuance, duly authorized and validly issued.

 

All Warrant Shares issuable upon the exercise
of this Warrant pursuant to the terms hereof shall be, upon issuance, and the Company shall take all such actions as may be necessary
or appropriate in order that such Warrant Shares are, validly issued, fully paid and non-assessable, issued without violation of
any pre-emptive or similar rights of any stockholder of the Company and free and clear of all taxes, liens and charges.

 

The Company shall take all such actions as
may be necessary to ensure that all such Warrant Shares are issued without violation by the Company of any applicable law or governmental
regulation or any requirements of any domestic securities exchange upon which shares of Common Stock or other securities constituting
Warrant Shares may be listed at the time of such exercise (except for official notice of issuance which shall be immediately delivered
by the Company upon each such issuance).

 

The Company shall use its best efforts to
cause the Warrant Shares, immediately upon such exercise, to be listed on any domestic securities exchange upon which shares of
Common Stock or other securities constituting Warrant Shares are listed at the time of such exercise.

 

The Company shall pay all expenses in connection
with, and all taxes and other governmental charges that may be imposed with respect to, the issuance or delivery of Warrant Shares
upon exercise of this Warrant; provided, that the Company shall not be required to pay any tax or governmental charge that
may be imposed with respect to any applicable withholding or the issuance or delivery of the Warrant Shares to any Person other
than the Holder, and no such issuance or delivery shall be made unless and until the Person requesting such issuance has paid to
the Company the amount of any such tax, or has established to the satisfaction of the Company that such tax has been paid.

 

    	6

    	 

    

 

Conditional Exercise. Notwithstanding
any other provision hereof, if an exercise of any portion of this Warrant is to be made in connection with a public offering or
a sale of the Company (pursuant to a merger, sale of stock, or otherwise), such exercise may at the election of the Holder be conditioned
upon the consummation of such transaction, in which case such exercise shall not be deemed to be effective until immediately prior
to the consummation of such transaction.

 

Reservation of Shares. During the
Exercise Period, the Company shall at all times reserve and keep available out of its authorized but unissued Common Stock or other
securities constituting Warrant Shares, solely for the purpose of issuance upon the exercise of this Warrant, the maximum number
of Warrant Shares issuable upon the exercise of this Warrant, and the par value per Warrant Share shall at all times be less than
or equal to the applicable Exercise Price. The Company shall not increase the par value of any Warrant Shares receivable upon the
exercise of this Warrant above the Exercise Price then in effect, and 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
this Warrant.

 

Adjustment to Exercise Price and Number of Warrant Shares.
In order to prevent dilution of the purchase rights granted under this Warrant, the Exercise Price and the number of Warrant Shares
issuable upon exercise of this Warrant shall be subject to adjustment from time to time as provided in this Section 4.

 

Adjustment to Exercise Price Upon Issuance
of Common Stock. Except as provided in Section 4(c) and except in the case of an event described in either Section
4(e) or Section 4(f), if the Company shall, at any time or from time to time after the Original Issue Date, issue or
sell, or in accordance with Section 4(d) is deemed to have issued or sold, any shares of Common Stock without consideration
or for consideration per share less than the Exercise Price in effect immediately prior to such issuance or sale (or deemed issuance
or sale), then immediately upon such issuance or sale (or deemed issuance or sale), the Exercise Price in effect immediately prior
to such issuance or sale (or deemed issuance or sale) shall be reduced (and in no event increased) to an Exercise Price equal to
the quotient obtained by dividing:

 

the sum of (A) the product obtained by multiplying
the Common Stock Deemed Outstanding immediately prior to such issuance or sale (or deemed issuance or sale) by the Exercise Price
then in effect plus (B) the aggregate consideration, if any, received by the Company upon such issuance or sale (or deemed issuance
or sale); by

 

    	7

    	 

    

 

the sum of (A) the Common Stock Deemed Outstanding
immediately prior to such issuance or sale (or deemed issuance or sale) plus (B) the aggregate number of shares of Common Stock
issued or sold (or deemed issued or sold) by the Company in such issuance or sale (or deemed issuance or sale).

 

Adjustment to Number of Warrant Shares
Upon Adjustment to Exercise Price. Upon any and each adjustment of the Exercise Price as provided in Section 4(a), the
number of Warrant Shares issuable upon the exercise of this Warrant immediately prior to any such adjustment shall be increased
to a number of Warrant Shares equal to the quotient obtained by dividing:

 

the product of (A) the Exercise Price in effect
immediately prior to any such adjustment multiplied by (B) the number of Warrant Shares issuable upon exercise of this Warrant
immediately prior to any such adjustment; by

 

the Exercise Price resulting from such adjustment.

 

Exceptions To Adjustment Upon Issuance
of Common Stock. Anything herein to the contrary notwithstanding, there shall be no adjustment to the Exercise Price or the
number of Warrant Shares issuable upon exercise of this Warrant with respect to any Excluded Issuance.

 

Effect of Certain Events on Adjustment
to Exercise Price. For purposes of determining the adjusted Exercise Price under Section 4(a) hereof, the following
shall be applicable:

 

Issuance of Options. If the Company
shall, at any time or from time to time after the Original Issue Date, in any manner grant or sell (whether directly or by assumption
in a merger or otherwise) any Options, whether or not such Options or the right to convert or exchange any Convertible Securities
issuable upon the exercise of such Options are immediately exercisable, and the price per share (determined as provided in this
paragraph and in Section 4(d)(v) ) for which Common Stock is issuable upon the exercise of such Options or upon the conversion
or exchange of Convertible Securities issuable upon the exercise of such Options is less than the Exercise Price in effect immediately
prior to the time of the granting or sale of such Options, then the total maximum number of shares of Common Stock issuable upon
the exercise of such Options or upon conversion or exchange of the total maximum amount of Convertible Securities issuable upon
the exercise of such Options shall be deemed to have been issued as of the date of granting or sale of such Options (and thereafter
shall be deemed to be outstanding for purposes of adjusting the Exercise Price under Section 4(a)), at a price per share
equal to the quotient obtained by dividing (A) the sum (which sum shall constitute the applicable consideration received for purposes
of Section 4(a)) of (x) the total amount, if any, received or receivable by the Company as consideration for the granting
or sale of all such Options, plus (y) the minimum aggregate amount of additional consideration payable to the Company upon the
exercise of all such Options, plus (z), in the case of such Options which relate to Convertible Securities, the minimum aggregate
amount of additional consideration, if any, payable to the Company upon the issuance or sale of all such Convertible Securities
and the conversion or exchange of all such Convertible Securities, by (B) the total maximum number of shares of Common Stock issuable
upon the exercise of all such Options or upon the conversion or exchange of all Convertible Securities issuable upon the exercise
of all such Options. Except as otherwise provided in Section 4(d)(iii), no further adjustment of the Exercise Price shall be made
upon the actual issuance of Common Stock or of Convertible Securities upon exercise of such Options or upon the actual issuance
of Common Stock upon conversion or exchange of Convertible Securities issuable upon exercise of such Options.

 

    	8

    	 

    

 

Issuance of Convertible Securities.
If the Company shall, at any time or from time to time after the Original Issue Date, in any manner grant or sell (whether directly
or by assumption in a merger or otherwise) any Convertible Securities, whether or not the right to convert or exchange any such
Convertible Securities is immediately exercisable, and the price per share (determined as provided in this paragraph and in Section
4(d)(v) ) for which Common Stock is issuable upon the conversion or exchange of such Convertible Securities is less than the Exercise
Price in effect immediately prior to the time of the granting or sale of such Convertible Securities, then the total maximum number
of shares of Common Stock issuable upon conversion or exchange of the total maximum amount of such Convertible Securities shall
be deemed to have been issued as of the date of granting or sale of such Convertible Securities (and thereafter shall be deemed
to be outstanding for purposes of adjusting the Exercise Price pursuant to Section 4(a)), at a price per share equal to
the quotient obtained by dividing (A) the sum (which sum shall constitute the applicable consideration received for purposes of
Section 4(a)) of (x) the total amount, if any, received or receivable by the Company as consideration for the granting or
sale of such Convertible Securities, plus (y) the minimum aggregate amount of additional consideration, if any, payable to the
Company upon the conversion or exchange of all such Convertible Securities, by (B) the total maximum number of shares of Common
Stock issuable upon the conversion or exchange of all such Convertible Securities. Except as otherwise provided in Section 4(d)(iii),
(A) no further adjustment of the Exercise Price shall be made upon the actual issuance of Common Stock upon conversion or exchange
of such Convertible Securities and (B) no further adjustment of the Exercise Price shall be made by reason of the issue or sale
of Convertible Securities upon exercise of any Options to purchase any such Convertible Securities for which adjustments of the
Exercise Price have been made pursuant to the other provisions of this Section 4(d).

 

Change in Terms of Options or Convertible
Securities. Upon any change in any of (A) the total amount received or receivable by the Company as consideration for the granting
or sale of any Options or Convertible Securities referred to in Section 4(d)(i) or Section 4(d)(ii) hereof, (B) the minimum aggregate
amount of additional consideration, if any, payable to the Company upon the exercise of any Options or upon the issuance, conversion
or exchange of any Convertible Securities referred to in Section 4(d)(i) or Section 4(d)(ii) hereof, (C) the rate at which Convertible
Securities referred to in Section 4(d)(i) or Section 4(d)(ii) hereof are convertible into or exchangeable for Common Stock, or
(D) the maximum number of shares of Common Stock issuable in connection with any Options referred to in Section 4(d)(i) hereof
or any Convertible Securities referred to in Section 4(d)(ii) hereof (in each case, other than in connection with an Excluded Issuance),
then (whether or not the original issuance or sale of such Options or Convertible Securities resulted in an adjustment to the Exercise
Price pursuant to this Section 4) the Exercise Price in effect at the time of such change shall be adjusted or readjusted,
as applicable, to the Exercise Price which would have been in effect at such time pursuant to the provisions of this Section
4 had such Options or Convertible Securities still outstanding provided for such changed consideration, conversion rate or
maximum number of shares, as the case may be, at the time initially granted, issued or sold, but only if as a result of such adjustment
or readjustment the Exercise Price then in effect is reduced, and the number of Warrant Shares issuable upon the exercise of this
Warrant immediately prior to any such adjustment or readjustment shall be correspondingly adjusted or readjusted pursuant to the
provisions of Section 4(b).

 

    	9

    	 

    

 

Treatment of Expired or Terminated Options
or Convertible Securities. Upon the expiration or termination of any unexercised Option (or portion thereof) or any unconverted
or unexchanged Convertible Security (or portion thereof) for which any adjustment (either upon its original issuance or upon a
revision of its terms) was made pursuant to this Section 4 (including without limitation upon the redemption or purchase
for consideration of all or any portion of such Option or Convertible Security by the Company), the Exercise Price then in effect
hereunder shall forthwith be changed pursuant to the provisions of this Section 4 to the Exercise Price which would have
been in effect at the time of such expiration or termination had such unexercised Option (or portion thereof) or unconverted or
unexchanged Convertible Security (or portion thereof), to the extent outstanding immediately prior to such expiration or termination,
never been issued.

 

Calculation of Consideration Received.
If the Company shall, at any time or from time to time after the Original Issue Date, issue or sell, or is deemed to have issued
or sold in accordance with Section 4(d), any shares of Common Stock, Options or Convertible Securities: (A) for cash, the
consideration received therefor shall be deemed to be the net amount received by the Company therefor; (B) for consideration other
than cash, the amount of the consideration other than cash received by the Company shall be the fair value of such consideration,
except where such consideration consists of marketable securities, in which case the amount of consideration received by the Company
shall be the market price (as reflected on any securities exchange, quotation system or association or similar pricing system covering
such security) for such securities as of the end of business on the date of receipt of such securities; (C) for no specifically
allocated consideration in connection with an issuance or sale of other securities of the Company, together comprising one integrated
transaction, the amount of the consideration therefor shall be deemed to be the fair value of such portion of the aggregate consideration
received by the Company in such transaction as is attributable to such shares of Common Stock, Options or Convertible Securities,
as the case may be, issued in such transaction; or (D) to the owners of the non-surviving entity in connection with any merger
in which the Company is the surviving corporation, the amount of consideration therefor shall be deemed to be the fair value of
such portion of the net assets and business of the non-surviving entity as is attributable to such shares of Common Stock, Options
or Convertible Securities, as the case may be, issued to such owners. The net amount of any cash consideration and the fair value
of any consideration other than cash or marketable securities shall be determined in good faith jointly by the Board and the Holder.

 

    	10

    	 

    

 

Record Date. For purposes of any adjustment
to the Exercise Price or the number of Warrant Shares in accordance with this Section 4, in case the Company shall take
a record of the holders of its Common Stock for the purpose of entitling them (A) to receive a dividend or other distribution payable
in Common Stock, Options or Convertible Securities or (B) to subscribe for or purchase Common Stock, Options or Convertible Securities,
then such record date shall be deemed to be the date of the issue or sale of the shares of Common Stock deemed to have been issued
or sold upon the declaration of such dividend or the making of such other distribution or the date of the granting of such right
of subscription or purchase, as the case may be.

 

Treasury Shares. The number of shares
of Common Stock outstanding at any given time shall not include shares owned or held by or for the account of the Company or any
of its wholly-owned subsidiaries, and the disposition of any such shares (other than the cancellation or retirement thereof or
the transfer of such shares among the Company and its wholly-owned subsidiaries) shall be considered an issue or sale of Common
Stock for the purpose of this Section 4.

 

Adjustment to Exercise Price and Warrant
Shares Upon Dividend, Subdivision or Combination of Common Stock. If the Company shall, at any time or from time to time after
the Original Issue Date, (i) pay a dividend or make any other distribution upon the Common Stock or any other capital stock of
the Company payable in shares of Common Stock or in Options or Convertible Securities, or (ii) subdivide (by any stock split, recapitalization
or otherwise) its outstanding shares of Common Stock into a greater number of shares, the Exercise Price in effect immediately
prior to any such dividend, distribution or subdivision shall be proportionately reduced and the number of Warrant Shares issuable
upon exercise of this Warrant shall be proportionately increased. If the Company at any time combines (by combination, reverse
stock split or otherwise) its outstanding shares of Common Stock into a smaller number of shares, the Exercise Price in effect
immediately prior to such combination shall be proportionately increased and the number of Warrant Shares issuable upon exercise
of this Warrant shall be proportionately decreased. Any adjustment under this Section 4(e) shall become effective at the
close of business on the date the dividend, subdivision or combination becomes effective.

 

    	11

    	 

    

 

Adjustment to Exercise Price and Warrant
Shares Upon Reorganization, Reclassification, Consolidation or Merger. In the event of any (i) capital reorganization of the
Company, (ii) reclassification of the stock of the Company (other than a change in par value or from par value to no par value
or from no par value to par value or as a result of a stock dividend or subdivision, split-up or combination of shares), (iii)
consolidation or merger of the Company with or into another Person, (iv) sale of all or substantially all of the Company's assets
to another Person or (v) other similar transaction (other than any such transaction covered by Section 4(e)), in each case
which entitles the holders of Common Stock to receive (either directly or upon subsequent liquidation) stock, securities or assets
with respect to or in exchange for Common Stock, each Warrant shall, immediately after such reorganization, reclassification, consolidation,
merger, sale or similar transaction, remain outstanding and shall thereafter, in lieu of or in addition to (as the case may be)
the number of Warrant Shares then exercisable under this Warrant, be exercisable for the kind and number of shares of stock or
other securities or assets of the Company or of the successor Person resulting from such transaction to which the Holder would
have been entitled upon such reorganization, reclassification, consolidation, merger, sale or similar transaction if the Holder
had exercised this Warrant in full immediately prior to the time of such reorganization, reclassification, consolidation, merger,
sale or similar transaction and acquired the applicable number of Warrant Shares then issuable hereunder as a result of such exercise
(without taking into account any limitations or restrictions on the exercisability of this Warrant); and, in such case, appropriate
adjustment (in form and substance satisfactory to the Holder) shall be made with respect to the Holder's rights under this Warrant
to insure that the provisions of this Section 4 hereof shall thereafter be applicable, as nearly as possible, to this Warrant
in relation to any shares of stock, securities or assets thereafter acquirable upon exercise of this Warrant (including, in the
case of any consolidation, merger, sale or similar transaction in which the successor or purchasing Person is other than the Company,
an immediate adjustment in the Exercise Price to the value per share for the Common Stock reflected by the terms of such consolidation,
merger, sale or similar transaction, and a corresponding immediate adjustment to the number of Warrant Shares acquirable upon exercise
of this Warrant without regard to any limitations or restrictions on exercise, if the value so reflected is less than the Exercise
Price in effect immediately prior to such consolidation, merger, sale or similar transaction). The provisions of this Section
4(f) shall similarly apply to successive reorganizations, reclassifications, consolidations, mergers, sales or similar transactions.
The Company shall not effect any such reorganization, reclassification, consolidation, merger, sale or similar transaction unless,
prior to the consummation thereof, the successor Person (if other than the Company) resulting from such reorganization, reclassification,
consolidation, merger, sale or similar transaction, shall assume, by written instrument substantially similar in form and substance
to this Warrant and satisfactory to the Holder, the obligation to deliver to the Holder such shares of stock, securities or assets
which, in accordance with the foregoing provisions, such Holder shall be entitled to receive upon exercise of this Warrant. Notwithstanding
anything to the contrary contained herein, with respect to any corporate event or other transaction contemplated by the provisions
of this Section 4(f), the Holder shall have the right to elect prior to the consummation of such event or transaction, to
give effect to the exercise rights contained in Section 2 instead of giving effect to the provisions contained in this Section
4(f) with respect to this Warrant.

 

    	12

    	 

    

 

Certain Events. If any event of the
type contemplated by the provisions of this Section 4 but not expressly provided for by such provisions (including, without
limitation, the granting of stock appreciation rights, phantom stock rights or other rights with equity features) occurs, then
the Board shall make an appropriate adjustment in the Exercise Price and the number of Warrant Shares issuable upon exercise of
this Warrant so as to protect the rights of the Holder in a manner consistent with the provisions of this Section 4; provided,
that no such adjustment pursuant to this Section 4(g) shall increase the Exercise Price or decrease the number of Warrant
Shares issuable as otherwise determined pursuant to this Section 4.

 

Certificate as to Adjustment.

 

As promptly as reasonably practicable following
any adjustment of the Exercise Price, but in any event not later than ten (10) Business Days thereafter, the Company shall furnish
to the Holder a certificate of an executive officer setting forth in reasonable detail such adjustment and the facts upon which
it is based and certifying the calculation thereof.

 

As promptly as reasonably practicable following
the receipt by the Company of a written request by the Holder, but in any event not later than ten (10) Business Days thereafter,
the Company shall furnish to the Holder a certificate of an executive officer certifying the Exercise Price then in effect and
the number of Warrant Shares or the amount, if any, of other shares of stock, securities or assets then issuable upon exercise
of the Warrant.

 

Notices. In the event:

 

of any capital reorganization of the Company,
any reclassification of the Common Stock of the Company, any consolidation or merger of the Company with or into another Person,
or sale of all or substantially all of the Company's assets to another Person; or

 

of the voluntary or involuntary dissolution,
liquidation or winding-up of the Company;

 

then, and in each such case, the Company
shall send or cause to be sent to the Holder at least five (5) days prior to the applicable record date or the applicable expected
effective date, as the case may be, for the event, a written notice specifying, as the case may be, (A) the record date for such
dividend, distribution, meeting or consent or other right or action, and a description of such dividend, distribution or other
right or action to be taken at such meeting or by written consent, or (B) the effective date on which such reorganization, reclassification,
consolidation, merger, sale, dissolution, liquidation or winding-up is proposed to take place, and the date, if any is to be fixed,
as of which the books of the Company shall close or a record shall be taken with respect to which the holders of record of Common
Stock (or such other capital stock or securities at the time issuable upon exercise of the Warrant) shall be entitled to exchange
their shares of Common Stock (or such other capital stock or securities) for securities or other property deliverable upon such
reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation or winding-up, and the amount per share
and character of such exchange applicable to the Warrant and the Warrant Shares.

 

    	13

    	 

    

 

Purchase Rights. In addition to any adjustments pursuant
to Section 4 above, if at any time the Company grants, issues or sells any shares of Common Stock, Options, Convertible
Securities or rights to purchase stock, warrants, securities or other property pro rata to the record holders of Common Stock (the
"Purchase Rights"), then the Holder shall be entitled to acquire, upon the terms applicable to such Purchase Rights,
the aggregate Purchase Rights which the Holder would have acquired if the Holder had held the number of Warrant Shares acquirable
upon complete exercise of this Warrant immediately before the date on which a record is taken for the grant, issuance or sale of
such Purchase Rights, or, if no such record is taken, the date as of which the record holders of Common Stock are to be determined
for the grant, issue or sale of such Purchase Rights. Anything herein to the contrary notwithstanding, the Holder shall not be
entitled to the Purchase Rights granted herein with respect to any Excluded Issuance.

 

Transfer of Warrant. The Holder may not transfer, sell,
assign, pledge, hypothecate or otherwise dispose of this Warrant without the consent of the Company.

 

Holder Not Deemed a Stockholder; Limitations on Liability.
Except as otherwise specifically provided herein, prior to the issuance to the Holder of the Warrant Shares to which the Holder
is then entitled to receive upon the due exercise of this Warrant, the Holder shall not be entitled to vote or receive dividends
or be deemed the holder of shares of capital stock of the Company for any purpose, nor shall anything contained in this Warrant
be construed to confer upon the Holder, as such, 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. In addition,
nothing contained in this Warrant shall be construed as imposing any liabilities on the Holder to purchase any securities (upon
exercise of this Warrant or otherwise) or as a stockholder of the Company, whether such liabilities are asserted by the Company
or by creditors of the Company.

 

Replacement on Loss; Division and Combination.

 

Replacement of Warrant on Loss. Upon
receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant and upon
delivery of an indemnity reasonably satisfactory to it (it being understood that a written indemnification agreement or affidavit
of loss of the Holder shall be a sufficient indemnity) and, in case of mutilation, upon surrender of such Warrant for cancellation
to the Company, the Company at its own expense shall execute and deliver to the Holder, in lieu hereof, a new Warrant of like tenor
and exercisable for an equivalent number of Warrant Shares as the Warrant so lost, stolen, mutilated or destroyed; provided,
that, in the case of mutilation, no indemnity shall be required if this Warrant in identifiable form is surrendered to the Company
for cancellation.

 

    	14

    	 

    

 

Division and Combination of Warrant.
Subject to compliance with the applicable provisions of this Warrant and the Stockholders Agreement as to any transfer or other
assignment which may be involved in such division or combination, this Warrant may be divided or, following any such division of
this Warrant, subsequently combined with other Warrants, upon the surrender of this Warrant or Warrants to the Company at its then
principal executive offices, together with a written notice specifying the names and denominations in which new Warrants are to
be issued, signed by the respective Holders or their agents or attorneys. Subject to compliance with the applicable provisions
of this Warrant and the Stockholders Agreement as to any transfer or assignment which may be involved in such division or combination,
the Company shall at its own expense execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants so surrendered
in accordance with such notice. Such new Warrant or Warrants shall be of like tenor to the surrendered Warrant or Warrants and
shall be exercisable in the aggregate for an equivalent number of Warrant Shares as the Warrant or Warrants so surrendered in accordance
with such notice.

 

Compliance with the Securities Act.

 

Agreement to Comply with the Securities
Act; Legend. The Holder, by acceptance of this Warrant, agrees to comply in all respects with the provisions of this Section
9 and the restrictive legend requirements set forth on the face of this Warrant and further agrees that such Holder shall not
offer, sell or otherwise dispose of this Warrant or any Warrant Shares to be issued upon exercise hereof except under circumstances
that will not result in a violation of the Securities Act of 1933, as amended (the "Securities Act"). This Warrant
and all Warrant Shares issued upon exercise of this Warrant (unless registered under the Securities Act) shall be stamped or imprinted
with a legend in substantially the following form:

 

"THIS WARRANT AND THE SECURITIES ISSUABLE
UPON EXERCISE OF THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR QUALIFIED
UNDER ANY STATE OR FOREIGN SECURITIES LAWS AND MAY NOT BE OFFERED FOR SALE, SOLD, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED
OR ASSIGNED UNLESS (I) A REGISTRATION STATEMENT COVERING SUCH SHARES IS EFFECTIVE UNDER THE ACT AND IS QUALIFIED UNDER APPLICABLE
STATE AND FOREIGN LAW OR (II) THE TRANSACTION IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS UNDER THE ACT
AND THE QUALIFICATION REQUIREMENTS UNDER APPLICABLE STATE AND FOREIGN LAW AND, IF THE CORPORATION REQUESTS, AN OPINION SATISFACTORY
TO THE CORPORATION TO SUCH EFFECT HAS BEEN RENDERED BY COUNSEL."

 

    	15

    	 

    

 

Representations of the Holder. In
connection with the issuance of this Warrant, the Holder specifically represents, as of the date hereof, to the Company by acceptance
of this Warrant as follows:

 

The Holder is an "accredited investor"
as defined in Rule 501 of Regulation D promulgated under the Securities Act. The Holder is acquiring this Warrant and the Warrant
Shares to be issued upon exercise hereof for investment for its own account and not with a view towards, or for resale in connection
with, the public sale or distribution of this Warrant or the Warrant Shares, except pursuant to sales registered or exempted under
the Securities Act.

 

The Holder understands and acknowledges that
this Warrant and the Warrant Shares to be issued upon exercise hereof are "restricted securities" under the federal securities
laws inasmuch as they are being acquired from the Company in a transaction not involving a public offering and that, under such
laws and applicable regulations, such securities may be resold without registration under the Securities Act only in certain limited
circumstances. In addition, the Holder represents that it is familiar with Rule 144 under the Securities Act, as presently in effect,
and understands the resale limitations imposed thereby and by the Securities Act.

 

The Holder acknowledges that it can bear the
economic and financial risk of its investment for an indefinite period, and has such knowledge and experience in financial or business
matters that it is capable of evaluating the merits and risks of the investment in the Warrant and the Warrant Shares. The Holder
has had an opportunity to ask questions and receive answers from the Company regarding the terms and conditions of the offering
of the Warrant and the business, properties, prospects and financial condition of the Company.

 

Warrant Register. The Company shall keep and properly
maintain at its principal executive offices books for the registration of the Warrant and any transfers thereof. The Company may
deem and treat the Person in whose name the Warrant is registered on such register as the Holder thereof for all purposes, and
the Company shall not be affected by any notice to the contrary, except any assignment, division, combination or other transfer
of the Warrant effected in accordance with the provisions of this Warrant.

 

Notices. All notices, requests, consents, claims, demands,
waivers and other communications hereunder shall be in writing and shall be deemed to have been given: (a) when delivered by hand
(with written confirmation of receipt); (b) when received by the addressee if sent by a nationally recognized overnight courier
(receipt requested); (c) on the date sent by facsimile or e-mail of a PDF document (with confirmation of transmission) if sent
during normal business hours of the recipient, and on the next Business Day if sent after normal business hours of the recipient;
or (d) on the [third] day after the date mailed, by certified or registered mail, return receipt requested, postage prepaid. Such
communications must be sent to the respective parties at the addresses indicated below (or at such other address for a party as
shall be specified in a notice given in accordance with this Section 13).

 

    	16

    	 

    

 

	If to the Company:	[COMPANY ADDRESS]
	 	 
	If to the Holder:	[HOLDER ADDRESS] 

 

Cumulative Remedies. Except to the extent expressly provided
in Section 8 to the contrary, the rights and remedies provided in this Warrant are cumulative and are not exclusive of,
and are in addition to and not in substitution for, any other rights or remedies available at law, in equity or otherwise.

 

Equitable Relief. Each of the Company and the Holder
acknowledges that a breach or threatened breach by such party of any of its obligations under this Warrant would give rise to irreparable
harm to the other party hereto for which monetary damages would not be an adequate remedy and hereby agrees that in the event of
a breach or a threatened breach by such party of any such obligations, the other party hereto shall, in addition to any and all
other rights and remedies that may be available to it in respect of such breach, be entitled to equitable relief, including a restraining
order, an injunction, specific performance and any other relief that may be available from a court of competent jurisdiction.

 

Entire Agreement. This Warrant, together with the Stockholders
Agreement and the Purchase Agreement, constitutes the sole and entire agreement of the parties to this Warrant with respect to
the subject matter contained herein, and supersedes all prior and contemporaneous understandings and agreements, both written and
oral, with respect to such subject matter. In the event of any inconsistency between the statements in the body of this Warrant,
the Stockholders Agreement and the Purchase Agreement, the statements in the body of this Warrant shall control.

 

Successor and Assigns. This Warrant and the rights evidenced
hereby shall be binding upon and shall inure to the benefit of the parties hereto and the successors of the Company and the successors
and permitted assigns of the Holder. Such successors and/or permitted assigns of the Holder shall be deemed to be a Holder for
all purposes hereunder.

 

No Third-Party Beneficiaries. This Warrant is for the
sole benefit of the Company and the Holder and their respective successors and, in the case of the Holder, permitted assigns and
nothing herein, express or implied, is intended to or shall confer upon any other Person any legal or equitable right, benefit
or remedy of any nature whatsoever, under or by reason of this Warrant.

 

    	17

    	 

    

 

Headings. The headings in this Warrant are for reference
only and shall not affect the interpretation of this Warrant.

 

Amendment and Modification; Waiver. Except as otherwise
provided herein, this Warrant may only be amended, modified or supplemented by an agreement in writing signed by each party hereto.
No waiver by the Company or the Holder of any of the provisions hereof shall be effective unless explicitly set forth in writing
and signed by the party so waiving. No waiver by any party shall operate or be construed as a waiver in respect of any failure,
breach or default not expressly identified by such written waiver, whether of a similar or different character, and whether occurring
before or after that waiver. No failure to exercise, or delay in exercising, any rights, remedy, power or privilege arising from
this Warrant shall operate or be construed as a waiver thereof; nor shall any single or partial exercise of any right, remedy,
power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or
privilege.

 

Severability. If any term or provision of this Warrant
is invalid, illegal or unenforceable in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any
other term or provision of this Warrant or invalidate or render unenforceable such term or provision in any other jurisdiction.

 

Governing Law. This Warrant shall be governed by and
construed in accordance with the internal laws of the State of Delaware without giving effect to any choice or conflict of law
provision or rule (whether of the State of Delaware or any other jurisdiction) that would cause the application of laws of any
jurisdiction other than those of the State of Delaware.

 

Submission to Jurisdiction. Any legal suit, action or
proceeding arising out of or based upon this Warrant or the transactions contemplated hereby may be instituted in the federal courts
of the United States of America or the courts of the State of Delaware, and each party irrevocably submits to the exclusive jurisdiction
of such courts in any such suit, action or proceeding. Service of process, summons, notice or other document by certified or registered
mail to such party's address set forth herein shall be effective service of process for any suit, action or other proceeding brought
in any such court. The parties irrevocably and unconditionally waive any objection to the laying of venue of any suit, action or
any proceeding in such courts and irrevocably waive and agree not to plead or claim in any such court that any such suit, action
or proceeding brought in any such court has been brought in an inconvenient forum.

 

Waiver of Jury Trial. Each party acknowledges and agrees
that any controversy which may arise under this Warrant is likely to involve complicated and difficult issues and, therefore, each
such party irrevocably and unconditionally waives any right it may have to a trial by jury in respect of any legal action arising
out of or relating to this Warrant or the transactions contemplated hereby.

 

    	18

    	 

    

 

Counterparts. This Warrant may be executed in counterparts,
each of which shall be deemed an original, but all of which together shall be deemed to be one and the same agreement. A signed
copy of this Warrant delivered by facsimile, e-mail or other means of electronic transmission shall be deemed to have the same
legal effect as delivery of an original signed copy of this Warrant.

 

No Strict Construction. This Warrant shall be construed
without regard to any presumption or rule requiring construction or interpretation against the party drafting an instrument or
causing any instrument to be drafted.

 

[SIGNATURE PAGE FOLLOWS]

 

    	19

    	 

    

 

IN WITNESS WHEREOF, the Company has duly
executed this Warrant on the Original Issue Date.

 

	 	1347 PROPERTY INSURANCE HOLDINGS, INC.
	 	 	 
	 	By: 	 
	 	Name:
	 	Title:

 

	Accepted and agreed,
	 
	[HOLDER NAME]	 
	 	 	 
	By: 	 	 
	Name:	 
	Title:	 

 

    	20

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