Form 8-K
8-K — Cycurion, Inc.
Accession: 0001493152-26-035854
Filed: 2026-08-03
Period: 2026-08-03
CIK: 0001868419
SIC: 7371 (SERVICES-COMPUTER PROGRAMMING SERVICES)
Item: Entry into a Material Definitive Agreement
Item: Unregistered Sales of Equity Securities
Item: Other Events
Item: Financial Statements and Exhibits
Documents
8-K — form8-k.htm (Primary)
EX-4.1 (ex4-1.htm)
EX-10.1 (ex10-1.htm)
EX-99.1 (ex99-1.htm)
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2026-08-03
2026-08-03
0001868419
CYCU:RedeemableWarrantsEachExercisableForOneShareOfCommonStockAtExercisePriceOf345.00PerShareMember
2026-08-03
2026-08-03
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UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
DC 20549
FORM
8-K
CURRENT
REPORT
PURSUANT
TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
Date
of report (Date of earliest event reported): August 3, 2026 ( July
30, 2026)
Cycurion,
Inc.
(Exact
Name of Registrant as Specified in Its Charter)
Delaware
001-41214
86-3720717
(State
or other jurisdiction
of incorporation)
(Commission
File Number)
(IRS
Employer
Identification No.)
1640
Boro Place, Suite 420C McLean,Virginia
22102
(Address
of principal executive offices)
(Zip
Code)
Registrant’s
telephone number, including area code: (888) 341-6680
Check
the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under
any of the following provisions:
☐
Written
communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities
registered pursuant to Section 12(b) of the Act:
Title
of each class
Trading
Symbol
Name
of each exchange on which registered
Common
stock, par value $0.0001 per share
CYCU
The
NASDAQ Stock Market LLC
Redeemable
warrants, each exercisable for one share of common stock at an exercise price of $345.00 per share
CYCUW
The
NASDAQ Stock Market
Indicate
by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405
of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging
growth company ☒
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item
1.01 Entry into a Material Definitive Agreement.
On
July 30, 2026, Cycurion, Inc. (the “Company”) entered into a warrant inducement agreement (the “Inducement Agreement”)
with a holder (the “Holder”), pursuant to which the Holder agreed to exercise for cash certain existing warrants issued
on December 5, 2025 (the “Existing Warrants”) to purchase an aggregate of 3,341,439 shares of the Company’s common
stock.
Pursuant
to the Inducement Agreement, the Company agreed to reduce the exercise price of the Existing Warrants from $3.62 per share to $1.35 per
share solely with respect to the exercise contemplated by the Inducement Agreement. Upon exercise of the Existing Warrants, the Company
expects to receive aggregate gross proceeds of approximately $4.5 million before payment of financial advisory fees and other offering
expenses.
As
consideration for the immediate exercise of the Existing Warrants, the Company agreed to issue to the Holder in a private placement new
unregistered warrants (the “New Warrants”) to purchase up to 5,012,159 shares of the Company’s common stock, representing
150% of the number of shares underlying the exercised Existing Warrants.
The
New Warrants will have an exercise price of $1.65 per share, will become exercisable upon receipt of stockholder approval as may be required
under applicable Nasdaq rules, and will expire on the fifth anniversary of the date such stockholder approval is obtained. The New Warrants
contain customary anti-dilution adjustments, cashless exercise provisions and beneficial ownership limitations of 4.99% (subject to increase
to 9.99% upon notice by the holder).
The
Company agreed to file a registration statement covering the resale of the shares issuable upon exercise of the New Warrants within 90
calendar days following July 30, 2026, and to use commercially reasonable efforts to cause such registration statement to become
effective within specified periods set forth in the Inducement Agreement. The shares of common stock issued upon exercise of the Existing
Warrants are eligible for resale by the Holder pursuant to Rule 144 under the Securities Act of 1933, as amended (the “Securities
Act”).
The
closing of the transaction took place on August 3, 2026.
The
foregoing description of the Inducement Agreement and the New Warrants does not purport to be complete and is qualified in its entirety
by reference to the full text of the Inducement Agreement and New Warrant, copies of which are filed as Exhibits 10.1 and 4.1,
respectively, to this Current Report on Form 8-K and are incorporated herein by reference.
In
connection with the transaction, the Company entered into a Financial Advisory Agreement with A.G.P./Alliance Global Partners (“A.G.P.”),
pursuant to which A.G.P. acted as exclusive financial advisor. Under the Financial Advisory Agreement, the Company agreed to pay A.G.P.
a cash fee equal to 6.0% of the aggregate gross proceeds raised in the transaction and an additional fee of $200,000 relating to prior
financial advisory services, together with reimbursement of certain legal expenses up to $45,000.
Item
3.02 Unregistered Sales of Equity Securities.
The
information set forth in Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.
The
New Warrants and the shares of common stock issuable upon exercise thereof have not been registered under the Securities Act, and are
being offered and sold in reliance upon the exemption from registration afforded by Section 4(a)(2) of the Securities Act and Regulation
D promulgated thereunder. The Holder represented that it is an accredited investor and acquired the New Warrants for investment purposes
and not with a view toward distribution.
Item
8.01 Other Events.
On
July 31, 2026, the Company issued a press release announcing the warrant inducement transaction described in Item 1.01 of this Current
Report on Form 8-K. A copy of the press release is furnished as Exhibit 99.1 hereto.
This
Current Report on Form 8-K does not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there
be any sale of such securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.
Item
9.01 Financial Statements and Exhibits
(d)
Exhibits:
Exhibit
No.
Description
4.1
Common Stock Purchase Warrant
10.1
Warrant
Inducement Agreement, dated July 30, 2026, by and between Cycurion, Inc. and the Holder.
99.1
Press Release dated July 31, 2026.
104
Cover
Page Interactive Data File (embedded within the Inline XBRL document).
SIGNATURES
Pursuant
to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
CYCURION,
INC.
Date:
August 3, 2026
By:
/s/
L. Kevin Kelly
Name:
L.
Kevin Kelly
Title:
Chief
Executive Officer
EX-4.1
EX-4.1
Filename: ex4-1.htm · Sequence: 2
Exhibit
4.1
NEITHER
THIS SECURITY NOR THE SECURITIES FOR WHICH THIS SECURITY IS EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION
OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. THIS SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE
OF THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT WITH A REGISTERED BROKER-DEALER OR OTHER LOAN WITH A FINANCIAL
INSTITUTION THAT IS AN “ACCREDITED INVESTOR” AS DEFINED IN RULE 501(A) UNDER THE SECURITIES ACT OR OTHER LOAN SECURED BY
SUCH SECURITIES.
COMMON
STOCK PURCHASE WARRANT
CYCURION,
INC.
Warrant
Shares: 5,012,159
Issue
Date: August 3, 2026
THIS
COMMON STOCK PURCHASE WARRANT (the “Warrant”) certifies that, for value received, Armistice Capital Master Fund Ltd.
or its assigns (the “Holder”) is entitled, upon the terms and subject to the limitations on exercise and the conditions
hereinafter set forth, at any time or times on or after the Stockholder Approval Date (the “Initial Exercise Date”)
and on or prior to 5:00 p.m. (New York City time) on the five-year anniversary of the Initial Exercise Date (the “Termination
Date”) but not thereafter, to subscribe for and purchase from CYCURION, INC., a Delaware corporation (the “Company”),
up to 5,012,159 shares of common stock, par value $0.0001 per share (the “Common Stock”) (as subject to adjustment
hereunder, the “Warrant Shares”). The purchase price of one share of Common Stock under this Warrant shall be equal
to the Exercise Price, as defined in Section 2(b).
Section
1. Definitions. Capitalized terms used and not otherwise defined herein shall have the meanings set forth in that certain
Warrant Inducement Agreement (the “Inducement Agreement”), dated July 30, 2026, between the Company and each purchaser
signatory thereto.
Section
2. Exercise
(a)
Exercise of Warrant. Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time
or times on or after the Initial Exercise Date (or the Stockholder Approval Date for the Warrants) and on or before the Termination Date
by delivery to the Company of a duly executed facsimile copy or PDF copy submitted by e-mail (or e-mail attachment) of the Notice of
Exercise in the form annexed hereto as Exhibit A (the “Notice of Exercise”). Within the earlier of (i)
one (1) Trading Day and (ii) the number of Trading Days comprising the Standard Settlement Period (as defined in Section 2(d)(i)
herein) following the date of exercise as aforesaid, the Holder shall deliver the aggregate Exercise Price for the number of Warrant
Shares specified in the applicable Notice of Exercise by wire transfer or cashier’s check drawn on a United States bank unless
the cashless exercise procedure specified in Section 2(c) below is specified in the applicable Notice of Exercise. No ink-original
Notice of Exercise shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of
Exercise be required. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this
Warrant to the Company until the Holder has purchased all of the Warrant Shares available hereunder and the Warrant has been exercised
in full, at which time, the Holder shall surrender this Warrant to the Company for cancellation within three (3) Trading Days of the
date on which the final Notice of Exercise is delivered to the Company. Partial exercises of this Warrant resulting in purchases of a
portion of the total number of Warrant Shares purchasable hereunder shall have the effect of lowering the outstanding number of Warrant
Shares purchasable hereunder by the number of Warrant Shares equal to the applicable number of Warrant Shares purchased in connection
with such partial exercise. The Holder and the Company shall maintain records showing the number of Warrant Shares purchased and the
date of such purchases. The Company shall deliver any objection to any Notice of Exercise within one (1) Trading Day of receipt of such
notice. The Holder and any assignee, by acceptance of this Warrant, acknowledge and agree that, by reason of the provisions of this paragraph,
following the purchase of a portion of the Warrant Shares hereunder, the number of Warrant Shares available for purchase hereunder at
any given time may be less than the amount stated on the face hereof.
(b)
Exercise Price. The exercise price per share of Common Stock under this Warrant shall be $1.65, subject to adjustment hereunder
(the “Exercise Price”).
(c)
Cashless Exercise. Notwithstanding anything to the contrary set forth herein, if at the time of exercise hereof there is no effective
registration statement registering, or the prospectus contained therein is not available for the issuance of, the Warrant Shares to the
Holder, then this Warrant may only be exercised, in whole or in part, at such time by means of a “cashless exercise” in which
the Holder shall be entitled to receive a number of Warrant Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:
(A)
= as applicable: (i) the VWAP on the Trading Day immediately preceding the date of the applicable Notice of Exercise if such Notice of
Exercise is (1) both executed and delivered pursuant to Section 2(a) hereof on a day that is not a Trading Day or (2) both executed
and delivered pursuant to Section 2(a) hereof on a Trading Day prior to the opening of “regular trading hours” (as
defined in Rule 600(b) of Regulation NMS promulgated under the federal securities laws) on such Trading Day, (ii) the Bid Price of the
Common Stock on the principal Trading Market as reported by Bloomberg L.P. (“Bloomberg”) as of the time of the Holder’s
execution of the applicable Notice of Exercise if such Notice of Exercise is executed during “regular trading hours” on a
Trading Day and is delivered within two (2) hours thereafter (including until two (2) hours after the close of “regular trading
hours” on a Trading Day) pursuant to Section 2(a) hereof or (iii) the VWAP on the date of the applicable Notice of Exercise
if the date of such Notice of Exercise is a Trading Day and such Notice of Exercise is both executed and delivered pursuant to Section
2(a) hereof after the close of “regular trading hours” on such Trading Day;
(B)
= the Exercise Price of this Warrant, as adjusted hereunder; and
(X)
= the number of Warrant Shares that would be issuable upon exercise of this Warrant in accordance with the terms of this Warrant if such
exercise were by means of a cash exercise rather than a cashless exercise.
If
Warrant Shares are issued in such a cashless exercise, the parties acknowledge and agree that in accordance with Section 3(a)(9) of the
Securities Act, the Warrant Shares shall take on the characteristics of the Warrants being exercised, and the holding period of the Warrant
Shares being issued may be tacked on to the holding period of this Warrant. The Company agrees not to take any position contrary to this
Section 2(c).
“Bid
Price” means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock
is then listed or quoted on a Trading Market, the bid price of the Common Stock for the time in question (or the nearest preceding date)
on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg (based on a Trading Day from 9:30 a.m.
(New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading Market, the VWAP of the Common Stock
for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the Common Stock is not then listed or quoted for
trading on OTCQB or OTCQX and if prices for the Common Stock are then reported on The Pink Open Market (or a similar organization or
agency succeeding to its functions of reporting prices), the most recent bid price per share of Common Stock so reported, or (d) in all
other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected in good faith by the
Purchasers of a majority in interest of the Securities then outstanding and reasonably acceptable to the Company, the fees and expenses
of which shall be paid by the Company.
“Trading
Day” means any day on which the Trading Market is open for trading, including any day on which the Trading Market is open for
trading for a period of time less than the customary time.
2
“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then listed
or quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest preceding date)
on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg (based on a Trading Day from 9:30 a.m.
(New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading Market, the volume weighted average price
of the Common Stock for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the Common Stock is not then
listed or quoted for trading on OTCQB or OTCQX and if prices for the Common Stock are then reported on The Pink Open Market (or a similar
organization or agency succeeding to its functions of reporting prices), the most recent bid price per share of Common Stock so reported,
or (d) in all other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected in good
faith by the Purchasers of a majority in interest of the Securities then outstanding and reasonably acceptable to the Company, the fees
and expenses of which shall be paid by the Company.
(d)
Mechanics of Exercise.
i.
Delivery of Warrant Shares Upon Exercise. The Company shall cause the Warrant Shares purchased hereunder to be transmitted to
the Holder by crediting the account of the Holder’s or its designee’s balance account with The Depository Trust Company through
its Deposit or Withdrawal at Custodian system (“DWAC”) if the Company is then a participant in such system and either
(A) there is an effective registration statement permitting the issuance of the Warrant Shares to or resale of the Warrant Shares by
Holder or (B) the Warrant Shares are eligible for resale by the Holder without volume or manner-of-sale limitations pursuant to Rule
144 (assuming cashless exercise of the Warrant), and otherwise by physical delivery of the Warrant Shares, registered in the Company’s
share register in the name of the Holder or its designee, for the number of Warrant Shares set forth in the Notice of Exercise to the
address specified by the Holder in such Notice of Exercise by the date that is the earliest of (i) two (2) Trading Days after the delivery
to the Company of the Notice of Exercise, (ii) one (1) Trading Day after delivery of the aggregate Exercise Price to the Company, and
(iii) the number of Trading Days comprising the Standard Settlement Period after the delivery to the Company of the Notice of Exercise
(such date, the “Warrant Share Delivery Date”). Upon delivery of the Notice of Exercise, the Holder shall be deemed
for all corporate purposes to have become the holder of record of the Warrant Shares with respect to which this Warrant has been exercised,
irrespective of the date of delivery of the Warrant Shares, provided that payment of the aggregate Exercise Price (other
than in the case of a cashless exercise) is received within the earlier of (i) two (2) Trading Days and (ii) the number of Trading Days
comprising the Standard Settlement Period following delivery of the Notice of Exercise. If the Company fails for any reason to deliver
to the Holder the Warrant Shares subject to a Notice of Exercise by the Warrant Share Delivery Date, the Company shall pay to the Holder,
in cash, as liquidated damages and not as a penalty, for each $1,000 of Warrant Shares subject to such exercise (based on the VWAP of
the Common Stock on the date of the applicable Notice of Exercise), $10 per Trading Day (increasing to $20 per Trading Day on the fifth
Trading Day after the Warrant Share Delivery Date) for each Trading Day after such Warrant Share Delivery Date until such Warrant Shares
are delivered or Holder rescinds such exercise. The Company agrees to maintain a transfer agent (the “Transfer Agent”)
that is a participant in the FAST program so long as this Warrant remains outstanding and exercisable. As used herein, “Standard
Settlement Period” means the standard settlement period, expressed in a number of Trading Days, on the Company’s primary
Trading Market with respect to the Common Stock as in effect on the date of delivery of the Notice of Exercise. The Holder and any
assignee, by acceptance of this Warrant, acknowledge and agree that, by reason of the provisions of this paragraph, following the purchase
of a portion of the Warrant Shares hereunder, the number of Warrant Shares available for purchase hereunder at any given time will be
less than the amount stated on the face hereof.
ii.
Delivery of New Warrants Upon Exercise. If this Warrant shall have been exercised in part, the Company shall, at the request of
a Holder and upon surrender of this Warrant certificate, at the time of delivery of the Warrant Shares, deliver to the Holder a new Warrant
evidencing the rights of the Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant shall in
all other respects be identical with this Warrant.
iii.
Rescission Rights. If the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares pursuant to Section
2(d)(i) by the Warrant Share Delivery Date, then the Holder will have the right to rescind such exercise.
3
iv.
Compensation for Buy-In on Failure to Timely Deliver Warrant Shares Upon Exercise. In addition to any other rights available to
the Holder, if the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares in accordance with the provisions
of Section 2(d)(i) above pursuant to an exercise on or before the Warrant Share Delivery Date, and if after such date the Holder
is required by its broker to purchase (in an open market transaction or otherwise) or the Holder’s brokerage firm otherwise purchases,
shares of Common Stock to deliver in satisfaction of a sale by the Holder of the Warrant Shares which the Holder anticipated receiving
upon such exercise (a “Buy-In”), then the Company shall (A) pay in cash to the Holder the amount, if any, by which
(x) the Holder’s total purchase price (including brokerage commissions, if any) for the Warrant Shares so purchased exceeds (y)
the amount obtained by multiplying (1) the number of Warrant Shares that the Company was required to deliver to the Holder in connection
with the exercise at issue times (2) the price at which the sell order giving rise to such purchase obligation was executed, and (B)
at the option of the Holder, either reinstate the portion of the Warrant and equivalent number of Warrant Shares for which such exercise
was not honored (in which case such exercise shall be deemed rescinded) or deliver to the Holder the number of shares of Common Stock
that would have been issued had the Company timely complied with its exercise and delivery obligations hereunder. For example, if the
Holder purchases shares of Common Stock having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted exercise
of Warrants with an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (A) of the immediately preceding
sentence the Company shall be required to pay the Holder $1,000. The Holder shall provide the Company written notice indicating the amounts
payable to the Holder in respect of the Buy-In and, upon request of the Company, evidence satisfactory to the Company with respect to
the amount of such loss. Nothing herein shall limit a Holder’s right to pursue any other remedies available to it hereunder, at
law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s
failure to timely deliver Warrant Shares upon exercise of the Warrant as required pursuant to the terms hereof.
v.
No Fractional Shares or Scrip. No fractional Warrant Shares or scrip representing fractional Warrant Shares shall be issued upon
the exercise of this Warrant. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such exercise,
the Company shall, at its election and in lieu of the issuance of such fractional Warrant Share, either (i) pay cash in an amount equal
to such fraction multiplied by the Exercise Price or (ii) round up to the next whole Warrant Share.
vi.
Charges, Taxes and Expenses. The issuance and delivery of Warrant Shares shall be made without charge to the Holder for any issue
or transfer tax or other incidental expense in respect of the issuance of such Warrant Shares, all of which taxes and expenses shall
be paid by the Company, and such Warrant Shares shall be issued in the name of the Holder or in such name or names as may be directed
by the Holder; provided, however, that, in the event that Warrant Shares are to be issued in a name other
than the name of the Holder, the Notice of Exercise shall be accompanied by the Assignment Form, attached hereto as Exhibit B,
duly executed by the Holder and the Company may require, as a condition thereto, the payment of a sum sufficient to reimburse it for
any transfer tax incidental thereto and this Warrant shall be surrendered to the Company and, if any portion of this Warrant remains
unexercised, a new Warrant in the form hereof shall be delivered to the assignee. The Company shall pay all Transfer Agent fees required
for same-day processing of any Notice of Exercise and all fees to the Depository Trust Company (or another established clearing corporation
performing similar functions) required for same-day electronic delivery of the Warrant Shares.
vii.
Closing of Books. The Company will not close its stockholder books or records in any manner which prevents the timely exercise
of this Warrant, pursuant to the terms hereof.
4
(e)
Holder’s Exercise Limitations. The Company shall not effect any exercise of this Warrant, and a Holder shall not have the
right to exercise all or any portion of this Warrant, pursuant to Section 2 or otherwise, to the extent that after giving effect
to such issuance upon exercise as set forth on the applicable Notice of Exercise, the Holder (together with (i) the Holder’s Affiliates,
(ii) any other Persons acting as a group together with the Holder or any of the Holder’s Affiliates, and (iii) any other Persons
whose beneficial ownership of the shares of Common Stock would or could be aggregated with the Holder’s for the purposes of Section
13(d) (such Persons, “Attribution Parties”)), would beneficially own in excess of the Beneficial Ownership Limitation
(as defined below). For purposes of the foregoing sentence, the number of shares of Common Stock beneficially owned by the Holder and
its Affiliates and Attribution Parties shall include the number of shares of Common Stock issuable upon exercise of this Warrant with
respect to which such determination is being made, but shall exclude the number of the Warrant Shares which would be issuable upon (i)
exercise of the remaining, nonexercised portion of this Warrant beneficially owned by the Holder or any of its Affiliates or Attribution
Parties and (ii) exercise or conversion of the unexercised or nonconverted portion of any other securities of the Company (including,
without limitation, any other Common Stock Equivalents) subject to a limitation on conversion or exercise analogous to the limitation
contained herein beneficially owned by the Holder or any of its Affiliates or Attribution Parties. Except as set forth in the preceding
sentence, for purposes of this Section 2(e), beneficial ownership shall be calculated in accordance with Section 13(d) of the
Exchange Act and the rules and regulations promulgated thereunder, it being acknowledged by the Holder that the Company is not representing
to the Holder that such calculation is in compliance with Section 13(d) of the Exchange Act and the Holder is solely responsible for
any schedules required to be filed in accordance therewith. To the extent that the limitation contained in this Section 2(e) applies,
the determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates
and Attribution Parties) and of which portion of this Warrant is exercisable shall be in the sole discretion of the Holder, and the submission
of a Notice of Exercise shall be deemed to be the Holder’s determination of whether this Warrant is exercisable (in relation to
other securities owned by the Holder together with any Affiliates and Attribution Parties) and of which portion of this Warrant is exercisable,
in each case subject to the Beneficial Ownership Limitation, and the Company shall have no obligation to verify or confirm the accuracy
of such determination. In addition, a determination as to any group status as contemplated above shall be determined in accordance with
Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. For purposes of this Section 2(e), in
determining the number of outstanding shares of Common Stock, a Holder may rely on the number of outstanding shares of Common Stock as
reflected in (A) the Company’s most recent periodic or annual report filed with the Commission, as the case may be, (B) a more
recent public announcement by the Company or (C) a more recent written notice by the Company or the Transfer Agent setting forth the
number of shares of Common Stock outstanding. Upon the written or oral request of a Holder, the Company shall within one Trading Day
confirm orally and in writing to the Holder the number of shares of Common Stock then outstanding. In any case, the number of outstanding
shares of Common Stock shall be determined after giving effect to the conversion or exercise of securities of the Company, including
this Warrant, by the Holder or its Affiliates or Attribution Parties since the date as of which such number of outstanding shares of
Common Stock was reported. The “Beneficial Ownership Limitation” shall be 4.99% of the number of shares of Common Stock outstanding
immediately after giving effect to the issuance of Warrant Shares issuable upon exercise of this Warrant. The Holder, upon notice to
the Company, may increase or decrease the Beneficial Ownership Limitation provisions of this Section 2(e), provided that
the Beneficial Ownership Limitation in no event exceeds 9.99% of the number of shares of Common Stock outstanding immediately after giving
effect to the issuance of Warrant Shares upon exercise of this Warrant held by the Holder and the provisions of this Section 2(e)
shall continue to apply. Any increase in the Beneficial Ownership Limitation will not be effective until the sixty-first (61st)
day after such notice is delivered to the Company. The provisions of this paragraph shall be construed and implemented in a manner otherwise
than in strict conformity with the terms of this Section 2(e) to correct this paragraph (or any portion hereof) which may be defective
or inconsistent with the intended Beneficial Ownership Limitation herein contained or to make changes or supplements necessary or desirable
to properly give effect to such limitation. The limitations contained in this paragraph shall apply to a successor holder of this Warrant.
Section
3. Certain Adjustments.
(a)
Stock Dividends and Splits. If the Company, at any time while this Warrant is outstanding: (i) pays a stock dividend or otherwise
makes a distribution or distributions on shares of Common Stock or any other equity or equity equivalent securities payable in shares
of Common Stock (which, for avoidance of doubt, shall not include any Warrant Shares issued by the Company upon exercise of this Warrant),
(ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines (including by way of reverse stock
split) outstanding shares of Common Stock into a smaller number of shares, or (iv) issues by reclassification of shares of Common Stock
any shares of capital stock of the Company, then in each case the Exercise Price shall be multiplied by a fraction of which the numerator
shall be the number of shares of Common Stock (excluding treasury shares, if any) outstanding immediately before such event and of which
the denominator shall be the number of shares of Common Stock outstanding immediately after such event, and the number of shares issuable
upon exercise of this Warrant shall be proportionately adjusted such that the aggregate Exercise Price of this Warrant remains unchanged.
Any adjustment made pursuant to this Section 3(a) shall become effective immediately after the record date for the determination
of stockholders entitled to receive such dividend or distribution and shall become effective immediately after the effective date in
the case of a subdivision, combination or reclassification.
5
(b)
RESERVED.
(c)
Subsequent Rights Offerings. In addition to any adjustments pursuant to Section 3(a) above, if at any time the Company
grants, issues or sells any Common Stock Equivalents or rights to purchase stock, warrants, securities or other property pro rata to
the record holders of any class of Common Stock (the “Purchase Rights”), then the Holder will be entitled to acquire,
upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired if the Holder had
held the number of shares of Common Stock acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise
hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the date on which a record is taken for
the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of shares
of Common Stock are to be determined for the grant, issue or sale of such Purchase Rights (provided, however,
that, to the extent that the Holder’s right to participate in any such Purchase Right would result in the Holder exceeding the
Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Purchase Right to such extent (or beneficial
ownership of such shares of Common Stock as a result of such Purchase Right to such extent) and such Purchase Right to such extent shall
be held in abeyance for the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial
Ownership Limitation).
(d)
Pro Rata Distributions. During such time as this Warrant is outstanding, if the Company shall declare or make any dividend or
other distribution of its assets (or rights to acquire its assets) to holders of shares of Common Stock, by way of return of capital
or otherwise (including, without limitation, any distribution of cash, stock or other securities, property or options by way of a dividend,
spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a “Distribution”),
at any time after the issuance of this Warrant, then, in each such case, the Holder shall be entitled to participate in such Distribution
to the same extent that the Holder would have participated therein if the Holder had held the number of shares of Common Stock acquirable
upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including without limitation, the Beneficial
Ownership Limitation) immediately before the date of which a record is taken for such Distribution, or, if no such record is taken, the
date as of which the record holders of shares of Common Stock are to be determined for the participation in such Distribution (provided,
however, that, to the extent that the Holder’s right to participate in any such Distribution would result in the
Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Distribution to such
extent (or in the beneficial ownership of any shares of Common Stock as a result of such Distribution to such extent) and the portion
of such Distribution shall be held in abeyance for the benefit of the Holder until such time, if ever, as its right thereto would not
result in the Holder exceeding the Beneficial Ownership Limitation).
6
(e)
Fundamental Transaction. If, at any time while this Warrant is outstanding, (i) the Company, directly or indirectly, in one or
more related transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company (or any Subsidiary),
directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially
all of the Company’s assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer
or exchange offer (whether by the Company or another Person) is completed pursuant to which holders of Common Stock are permitted to
sell, tender or exchange their shares for other securities, cash or property and has been accepted by the holders of more than 50% of
the voting power of the common equity of the Company, (iv) the Company, directly or indirectly, in one or more related transactions effects
any reclassification, reorganization or recapitalization of shares of Common Stock or any compulsory share exchange pursuant to which
the shares of Common Stock are effectively converted into or exchanged for other securities, cash or property, or (v) the Company, directly
or indirectly, in one or more related transactions consummates a stock or share purchase agreement or other business combination (including,
without limitation, a reorganization, recapitalization, spin-off, merger or scheme of arrangement) with another Person or group of Persons
whereby such other Person or group acquires more than 50% of the voting power of the common equity of the Company (each a “Fundamental
Transaction”), then, upon any subsequent exercise of this Warrant, the Holder shall have the right to receive, for each Warrant
Share that would have been issuable upon such exercise immediately prior to the occurrence of such Fundamental Transaction, at the option
of the Holder (without regard to any limitation in Section 2(e) on the exercise of this Warrant), the number of shares of Common
Stock of the successor or acquiring corporation or of the Company, if it is the surviving corporation, and any additional consideration
(the “Alternate Consideration”) receivable as a result of such Fundamental Transaction by a holder of the number of
shares of Common Stock for which this Warrant is exercisable immediately prior to such Fundamental Transaction (without regard to any
limitation in Section 2(e) on the exercise of this Warrant). For purposes of any such exercise, the determination of the Exercise
Price shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration issuable
in respect of one share of Common Stock in such Fundamental Transaction, and the Company shall apportion the Exercise Price among the
Alternate Consideration in a reasonable manner reflecting the relative value of any different components of the Alternate Consideration.
If holders of Common Stock are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then
the Holder shall be given the same choice as to the Alternate Consideration it receives upon any exercise of this Warrant following such
Fundamental Transaction. Notwithstanding anything to the contrary, in the event of a Fundamental Transaction, the Company or any Successor
Entity (as defined below) shall, at the Holder’s option, exercisable at any time concurrently with, or within thirty (30) days
after, the consummation of the Fundamental Transaction (or, if later, the date of the public announcement of the applicable Fundamental
Transaction), purchase this Warrant from the Holder by paying to the Holder, as described below, an amount of consideration equal to
the Black Scholes Value (as defined below) of the remaining unexercised portion of this Warrant on the date of the consummation of such
Fundamental Transaction, provided, however, that, if the Fundamental Transaction is not within the Company’s
control, including not approved by the Company’s Board of Directors, Holder shall only be entitled to receive from the Company
or any Successor Entity, as of the date of the consummation of such Fundamental Transaction the same type or form of consideration (and
in the same proportion), valued at the Black Scholes Value of the unexercised portion of this Warrant, that is being offered and paid
to the holders of Common Stock of the Company in connection with the Fundamental Transaction, whether that consideration be in the form
of cash, stock or any combination thereof, or whether the holders of Common Stock are given the choice to receive from among alternative
forms of consideration in connection with the Fundamental Transaction; provided further, that if holders of Common Stock
of the Company are not offered or paid any consideration in such Fundamental Transaction, such holders of Common Stock will be deemed
to have received shares of the Successor Entity (which Successor Entity may be the Company following such Fundamental Transaction) in
such Fundamental Transaction. “Black Scholes Value” means the value of this Warrant based on the Black-Scholes Option Pricing
Model obtained from the “OV” function on Bloomberg, L.P. (“Bloomberg”) determined as of the day of consummation
of the applicable Fundamental Transaction for pricing purposes and reflecting (A) a risk-free interest rate corresponding to the U.S.
Treasury rate for a period equal to the time between the date of the public announcement of the applicable contemplated Fundamental Transaction
and the Termination Date, (B) an expected volatility equal to the 100 day volatility obtained from the HVT function on Bloomberg (determined
utilizing a 365-day annualization factor) as of the Trading Day immediately following the public announcement of the applicable Fundamental
Transaction, (C) the underlying price per share used in such calculation shall be the sum of the price per share being offered in cash,
if any, plus the value of any non-cash consideration, if any, being offered in such Fundamental Transaction and (D) a remaining option
time equal to the time between the date of the public announcement of the applicable Fundamental Transaction and the Termination Date
and (E) a zero cost of borrow. The payment of the Black Scholes Value will be made by wire transfer of immediately available funds within
five Business Days of the Holder’s election (or, if later, on the effective date of the Fundamental Transaction). The Company shall
cause any successor entity in a Fundamental Transaction in which the Company is not the survivor (the “Successor Entity”)
to assume in writing all of the obligations of the Company under this Warrant and the other Transaction Documents in accordance with
the provisions of this Section 3(e) pursuant to written agreements in form and substance reasonably satisfactory to the Holder
prior to such Fundamental Transaction and shall, at the option of the Holder, deliver to the Holder in exchange for this Warrant a security
of the Successor Entity evidenced by a written instrument substantially similar in form and substance to this Warrant which is exercisable
for a corresponding number of shares of capital stock of such Successor Entity (or its parent entity) equivalent to the shares of Common
Stock acquirable and receivable upon exercise of this Warrant (without regard to any limitations on the exercise of this Warrant) prior
to such Fundamental Transaction, and with an exercise price which applies the exercise price hereunder to such shares of capital stock
(but taking into account the relative value of the shares of Common Stock pursuant to such Fundamental Transaction and the value of such
shares of capital stock, such number of shares of capital stock and such exercise price being for the purpose of protecting the economic
value of this Warrant immediately prior to the consummation of such Fundamental Transaction), and which is reasonably satisfactory in
form and substance to the Holder. Upon the occurrence of any such Fundamental Transaction, the Successor Entity shall succeed to, and
be substituted for (so that from and after the date of such Fundamental Transaction, the provisions of this Warrant and the other Transaction
Documents referring to the “Company” shall refer instead to the Successor Entity), and may exercise every right and power
of the Company and shall assume all of the obligations of the Company under this Warrant and the other Transaction Documents with the
same effect as if such Successor Entity had been named as the Company herein.
(f)
Calculations. All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share
of Common Stock, as the case may be. For purposes of this Section 3, the number of shares of Common Stock deemed to be issued
and outstanding as of a given date shall be the sum of the number of shares of Common Stock (excluding treasury shares, if any) issued
and outstanding.
7
(g)
Notice to Holder.
i.
Adjustment to Exercise Price. Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the
Company shall promptly deliver to the Holder by facsimile or email a notice setting forth the Exercise Price after such adjustment and
any resulting adjustment to the number of Warrant Shares and setting forth a brief statement of the facts requiring such adjustment.
ii.
Notice to Allow Exercise by Holder. If (A) the Company declares a dividend (or any other distribution in whatever form) on the
shares of Common Stock, (B) the Company declares a special nonrecurring cash dividend on or a redemption of the shares of Common Stock,
(C) the Company authorizes the granting to all holders of the shares of Common Stock rights or warrants to subscribe for or purchase
any shares of capital stock of any class or of any rights, (D) the approval of any shareholders of the Company is required in connection
with a Fundamental Transaction, or (E) the Company authorizes the voluntary or involuntary dissolution, liquidation or winding up of
the affairs of the Company, then, in each case, the Company shall cause to be delivered by facsimile or email to the Holder at its last
facsimile number or email address as it shall appear upon the Warrant Register of the Company, at least 20 calendar days prior to the
applicable record or effective date hereinafter specified, a notice stating (x) the date on which a record is to be taken for the purpose
of such dividend, distribution, redemption, rights or warrants, or if a record is not to be taken, the date as of which the holders of
the Common Stock of record to be entitled to such dividend, distributions, redemption, rights or warrants are to be determined or (y)
the date on which such reclassification, consolidation, merger, sale, transfer or share exchange is expected to become effective or close,
and the date as of which it is expected that holders of the Common Stock of record shall be entitled to exchange their shares of Common
Stock for securities, cash or other property deliverable upon such reclassification, consolidation, merger, sale, transfer or share exchange;
provided that the failure to deliver such notice or any defect therein or in the delivery thereof shall not affect the
validity of the corporate action required to be specified in such notice and provided, further that no notice shall be
required if the information is disseminated in a press release or document filed with the Commission. To the extent that any notice provided
in this Warrant constitutes, or contains, material, non-public information regarding the Company or any of the Subsidiaries, the Company
shall simultaneously file such notice with the Commission pursuant to a Current Report on Form 8-K. The Holder shall remain entitled
to exercise this Warrant during the period commencing on the date of such notice to the effective date of the event triggering such notice
except as may otherwise be expressly set forth herein.
(h)
Voluntary Adjustment By Company. Subject to the rules and regulations of the Trading Market, the Company may at any time while
this Warrant is outstanding, reduce the then-current Exercise Price to any amount and for any period of time deemed appropriate by the
board of directors of the Company in its sole discretion.
Section
4. Transfer of Warrant.
(a)
Transferability. Subject to compliance with any applicable securities laws and the conditions set forth herein, this Warrant and
all rights hereunder (including, without limitation, any registration rights) are transferable, in whole or in part, upon surrender of
this Warrant at the principal office of the Company or its designated agent, together with a written assignment of this Warrant substantially
in the form attached hereto as Exhibit B duly executed by the Holder or its agent or attorney and funds sufficient to pay
any transfer taxes payable upon the making of such transfer. Upon such surrender and, if required, such payment, the Company shall execute
and deliver a new Warrant or Warrants in the name of the assignee or assignees, as applicable, and in the denomination or denominations
specified in such instrument of assignment, and shall issue to the assignor a new Warrant evidencing the portion of this Warrant not
so assigned, and this Warrant shall promptly be cancelled. Notwithstanding anything herein to the contrary, the Holder shall not be required
to physically surrender this Warrant to the Company unless the Holder has assigned this Warrant in full, in which case, the Holder shall
surrender this Warrant to the Company within three (3) Trading Days of the date on which the Holder delivers an assignment form to the
Company assigning this Warrant in full. The Warrant, if properly assigned in accordance herewith, may be exercised by a new holder for
the purchase of Warrant Shares without having a new Warrant issued.
8
(b)
New Warrants. This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of
the Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by
the Holder or its agent or attorney. Subject to compliance with Section 4(a), as to any transfer which may be involved in such
division or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be
divided or combined in accordance with such notice. All Warrants issued on transfers or exchanges shall be dated the initial issuance
date of this Warrant and shall be identical with this Warrant except as to the number of Warrant Shares issuable pursuant thereto.
(c)
Warrant Register. The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the
“Warrant Register”), in the name of the record Holder hereof from time to time. The Company may deem and treat the
registered Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder,
and for all other purposes, absent actual notice to the contrary.
(d)
Transfer Restrictions. If, at the time of the surrender of this Warrant in connection with any transfer of this Warrant, the transfer
of this Warrant shall not be either (i) registered pursuant to an effective registration statement under the Securities Act and under
applicable state securities or blue sky laws or (ii) eligible for resale without volume or manner-of-sale restrictions or current public
information requirements pursuant to Rule 144, the Company may require, as a condition of allowing such transfer, that the Holder or
transferee of this Warrant, as the case may be, comply with the provisions of Section 5(f) of this Warrant.
(e)
Representation by the Holder. The Holder, by the acceptance hereof, represents and warrants that it is acquiring this Warrant
and, upon any exercise hereof, will acquire the Warrant Shares issuable upon such exercise, for its own account and not with a view to
or for distributing or reselling such Warrant Shares or any part thereof in violation of the Securities Act or any applicable state securities
law, except pursuant to sales registered or exempted under the Securities Act.
Section
5. Miscellaneous.
(a)
No Rights as Stockholder Until Exercise; No Settlement in Cash. This Warrant does not entitle the Holder to any voting rights,
dividends or other rights as a stockholder of the Company prior to the exercise hereof as set forth in Section 2(d)(i), except
as expressly set forth in Section 3. Without limiting any rights of a Holder to receive Warrant Shares on a “cashless exercise”
pursuant to Section 2(c) or to receive cash payments pursuant to Section 2(d)(i) and Section 2(d)(iv) herein, in
no event shall the Company be required to net cash settle an exercise of this Warrant.
(b)
Loss, Theft, Destruction or Mutilation of Warrant. The Company covenants that upon receipt by the Company of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any stock certificate relating to the Warrant Shares,
and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of the Warrant,
shall not include the posting of any bond), and upon surrender and cancellation of such Warrant or stock certificate, if mutilated, the
Company will make and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation, in lieu of such Warrant
or stock certificate.
(c)
Saturdays, Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required
or granted herein shall not be a Trading Day, then such action may be taken or such right may be exercised on the next succeeding Trading
Day.
(d)
Authorized Shares. The Company covenants that, during the period the Warrant is outstanding, it will reserve from its authorized
and unissued shares of Common Stock a sufficient number of shares to provide for the issuance of the Warrant Shares underlying this Warrant.
The Company further covenants that its issuance of this Warrant shall constitute full authority to its officers who are charged with
the duty of issuing the necessary Warrant Shares upon the exercise of the purchase rights under this Warrant. The Company will take all
such reasonable action as may be necessary to assure that such Warrant Shares may be issued, and the Warrant Shares, delivered, as provided
herein without violation of any applicable law or regulation, or of any requirements of the Trading Market upon which the Common Stock
may be listed. The Company covenants that all Warrant Shares underlying this Warrant, which may be issued upon the exercise of the purchase
rights represented by this Warrant will, upon exercise of the purchase rights represented by this Warrant and payment for such Warrant
Shares in accordance herewith, be duly authorized, validly issued, fully paid and nonassessable and free from all taxes, liens and charges
created by the Company in respect of the issue thereof (other than taxes in respect of any transfer occurring contemporaneously with
such issue).
9
Except
and to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending
its certificate of incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale
of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant,
but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary
or appropriate to protect the rights of Holder as set forth in this Warrant against impairment. Without limiting the generality of the
foregoing, the Company will (i) not increase the par value of any shares of Common Stock above the amount payable therefor upon such
exercise immediately prior to such increase in par value, (ii) take all such action as may be necessary or appropriate in order that
the Company may validly and legally issue fully paid and nonassessable shares of Common Stock upon the exercise of this Warrant and (iii)
use commercially reasonable efforts to obtain all such authorizations, exemptions or consents from any public regulatory body having
jurisdiction thereof, as may be, necessary to enable the Company to perform its obligations under this Warrant.
Before
taking any action which would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the
Exercise Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from
any public regulatory body or bodies having jurisdiction thereof.
Nothing
contained herein shall prohibit the Company from consummating any acquisition, merger, asset purchase, joint venture, strategic alliance,
licensing transaction or other strategic transaction approved by its Board of Directors.
(e)
Jurisdiction. All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be determined
in accordance with the provisions of the Inducement Agreement.
(f)
Restrictions. The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered, and
if the Holder does not utilize cashless exercise, will have restrictions upon resale imposed by state and federal securities laws.
(g)
Nonwaiver and Expenses. No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall
operate as a waiver of such right or otherwise prejudice the Holder’s rights, powers or remedies. Without limiting any other provision
of this Warrant or the Inducement Agreement, if the Company willfully and knowingly fails to comply with any provision of this Warrant,
which results in any material damages to the Holder, the Company shall pay to the Holder such amounts as shall be sufficient to cover
any costs and expenses including, but not limited to, reasonable attorneys’ fees, including those of appellate proceedings, incurred
by the Holder in collecting any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies hereunder.
(h)
Notices. Any notice, request or other document required or permitted to be given or delivered to the Holder by the Company shall
be delivered in accordance with the notice provisions of the Inducement Agreement.
(i)
Limitation of Liability. No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant
to purchase Warrant Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of
the Holder for the purchase price of any share of Common Stock or as a stockholder of the Company, whether such liability is asserted
by the Company or by creditors of the Company.
(j)
Remedies. The Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will
be entitled to specific performance of its rights under this Warrant. The Company agrees that monetary damages would not be adequate
compensation for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive and not to
assert the defense in any action for specific performance that a remedy at law would be adequate.
(k)
Successors and Assigns. Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall
inure to the benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted assigns
of Holder. The provisions of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant and shall
be enforceable by the Holder or holder of Warrant Shares.
(l)
Amendment. This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company and
the Holder.
(m)
Severability. Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall
be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining
provisions of this Warrant.
(n)
Headings. The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed
a part of this Warrant.
********************
[Signature
Page Follows]
10
IN
WITNESS WHEREOF, the Company has caused this Warrant to be executed by its officer thereunto duly authorized as of the date first above
indicated.
CYCURION,
INC.
By:
/s/
L. Kevin Kelly
Name:
L.
Kevin Kelly
Title:
Chief
Executive Officer
11
EXHIBIT
A
NOTICE
OF EXERCISE
TO:
CYCURION, INC.
(1)
The undersigned hereby elects to purchase ________ Warrant Shares of the Company pursuant to the terms of the attached Warrant (only
if exercised in full), and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes, if any.
(2)
Payment shall take the form of (check applicable box):
[ ]
in
lawful money of the United States; or
[ ]
if
permitted the cancellation of such number of Warrant Shares as is necessary, in accordance with the formula set forth in subsection
2(c), to exercise this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise
procedure set forth in subsection 2(c).
(3)
Please issue said Warrant Shares in the name of the undersigned or in such other name as is specified below:
The
Warrant Shares shall be delivered to the following DWAC Account Number:
[SIGNATURE
OF HOLDER]
Name
of Investing Entity:
Signature
of Authorized Signatory of Investing Entity:
Name
of Authorized Signatory
Title
of Authorized Signature:
Date
12
EXHIBIT
B
ASSIGNMENT
FORM
(To
assign the foregoing Warrant, execute this form and supply required information. Do not use this form to purchase shares.)
FOR
VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby are hereby assigned to
Name:
(Please
Print)
Address:
(Please
Print)
Phone
Number
Address:
Dated:
_______________ ____, _______
Holder’s
Signature
Holder’s
Address
13
EX-10.1
EX-10.1
Filename: ex10-1.htm · Sequence: 3
Exhibit
10.1
Cycurion,
Inc.
1640
Boro Place, Suite 420C
McLean,
Virginia
July
30, 2026
To
the Holder of Common Stock Purchase Warrants Issued in December 2025
Re:
Inducement Offer to Exercise Existing Shares of Common Stock Purchase Warrants
Dear
Holder:
Cycurion,
Inc. (the “Company”) is pleased to offer (this “Inducement Offer”) to you (“Holder”,
“you” or similar terminology) the opportunity to receive new common stock purchase warrants (the “New Warrants”)
to purchase up to 5,012,159 shares of the Company’s common stock, par value $0.0001 per share (the “Common Stock”),
which is equal to 150% of the number of shares of Common Stock issuable upon exercise of a common stock purchase warrant to purchase
up to 3,341,439 shares of Common Stock at an exercise price of $3.62 per share issued to you on December 5, 2025 (the “Existing
Warrants”), as more particularly set forth on the signature page hereto, in consideration for exercising for cash all such
Existing Warrants. The issuance of the shares of Common Stock underlying the Existing Warrants have been registered pursuant to the Company’s
effective registration statement on Form S-1 (File No. 333-292371). The shares of Common Stock underlying the Existing Warrants are referred
to herein as the “Warrant Shares”. Capitalized terms not otherwise defined herein shall have the meanings set forth
in the New Warrants.
The
Company is making you this offer during the period from the date of this Inducement Offer set forth above and until 10:00 p.m. Eastern
Time, on July 31, 2026 (the “Exercise Period”). Exercise of the Existing Warrants may be made, in whole or in part,
at any time or times during the Exercise Period by delivery to the Company of a duly executed facsimile copy or PDF copy submitted by
e-mail (or e-mail attachment) of the Notice of Exercise attached to the Existing Warrants, as applicable; provided, that
the exercise of Existing Warrants will be accompanied by payment in full of the Exercise Price (as defined below) to the Company.
The
Company desires to reduce the Exercise Price of the Existing Warrants to $1.35 per share (the “Exercise Price”). In
consideration for exercising the Existing Warrants held by the Holder, and each time that the Holder exercises Existing Warrants pursuant
to the terms of this Offer (the “Warrant Exercise”) during the Exercise Period, the Company hereby offers to issue
you or your designees on a proportional basis unregistered New Warrants to purchase up to 5,012,159 shares of Common Stock (the “New
Warrant Shares”), which equals 150% of the number of Warrant Shares issued pursuant to the exercise of the Existing Warrants,
which New Warrants shall be issued pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended (“Securities Act”),
and which New Warrants shall be substantially in the form as set forth in Exhibit A hereto. The New Warrants will be exercisable
on or after the date on which approval as may be required by the applicable rules and regulations of the Nasdaq Stock Market from the
stockholders of the Company with respect to the exercise of the New Warrants and the issuance of all of the Warrant Shares upon exercise
thereof is obtained (the “Stockholder Approval Date”), have an exercise price of $1.65 per share and have a term of
exercise of five (5) years from the Stockholder Approval Date. The New Warrants will be delivered within one (1) Trading Day following
the Warrant Exercise, and such New Warrants, together with any Warrant Shares, shall, unless and until registered, contain customary
restrictive legends and other language typical for an unregistered warrant and unregistered shares. Notwithstanding anything herein to
the contrary, in the event that any Warrant Exercise would otherwise cause the Holder to exceed the beneficial ownership limitations
(“Beneficial Ownership Limitation”) set forth in Section 2(e) of the Existing Warrants (or, if applicable and at the
Holder’s election, 9.99%), the Company shall only issue such number of Warrant Shares to the Holder that would not cause the Holder
to exceed the maximum number of Warrant Shares permitted thereunder, as directed by the Holder, with the balance to be held in abeyance
until notice from the Holder that the balance (or portion thereof) may be issued in compliance with such limitations, which abeyance
shall be evidenced through the Existing Warrants which shall be deemed prepaid thereafter (including the payment in full of the exercise
price), and exercised pursuant to a Notice of Exercise in the Existing Warrants (provided no additional exercise price shall be due and
payable). The parties hereby agree that the Beneficial Ownership Limitation for purposes of the Existing Warrants is as set forth on
the Holder’s signature page hereto.
Expressly
subject to the paragraph immediately following this paragraph below, the Holder may accept this offer by signing this letter below, which
constitutes the Holder’s acceptance to exercise Existing Warrants in full for an aggregate price of $4,510,942.65, subject to the
Beneficial Ownership Limitation set forth in Section 2(e) of the Existing Warrants.
In
addition, the Company agrees to the representations, warranties and covenants set forth on Annex A attached hereto.
The
Holder represents and warrants that, as of the date hereof, the Holder is fully aware of, and has reviewed all of the Company’s
public filings.
Holder
represents and warrants that, as of the date hereof it is, and on each date on which it exercises any New Warrants it will be, an “accredited
investor” as defined in Rule 501 of Regulation D promulgated under the Securities Act, and agrees that the New Warrants will contain
restrictive legends when issued, and neither the New Warrants nor the New Warrant Shares will be registered under the Securities Act,
except as provided in Annex A attached hereto. Also, the Holder represents and warrants that it is acquiring the New Warrants
as principal for its own account and has no direct or indirect arrangement or understandings with any other persons to distribute or
regarding the distribution of the New Warrants or the New Warrant Shares (this representation is not limiting Holder’s right to
sell the New Warrant Shares pursuant to an effective registration statement under the Securities Act or otherwise in compliance with
applicable federal and state securities laws).
2
The
Holder understands that the issuance of the New Warrants and the New Warrant Shares are not, and may never be, registered under the Securities
Act, or the securities laws of any state and, accordingly, each certificate, if any, representing such securities shall bear a legend
substantially similar to the following:
“NEITHER
THIS SECURITY NOR THE SECURITIES FOR WHICH THIS SECURITY IS EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION
OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. THIS SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE
OF THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT WITH A REGISTERED BROKER-DEALER OR OTHER LOAN WITH A FINANCIAL
INSTITUTION THAT IS AN “ACCREDITED INVESTOR” AS DEFINED IN RULE 501(A) UNDER THE SECURITIES ACT OR OTHER LOAN SECURED BY
SUCH SECURITIES.”
Upon
the Holder’s exercise of the New Warrants, certificates evidencing the New Warrant Shares shall not contain any legend (including
the legend set forth above), (i) while a registration statement covering the resale of such New Warrant Shares is effective under the
Securities Act, (ii) following any sale of such New Warrant Shares pursuant to Rule 144 under the Securities Act, (iii) if such New Warrant
Shares are eligible for sale under Rule 144 (assuming cashless exercise of the New Warrants), without the requirement for the Company
to be in compliance with the current public information requirement under Rule 144 as to such New Warrant Shares and without volume or
manner-of-sale restrictions, (iv) if such New Warrant Shares may be sold under Rule 144 (assuming cashless exercise of the New Warrants)
and the Company is then in compliance with the current public information requirement under Rule 144 as to such New Warrant Shares, or
(v) if such legend is not required under applicable requirements of the Securities Act (including judicial interpretations and pronouncements
issued by the staff of the Securities and Exchange Commission (the “Commission”) and the earliest of clauses (i) through
(v), the “Delegend Date”)). The Company shall cause its counsel to issue a legal opinion to the Transfer Agent promptly
after the Delegend Date if required by the Company and/or the Transfer Agent to effect the removal of the legend hereunder, or at the
request of the Holder, which opinion shall be in form and substance reasonably acceptable to the Holder. From and after the Delegend
Date, such New Warrant Shares shall be issued free of all legends, provided that, upon request of the Company (which request shall also
include a form of customary representation letter), the Holder has delivered in advance to the Company a customary representation letter
and such other documentation required by the Transfer Agent that is reasonably satisfactory to the Company and its counsel. The Company
agrees that following the Delegend Date or at such time as such legend is no longer required under this Section, it will, no later than
one (1) Trading Day following the delivery by the Holder to the Company or the Transfer Agent of a certificate representing the New Warrant
Shares issued with a restrictive legend, along with such certificate(s) or other documentation reasonably requested by the Company’s
counsel and/or the Company’s transfer agent (the “Transfer Agent”), including a customary representation letter,
in form and substance reasonably acceptable to the Company’s counsel and/or the Transfer Agent (such first (1st) Trading
Day, the “Legend Removal Date”), deliver or cause to be delivered to the Holder a certificate representing such shares
that is free from all restrictive and other legends or, at the request of the Holder, shall credit the account of the Holder’s
prime broker with the Depository Trust Company System as directed by the Holder.
3
In
addition to the Holder’s other available remedies, the Company shall pay to a Holder, in cash, (i) as partial liquidated damages
and not as a penalty, for each $1,000 of New Warrant Shares (based on the VWAP of the Shares of Common Stock on the date such New Warrant
Shares are submitted to the Transfer Agent) delivered for removal of the restrictive legend, $10 per Trading Day (increasing to $20 per
Trading Day five (5) Trading Days after such damages have begun to accrue) for each Trading Day after the Legend Removal Date until such
certificate is delivered without a legend and (ii) if the Company fails to (a) issue and deliver (or cause to be delivered) to the Holder
by the Legend Removal Date a certificate representing the New Warrant Shares free from all restrictive and other legends and (b) if after
the Legend Removal Date the Holder purchases (in an open market transaction or otherwise) Shares of Common Stock to deliver in satisfaction
of a sale by the Holder of all or any portion of the number of Shares of Common Stock, or a sale of a number of Shares of Common Stock
equal to all or any portion of the number of Shares of Common Stock that the Holder anticipated receiving from the Company without any
restrictive legend, then, an amount equal to the excess of the Holder’s total purchase price (including brokerage commissions and
other out-of-pocket expenses, if any) for the Shares of Common Stock so purchased (including brokerage commissions and other out-of-pocket
expenses, if any) over the product of (A) such number of New Warrant Shares that the Company was required to deliver to the Holder by
the Legend Removal Date and for which the Holder was required to purchase shares to timely satisfy delivery requirements, multiplied
by (B) the weighted average price at which the Holder sold that number of Shares of Common Stock.
If
this offer is accepted and this offer letter is executed, then on or before 8:00 a.m., Eastern Time, on the date following the date hereof,
the Company shall issue a press release and/or file a Current Report on Form 8-K with the Commission disclosing all material terms of
the transactions contemplated hereunder, including this letter agreement as an exhibit thereto with the Commission. From and after the
issuance of such press release or filing of such Current Report on Form 8-K, as applicable, the Company represents to you that it shall
have publicly disclosed all material, non-public information delivered to you by the Company, or any of its respective officers, directors,
employees or agents in connection with the transactions contemplated hereunder. In addition, effective upon the issuance of such press
release and/or filing of such Current Report on Form 8-K, the Company acknowledges and agrees that any and all confidentiality or similar
obligations under any agreement, whether written or oral, between the Company, any of its Subsidiaries or any of their respective officers,
directors, agents, employees or Affiliates on the one hand, and you and your Affiliates on the other hand, shall terminate. The Company
represents, warrants and covenants that, upon acceptance of this offer, and upon issuance of the Warrant Shares, the Warrant Shares shall
be issued free of any legends or restrictions on resale by Holder.
4
No
later than the first (1st) Trading Day following the date hereof, the closing (“Closing”) shall occur at
such location as the parties shall mutually agree. Unless otherwise directed by A.G.P./Alliance Global Partners. (the “Placement
Agent”), settlement of the Warrant Shares shall occur via “Delivery Versus Payment” (“DVP”)
(i.e., on the Closing Date, the Company shall issue the Warrant Shares registered in the Holder’s name and address provided to
the Company in writing and released by the Transfer Agent directly to the account(s) at the Placement Agent identified by the Holder;
upon receipt of such Warrant Shares, the Placement Agent shall promptly electronically deliver such Warrant Shares to the Holder, and
payment therefor shall concurrently be made to the Company by the Placement Agent (or its clearing firm) by wire transfer to the Company).
The date of the Closing of the exercise of the Existing Warrants shall be referred to as the “Closing Date”.
Governing
Law. All questions concerning the construction, validity, enforcement and interpretation of this letter agreement shall be governed
by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of conflicts
of law thereof. Each party agrees that all legal proceedings concerning the interpretations, enforcement and defense of the transactions
contemplated by this letter agreement and the New Warrant (whether brought against a party hereto or its respective affiliates, directors,
officers, shareholders, partners, members, employees or agents) shall be commenced exclusively in the state and federal courts sitting
in the City of New York. Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting
in the City of New York, Borough of Manhattan for the adjudication of any dispute hereunder or in connection herewith or with any transaction
contemplated hereby or discussed herein (including with respect to the enforcement of any of this letter agreement and the New Warrant),
and hereby irrevocably waives, and agrees not to assert in any action or proceeding, any claim that it is not personally subject to the
jurisdiction of any such court, that such action or proceeding is improper or is an inconvenient venue for such proceeding. Each party
hereby irrevocably waives personal service of process and consents to process being served in any such action or proceeding by mailing
a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect
for notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law.
If any party shall commence an action or proceeding to enforce any provisions of this letter agreement or the New Warrant, then, in addition
to the obligations of the Company under the following paragraph, the prevailing party in such action or proceeding shall be reimbursed
by the non-prevailing party for its reasonable attorneys’ fees and other costs and expenses incurred with the investigation, preparation
and prosecution of such action or proceeding.
5
Indemnification.
Subject to the provisions of this paragraph, the Company will indemnify and hold each Holder and its directors, officers, shareholders,
members, partners, employees and agents (and any other Persons with a functionally equivalent role of a Person holding such titles notwithstanding
a lack of such title or any other title), each Person who controls each Holder (within the meaning of Section 15 of the Securities Act
and Section 20 of the Exchange Act), and the directors, officers, shareholders, agents, members, partners or employees (and any other
Persons with a functionally equivalent role of a Person holding such titles notwithstanding a lack of such title or any other title)
of such controlling persons (each, a “Holder Party”) harmless from any and all losses, liabilities, obligations, claims,
contingencies, damages, costs and expenses, including all judgments, amounts paid in settlements, court costs and reasonable attorneys’
fees and costs of investigation that any such Holder Party may suffer or incur as a result of or relating to (a) any material breach
of any of the representations, warranties, covenants or agreements made by the Company in this offer letter or the New Warrant or (b)
any action instituted against each Holder Parties in any capacity, or any of them or their respective Affiliates, by any stockholder
of the Company who is not an Affiliate of such Holder Party, with respect to any of the transactions contemplated by this offer letter
or the New Warrant (unless such action is solely based upon a material breach of such Holder Party’s representations, warranties
or covenants under this offer letter or any agreements or understandings such Holder Party may have with any such stockholder or any
violations by such Holder Party of state or federal securities laws or any conduct by such Holder Party which is finally judicially determined
to constitute fraud, gross negligence or willful misconduct). If any action shall be brought against any Holder Party in respect of which
indemnity may be sought pursuant to this Agreement, such Holder Party shall promptly notify the Company in writing, and the Company shall
have the right to assume the defense thereof with counsel of its own choosing reasonably acceptable to each Holder Party. Any Holder
Party shall have the right to employ separate counsel in any such action and participate in the defense thereof, but the fees and expenses
of such counsel shall be at the expense of such Holder Party except to the extent that (x) the employment thereof has been specifically
authorized by the Company in writing, (y) the Company has failed after a reasonable period of time to assume such defense and to employ
counsel or (z) in such action there is, in the reasonable opinion of counsel, a material conflict on any material issue between the position
of the Company and the position of such Holder Party, in which case the Company shall be responsible for the reasonable fees and expenses
of no more than one such separate counsel. The Company will not be liable to any Holder Party under this Agreement (1) for any settlement
by a Holder Party effected without the Company’s prior written consent, which shall not be unreasonably withheld or delayed; or
(2) to the extent, but only to the extent that a loss, claim, damage or liability is attributable to any Holder Party’s breach
of any of the representations, warranties, covenants or agreements made by such Holder Party in this offer letter or the New Warrant.
The indemnification required by this paragraph shall be made by periodic payments of the amount thereof during the course of the investigation
or defense, as and when bills are received or are incurred; provided, however, that if it is subsequently determined by a final, non-appealable
judgment of a court of competent jurisdiction that each Holder was not entitled to receive such payments, each Holder shall promptly
(but in no event later than five (5) Business Days) return such payments to the Company. The indemnity agreements contained herein shall
be in addition to any cause of action or similar right of any Holder Party against the Company or others and any liabilities the Company
may be subject to pursuant to law; provided that the Company shall not be obligated to make aggregate indemnity payments hereunder in
excess of the aggregate purchase price received hereunder.
Notices.
Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall be in writing and shall
be deemed given and effective on the earliest of: (a) the time of transmission, if such notice or communication is delivered via email
attachment at the email address as set forth on the signature pages attached hereto at or prior to 5:30 p.m. (New York City time) on
a Trading Day, (b) the next Trading Day after the time of transmission, if such notice or communication is delivered via email attachment
at the email address as set forth on the signature pages attached hereto on a day that is not a Trading Day or later than 5:30 p.m. (New
York City time) on any Trading Day, (c) the second (2nd) Trading Day following the date of mailing, if sent by U.S. nationally recognized
overnight courier service or (d) upon actual receipt by the party to whom such notice is required to be given. The address for such notices
and communications shall be as set forth on the signature pages attached hereto.
“Person”
means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability
company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.
[Signature
page follows]
6
Sincerely
yours,
CYCURION,
INC.
By:
/s/
L. Kevin Kelly
Name:
L.
Kevin Kelly
Title:
Chief
Executive Officer
[Cycurion,
Inc. Signature Page to Warrant Inducement Agreement]
HOLDER
SIGNATURE PAGE TO
CYCURION, Inc. Warrant Inducement Agreement
Accepted
and Agreed to:
Name
of Holder: Armistice Capital Master Fund Ltd. _____________________________________
Signature
of Authorized Signatory of Holder: /s/ Steve Boyd _______________________________
Name
of Authorized Signatory: Steve Boyd ____________________________________________
Title
of Authorized Signatory: CIO of Armistice Capital LLC, the Investment Manager ____________
Number
of Existing Warrants: 3,341,439 _______________________________________________
Aggregate
Warrant Exercise Price being exercised contemporaneously with signing this letter agreement: $1.35 ________________________________________
Existing
Warrants Beneficial Ownership Blocker: ☐ 4.99% or ☒ 9.99%
New
Warrants: (up to 150% of total Existing Warrants being exercised): 5,012,159 ________________
New
Warrants Beneficial Ownership Blocker: ☒ 4.99% or ☐ 9.99%
DTC
Instructions: sep cover ____________________________________
[Holder
Signature Page to Cycurion, Inc. Warrant Inducement Agreement]
Annex
A
Representations,
Warranties and Covenants of the Company. The Company hereby makes the following representations and warranties to the Holder:
(a) SEC
Reports. The Company has filed all reports, schedules, forms, statements and other documents
required to be filed by the Company under the Exchange Act, including pursuant to Section
13(a) or 15(d) thereof, for the two years preceding the date hereof (or such shorter period
as the Company was required by law or regulation to file such material) (the foregoing materials,
including the exhibits thereto and documents incorporated by reference therein “SEC
Reports”). As of their respective dates, the SEC Reports complied in all material
respects with the requirements of the Exchange Act and none of the SEC Reports, when filed,
contained any untrue statement of a material fact or omitted to state a material fact required
to be stated therein or necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading except as otherwise noted in
a subsequent SEC Report.
(b) Authorization;
Enforcement. The Company has the requisite corporate power and authority to enter into
and to consummate the transactions contemplated by this letter agreement and otherwise to
carry out its obligations hereunder. The execution and delivery of this letter agreement
by the Company and the consummation by the Company of the transactions contemplated hereby
have been duly authorized by all necessary action on the part of the Company and no further
action is required by the Company, its board of directors or its stockholders in connection
herewith, if applicable. This letter agreement has been duly executed by the Company and,
when delivered in accordance with the terms hereof, will constitute the valid and binding
obligation of the Company enforceable against the Company in accordance with its terms, except
(i) as limited by general equitable principles and applicable bankruptcy, insolvency, reorganization,
moratorium and other laws of general application affecting enforcement of creditors’
rights generally, (ii) as limited by laws relating to the availability of specific performance,
injunctive relief or other equitable remedies and (iii) insofar as indemnification and contribution
provisions may be limited by applicable law. The New Warrants and New Warrant Shares are
duly authorized and the New Warrant Shares, when issued and paid for in accordance with the
terms of this letter and the New Warrants, will be duly and validly issued, fully paid and
nonassessable, free and clear of all liens imposed by the Company. The New Warrants constitute
valid and binding obligations of the Company, enforceable against the Company in accordance
with their respective terms, except: (i) as such enforceability may be limited by bankruptcy,
insolvency, reorganization or similar laws affecting the rights of creditors generally and
subject to general principles of equity.
A-1
(c) No
Conflicts. The execution, delivery and performance of this letter agreement by the Company
and the consummation by the Company of the transactions contemplated hereby do not and will
not: (i) conflict with or violate any provision of the Company’s certificate or articles
of incorporation, bylaws or other organizational or charter documents; or (ii) conflict with,
or constitute a default (or an event that with notice or lapse of time or both would become
a default) under, result in the creation of any liens, claims, security interests, other
encumbrances or defects upon any of the properties or assets of the Company in connection
with, or give to others any rights of termination, amendment, acceleration or cancellation
(with or without notice, lapse of time or both) of, any material agreement, credit facility,
debt or other material instrument (evidencing Company debt or otherwise) or other material
understanding to which such Company is a party or by which any property or asset of the Company
is bound or affected; or (iii) conflict with or result in a violation of any law, rule, regulation,
order, judgment, injunction, decree or other restriction of any court or governmental authority
to which the Company is subject (including federal and state securities laws and regulations),
or by which any property or asset of the Company is bound or affected, except, in the case
of each of clauses (ii) and (iii), such as could not have or reasonably be expected to result
in a material adverse effect upon the business, prospects, properties, operations, condition
(financial or otherwise) or results of operations of the Company, taken as a whole, or in
its ability to perform its obligations under this letter agreement.
(d) Registration
Obligations. As soon as reasonably practicable (and in any event within ninety (90) calendar
days following the date of this letter agreement), the Company shall file a registration
statement on Form S-1 or S-3 providing for the resale of the New Warrant Shares by the holders
of the New Warrants (the “Resale Registration Statement”). The Company
shall use commercially reasonable efforts to cause the Resale Registration Statement to become
effective within ninety (120) calendar days following the date of this letter agreement (or
within one hundred twenty (180) calendar days following the date of this letter agreement
in case of a review of such registration statement by the Commission) and to keep the Resale
Registration Statement effective at all times until no holder of the New Warrants owns any
New Warrants or New Warrant Shares.
(e) Trading
Market. Except for as related to the Stockholder Approval, the transactions contemplated
under this letter agreement comply with all the rules and regulations of the Nasdaq Capital
Market.
(f) Filings,
Consents and Approvals. The Company is not required to obtain any consent, waiver, authorization
or order of, give any notice to, or make any filing or registration with, any court or other
federal, state, local or other governmental authority or other Person in connection with
the execution, delivery and performance by the Company of this letter agreement, other than:
(i) the filings required pursuant to this letter agreement; and (ii) application(s) or notice
to each applicable Trading Market for the listing of the New Warrants and New Warrant Shares
for trading thereon in the time and manner required thereby.
A-2
(g) Listing
of Shares of Common Stock. The Holder is fully aware of, and has reviewed all of the
Company’s public filings on EDGAR since January 1, 2025. The Company agrees, if the
Company applies to have the Shares of Common Stock traded on any other Trading Market, it
will then include in such application all of the New Warrant Shares, and will take such other
action as is necessary to cause all of the New Warrant Shares to be listed or quoted on such
other Trading Market as promptly as possible. The Company will then take all action reasonably
necessary to continue the listing and trading of its Shares of Common Stock on a Trading
Market and will comply in all respects with the Company’s reporting, filing and other
obligations under the bylaws or rules of the Trading Market. The Company agrees to maintain
the eligibility of the Shares of Common Stock for electronic transfer through the Depository
Trust Company or another established clearing corporation, including, without limitation,
by timely payment of fees to the Depository Trust Company or such other established clearing
corporation in connection with such electronic transfer. In addition, and if applicable,
the Company shall hold an annual or special meeting of stockholders on or prior to the date
that is ninety (90) days following the Closing Date for the purpose of obtaining Stockholder
Approval, with the recommendation of the Company’s Board of Directors that such proposals
are approved, and the Company shall solicit proxies from its stockholders in connection therewith
in the same manner as all other management proposals in such proxy statement and all management-appointed
proxyholders shall vote their proxies in favor of such proposals. If the Company does not
obtain Stockholder Approval at the first meeting, the Company shall call a meeting not more
frequently than every ninety (90) days thereafter to seek Stockholder Approval until the
earlier of the date on which Stockholder Approval is obtained or the New Warrants are no
longer outstanding. The Company shall set the record date for Stockholder Approval prior
to the Closing Date.
(h) Subsequent
Equity Sales.
i. Until
fifteen (15) days following the Closing Date, neither the Company nor any Subsidiary shall
(A) issue, enter into any agreement to issue or announce the issuance or proposed issuance
of any Shares of Common Stock or Shares of Common Stock Equivalents or (B) file any registration
statement or any amendment or supplement to any existing registration statement (other than
registration statement File No: 333-297-262); provided, however, that the foregoing shall
not apply to: (i) any Exempt Issuance; (ii) any issuance of securities in connection with
any bona fide acquisition, merger, business combination, joint venture, strategic investment,
strategic alliance, commercial partnership, licensing arrangement, technology transaction,
asset acquisition, asset purchase, financing transaction, commercial transaction or other
strategic transaction approved by the Board of Directors, including any securities issued
at signing or closing thereof or thereafter pursuant to earn-outs, milestone payments, escrows,
contingent consideration or similar arrangements; (iii) the filing of any registration statement,
resale registration statement, shelf registration statement, prospectus supplement, post-effective
amendment or other filing under the Securities Act relating to any transaction described
in clause (ii); (iv) the filing of any registration statement or other Securities Act filing
required pursuant to any contractual registration rights obligations existing as of the Closing
Date or entered into in connection with any transaction described in clause (ii);. “Exempt
Issuance” means the issuance of (a) securities or options to employees, officers
or directors of the Company pursuant to any stock or option plan duly adopted for such purpose,
by a majority of the non-employee members of the Board of Directors or a majority of the
members of a committee of non-employee directors established for such purpose for services
rendered to the Company, (b) securities upon the exercise or exchange of or conversion of
any securities issued hereunder and/or any securities exercisable or exchangeable for or
convertible into shares of Common Stock issued and outstanding on the date of this Agreement,
provided that such securities have not been amended since the date of this Agreement to increase
the number of such securities or to decrease the exercise price, exchange price or conversion
price of such securities (other than in connection with stock splits or combinations) or
to extend the term of such securities, and (c) securities issued in connection with acquisitions,
mergers, business combinations, asset acquisitions, strategic investments, joint ventures,
commercial partnerships, licensing transactions, technology transactions or other strategic
transactions approved by a majority of the disinterested directors of the Company, including
securities issued as earn-out consideration, milestone payments, contingent consideration
or similar arrangements, whether or not such securities are issued as restricted securities
and whether or not registration rights are granted in connection therewith. “Person”
means an individual or corporation, partnership, trust, incorporated or unincorporated association,
joint venture, limited liability company, joint stock company, government (or an agency or
subdivision thereof) or other entity of any kind.
A-3
ii. Until
ninety (90) days following the Closing Date, the Company shall be prohibited from effecting
or entering into an agreement to effect any issuance by the Company or any of its Subsidiaries
of shares of Common Stock or Shares of Common Stock Equivalents (or a combination of units
thereof) involving a Variable Rate Transaction; provided, however, that nothing herein
shall prohibit, restrict or limit the Company or any of its Subsidiaries from effecting transactions
pursuant to that certain Equity Purchase Agreement, dated April 7, 2025, by and between the
Company and Yield Point NY LLC after fifteen (15) days following the Closing Date, including
any sales, issuances, drawdowns, advance notices, registration statements, resale registration
statements, prospectus supplements or other transactions contemplated thereby, and such transactions
shall not constitute Variable Rate Transactions for purposes of this Agreement. “Variable
Rate Transaction” means a transaction in which the Company (i) issues or sells
any debt or equity securities that are convertible into, exchangeable or exercisable for,
or include the right to receive additional Shares of Common Stock either (A) at a conversion
price, exercise price or exchange rate or other price that is based upon and/or varies with
the trading prices of or quotations for the Shares of Common Stock at any time after the
initial issuance of such debt or equity securities, or (B) with a conversion, exercise or
exchange price that is subject to being reset at some future date after the initial issuance
of such debt or equity security or upon the occurrence of specified or contingent events
directly or indirectly related to the business of the Company or the market for the Shares
of Common Stock or (ii) enters into, or effects a transaction under, any agreement, including,
but not limited to, an equity line of credit or an “at the market offering”,
whereby the Company may issue securities at a future determined price regardless of whether
shares pursuant to such agreement have actually been issued and regardless of whether such
agreement is subsequently canceled. The Holder shall be entitled to obtain injunctive relief
against the Company to preclude any such issuance, which remedy shall be in addition to any
right to collect damages. “Shares of Common Stock Equivalents” means any
securities of the Company or its subsidiaries which would entitle the holder thereof to acquire
at any time shares of Common Stock, including, without limitation, any debt, preferred stock,
right, option, warrant or other instrument that is at any time convertible into or exercisable
or exchangeable for, or otherwise entitles the holder thereof to receive, shares of Common
Stock.
iii. Notwithstanding
the foregoing, this Section (h) shall not apply in respect of an Exempt Issuance
(i) Blue
Sky Filings. The Company shall take such action as the Company shall reasonably determine
is necessary in order to obtain an exemption for, or to qualify the New Warrants and New
Warrant Shares for, sale to the Holder at Closing under applicable securities or “Blue
Sky” laws of the states of the United States, and shall provide evidence of such actions
promptly upon request of any Holder.
A-4
Exhibit
A
Form of New Warrant
NEITHER
THIS SECURITY NOR THE SECURITIES FOR WHICH THIS SECURITY IS EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION
OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. THIS SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE
OF THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT WITH A REGISTERED BROKER-DEALER OR OTHER LOAN WITH A FINANCIAL
INSTITUTION THAT IS AN “ACCREDITED INVESTOR” AS DEFINED IN RULE 501(A) UNDER THE SECURITIES ACT OR OTHER LOAN SECURED BY
SUCH SECURITIES.
COMMON
STOCK PURCHASE WARRANT
CYCURION,
INC.
Warrant
Shares: 5,012,159
Issue
Date: August 1, 2026
THIS
COMMON STOCK PURCHASE WARRANT (the “Warrant”) certifies that, for value received, _______ or its assigns (the “Holder”)
is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter set forth, at any time or times
on or after the Stockholder Approval Date (the “Initial Exercise Date”) and on or prior to 5:00 p.m. (New York City
time) on the five-year anniversary of the Initial Exercise Date (the “Termination Date”) but not thereafter, to subscribe
for and purchase from CYCURION, INC., a Delaware corporation (the “Company”), up to 5,012,159 shares of common
stock, par value $0.0001 per share (the “Common Stock”) (as subject to adjustment hereunder, the “Warrant
Shares”). The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price, as defined
in Section 2(b).
Section
1. Definitions. Capitalized terms used and not otherwise defined herein shall have the meanings set forth in that certain
Warrant Inducement Agreement (the “Inducement Agreement”), dated July 30, 2026, between the Company and each purchaser
signatory thereto.
Section
2. Exercise
(a)
Exercise of Warrant. Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time
or times on or after the Initial Exercise Date (or the Stockholder Approval Date for the Warrants) and on or before the Termination Date
by delivery to the Company of a duly executed facsimile copy or PDF copy submitted by e-mail (or e-mail attachment) of the Notice of
Exercise in the form annexed hereto as Exhibit A (the “Notice of Exercise”). Within the earlier of (i)
one (1) Trading Day and (ii) the number of Trading Days comprising the Standard Settlement Period (as defined in Section 2(d)(i)
herein) following the date of exercise as aforesaid, the Holder shall deliver the aggregate Exercise Price for the number of Warrant
Shares specified in the applicable Notice of Exercise by wire transfer or cashier’s check drawn on a United States bank unless
the cashless exercise procedure specified in Section 2(c) below is specified in the applicable Notice of Exercise. No ink-original
Notice of Exercise shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of
Exercise be required. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this
Warrant to the Company until the Holder has purchased all of the Warrant Shares available hereunder and the Warrant has been exercised
in full, at which time, the Holder shall surrender this Warrant to the Company for cancellation within three (3) Trading Days of the
date on which the final Notice of Exercise is delivered to the Company. Partial exercises of this Warrant resulting in purchases of a
portion of the total number of Warrant Shares purchasable hereunder shall have the effect of lowering the outstanding number of Warrant
Shares purchasable hereunder by the number of Warrant Shares equal to the applicable number of Warrant Shares purchased in connection
with such partial exercise. The Holder and the Company shall maintain records showing the number of Warrant Shares purchased and the
date of such purchases. The Company shall deliver any objection to any Notice of Exercise within one (1) Trading Day of receipt of such
notice. The Holder and any assignee, by acceptance of this Warrant, acknowledge and agree that, by reason of the provisions of this paragraph,
following the purchase of a portion of the Warrant Shares hereunder, the number of Warrant Shares available for purchase hereunder at
any given time may be less than the amount stated on the face hereof.
(b)
Exercise Price. The exercise price per share of Common Stock under this Warrant shall be $1.65, subject to adjustment hereunder
(the “Exercise Price”).
(c)
Cashless Exercise. Notwithstanding anything to the contrary set forth herein, if at the time of exercise hereof there is no effective
registration statement registering, or the prospectus contained therein is not available for the issuance of, the Warrant Shares to the
Holder, then this Warrant may only be exercised, in whole or in part, at such time by means of a “cashless exercise” in which
the Holder shall be entitled to receive a number of Warrant Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:
(A)
= as applicable: (i) the VWAP on the Trading Day immediately preceding the date of the applicable Notice of Exercise if such Notice of
Exercise is (1) both executed and delivered pursuant to Section 2(a) hereof on a day that is not a Trading Day or (2) both executed
and delivered pursuant to Section 2(a) hereof on a Trading Day prior to the opening of “regular trading hours” (as
defined in Rule 600(b) of Regulation NMS promulgated under the federal securities laws) on such Trading Day, (ii) the Bid Price of the
Common Stock on the principal Trading Market as reported by Bloomberg L.P. (“Bloomberg”) as of the time of the Holder’s
execution of the applicable Notice of Exercise if such Notice of Exercise is executed during “regular trading hours” on a
Trading Day and is delivered within two (2) hours thereafter (including until two (2) hours after the close of “regular trading
hours” on a Trading Day) pursuant to Section 2(a) hereof or (iii) the VWAP on the date of the applicable Notice of Exercise
if the date of such Notice of Exercise is a Trading Day and such Notice of Exercise is both executed and delivered pursuant to Section
2(a) hereof after the close of “regular trading hours” on such Trading Day;
(B)
= the Exercise Price of this Warrant, as adjusted hereunder; and
(X)
= the number of Warrant Shares that would be issuable upon exercise of this Warrant in accordance with the terms of this Warrant if such
exercise were by means of a cash exercise rather than a cashless exercise.
If
Warrant Shares are issued in such a cashless exercise, the parties acknowledge and agree that in accordance with Section 3(a)(9) of the
Securities Act, the Warrant Shares shall take on the characteristics of the Warrants being exercised, and the holding period of the Warrant
Shares being issued may be tacked on to the holding period of this Warrant. The Company agrees not to take any position contrary to this
Section 2(c).
“Bid
Price” means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock
is then listed or quoted on a Trading Market, the bid price of the Common Stock for the time in question (or the nearest preceding date)
on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg (based on a Trading Day from 9:30 a.m.
(New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading Market, the VWAP of the Common Stock
for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the Common Stock is not then listed or quoted for
trading on OTCQB or OTCQX and if prices for the Common Stock are then reported on The Pink Open Market (or a similar organization or
agency succeeding to its functions of reporting prices), the most recent bid price per share of Common Stock so reported, or (d) in all
other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected in good faith by the
Purchasers of a majority in interest of the Securities then outstanding and reasonably acceptable to the Company, the fees and expenses
of which shall be paid by the Company.
“Trading
Day” means any day on which the Trading Market is open for trading, including any day on which the Trading Market is open for
trading for a period of time less than the customary time.
“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then listed
or quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest preceding date)
on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg (based on a Trading Day from 9:30 a.m.
(New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading Market, the volume weighted average price
of the Common Stock for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the Common Stock is not then
listed or quoted for trading on OTCQB or OTCQX and if prices for the Common Stock are then reported on The Pink Open Market (or a similar
organization or agency succeeding to its functions of reporting prices), the most recent bid price per share of Common Stock so reported,
or (d) in all other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected in good
faith by the Purchasers of a majority in interest of the Securities then outstanding and reasonably acceptable to the Company, the fees
and expenses of which shall be paid by the Company.
(d)
Mechanics of Exercise.
i.
Delivery of Warrant Shares Upon Exercise. The Company shall cause the Warrant Shares purchased hereunder to be transmitted to
the Holder by crediting the account of the Holder’s or its designee’s balance account with The Depository Trust Company through
its Deposit or Withdrawal at Custodian system (“DWAC”) if the Company is then a participant in such system and either
(A) there is an effective registration statement permitting the issuance of the Warrant Shares to or resale of the Warrant Shares by
Holder or (B) the Warrant Shares are eligible for resale by the Holder without volume or manner-of-sale limitations pursuant to Rule
144 (assuming cashless exercise of the Warrant), and otherwise by physical delivery of the Warrant Shares, registered in the Company’s
share register in the name of the Holder or its designee, for the number of Warrant Shares set forth in the Notice of Exercise to the
address specified by the Holder in such Notice of Exercise by the date that is the earliest of (i) two (2) Trading Days after the delivery
to the Company of the Notice of Exercise, (ii) one (1) Trading Day after delivery of the aggregate Exercise Price to the Company, and
(iii) the number of Trading Days comprising the Standard Settlement Period after the delivery to the Company of the Notice of Exercise
(such date, the “Warrant Share Delivery Date”). Upon delivery of the Notice of Exercise, the Holder shall be deemed
for all corporate purposes to have become the holder of record of the Warrant Shares with respect to which this Warrant has been exercised,
irrespective of the date of delivery of the Warrant Shares, provided that payment of the aggregate Exercise Price (other
than in the case of a cashless exercise) is received within the earlier of (i) two (2) Trading Days and (ii) the number of Trading Days
comprising the Standard Settlement Period following delivery of the Notice of Exercise. If the Company fails for any reason to deliver
to the Holder the Warrant Shares subject to a Notice of Exercise by the Warrant Share Delivery Date, the Company shall pay to the Holder,
in cash, as liquidated damages and not as a penalty, for each $1,000 of Warrant Shares subject to such exercise (based on the VWAP of
the Common Stock on the date of the applicable Notice of Exercise), $10 per Trading Day (increasing to $20 per Trading Day on the fifth
Trading Day after the Warrant Share Delivery Date) for each Trading Day after such Warrant Share Delivery Date until such Warrant Shares
are delivered or Holder rescinds such exercise. The Company agrees to maintain a transfer agent (the “Transfer Agent”)
that is a participant in the FAST program so long as this Warrant remains outstanding and exercisable. As used herein, “Standard
Settlement Period” means the standard settlement period, expressed in a number of Trading Days, on the Company’s primary
Trading Market with respect to the Common Stock as in effect on the date of delivery of the Notice of Exercise. The Holder and any
assignee, by acceptance of this Warrant, acknowledge and agree that, by reason of the provisions of this paragraph, following the purchase
of a portion of the Warrant Shares hereunder, the number of Warrant Shares available for purchase hereunder at any given time will be
less than the amount stated on the face hereof.
ii.
Delivery of New Warrants Upon Exercise. If this Warrant shall have been exercised in part, the Company shall, at the request of
a Holder and upon surrender of this Warrant certificate, at the time of delivery of the Warrant Shares, deliver to the Holder a new Warrant
evidencing the rights of the Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant shall in
all other respects be identical with this Warrant.
iii.
Rescission Rights. If the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares pursuant to Section
2(d)(i) by the Warrant Share Delivery Date, then the Holder will have the right to rescind such exercise.
iv.
Compensation for Buy-In on Failure to Timely Deliver Warrant Shares Upon Exercise. In addition to any other rights available to
the Holder, if the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares in accordance with the provisions
of Section 2(d)(i) above pursuant to an exercise on or before the Warrant Share Delivery Date, and if after such date the Holder
is required by its broker to purchase (in an open market transaction or otherwise) or the Holder’s brokerage firm otherwise purchases,
shares of Common Stock to deliver in satisfaction of a sale by the Holder of the Warrant Shares which the Holder anticipated receiving
upon such exercise (a “Buy-In”), then the Company shall (A) pay in cash to the Holder the amount, if any, by which
(x) the Holder’s total purchase price (including brokerage commissions, if any) for the Warrant Shares so purchased exceeds (y)
the amount obtained by multiplying (1) the number of Warrant Shares that the Company was required to deliver to the Holder in connection
with the exercise at issue times (2) the price at which the sell order giving rise to such purchase obligation was executed, and (B)
at the option of the Holder, either reinstate the portion of the Warrant and equivalent number of Warrant Shares for which such exercise
was not honored (in which case such exercise shall be deemed rescinded) or deliver to the Holder the number of shares of Common Stock
that would have been issued had the Company timely complied with its exercise and delivery obligations hereunder. For example, if the
Holder purchases shares of Common Stock having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted exercise
of Warrants with an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (A) of the immediately preceding
sentence the Company shall be required to pay the Holder $1,000. The Holder shall provide the Company written notice indicating the amounts
payable to the Holder in respect of the Buy-In and, upon request of the Company, evidence satisfactory to the Company with respect to
the amount of such loss. Nothing herein shall limit a Holder’s right to pursue any other remedies available to it hereunder, at
law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s
failure to timely deliver Warrant Shares upon exercise of the Warrant as required pursuant to the terms hereof.
v.
No Fractional Shares or Scrip. No fractional Warrant Shares or scrip representing fractional Warrant Shares shall be issued upon
the exercise of this Warrant. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such exercise,
the Company shall, at its election and in lieu of the issuance of such fractional Warrant Share, either (i) pay cash in an amount equal
to such fraction multiplied by the Exercise Price or (ii) round up to the next whole Warrant Share.
vi.
Charges, Taxes and Expenses. The issuance and delivery of Warrant Shares shall be made without charge to the Holder for any issue
or transfer tax or other incidental expense in respect of the issuance of such Warrant Shares, all of which taxes and expenses shall
be paid by the Company, and such Warrant Shares shall be issued in the name of the Holder or in such name or names as may be directed
by the Holder; provided, however, that, in the event that Warrant Shares are to be issued in a name other
than the name of the Holder, the Notice of Exercise shall be accompanied by the Assignment Form, attached hereto as Exhibit B,
duly executed by the Holder and the Company may require, as a condition thereto, the payment of a sum sufficient to reimburse it for
any transfer tax incidental thereto and this Warrant shall be surrendered to the Company and, if any portion of this Warrant remains
unexercised, a new Warrant in the form hereof shall be delivered to the assignee. The Company shall pay all Transfer Agent fees required
for same-day processing of any Notice of Exercise and all fees to the Depository Trust Company (or another established clearing corporation
performing similar functions) required for same-day electronic delivery of the Warrant Shares.
vii.
Closing of Books. The Company will not close its stockholder books or records in any manner which prevents the timely exercise
of this Warrant, pursuant to the terms hereof.
(e)
Holder’s Exercise Limitations. The Company shall not effect any exercise of this Warrant, and a Holder shall not have the
right to exercise all or any portion of this Warrant, pursuant to Section 2 or otherwise, to the extent that after giving effect
to such issuance upon exercise as set forth on the applicable Notice of Exercise, the Holder (together with (i) the Holder’s Affiliates,
(ii) any other Persons acting as a group together with the Holder or any of the Holder’s Affiliates, and (iii) any other Persons
whose beneficial ownership of the shares of Common Stock would or could be aggregated with the Holder’s for the purposes of Section
13(d) (such Persons, “Attribution Parties”)), would beneficially own in excess of the Beneficial Ownership Limitation
(as defined below). For purposes of the foregoing sentence, the number of shares of Common Stock beneficially owned by the Holder and
its Affiliates and Attribution Parties shall include the number of shares of Common Stock issuable upon exercise of this Warrant with
respect to which such determination is being made, but shall exclude the number of the Warrant Shares which would be issuable upon (i)
exercise of the remaining, nonexercised portion of this Warrant beneficially owned by the Holder or any of its Affiliates or Attribution
Parties and (ii) exercise or conversion of the unexercised or nonconverted portion of any other securities of the Company (including,
without limitation, any other Common Stock Equivalents) subject to a limitation on conversion or exercise analogous to the limitation
contained herein beneficially owned by the Holder or any of its Affiliates or Attribution Parties. Except as set forth in the preceding
sentence, for purposes of this Section 2(e), beneficial ownership shall be calculated in accordance with Section 13(d) of the
Exchange Act and the rules and regulations promulgated thereunder, it being acknowledged by the Holder that the Company is not representing
to the Holder that such calculation is in compliance with Section 13(d) of the Exchange Act and the Holder is solely responsible for
any schedules required to be filed in accordance therewith. To the extent that the limitation contained in this Section 2(e) applies,
the determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates
and Attribution Parties) and of which portion of this Warrant is exercisable shall be in the sole discretion of the Holder, and the submission
of a Notice of Exercise shall be deemed to be the Holder’s determination of whether this Warrant is exercisable (in relation to
other securities owned by the Holder together with any Affiliates and Attribution Parties) and of which portion of this Warrant is exercisable,
in each case subject to the Beneficial Ownership Limitation, and the Company shall have no obligation to verify or confirm the accuracy
of such determination. In addition, a determination as to any group status as contemplated above shall be determined in accordance with
Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. For purposes of this Section 2(e), in
determining the number of outstanding shares of Common Stock, a Holder may rely on the number of outstanding shares of Common Stock as
reflected in (A) the Company’s most recent periodic or annual report filed with the Commission, as the case may be, (B) a more
recent public announcement by the Company or (C) a more recent written notice by the Company or the Transfer Agent setting forth the
number of shares of Common Stock outstanding. Upon the written or oral request of a Holder, the Company shall within one Trading Day
confirm orally and in writing to the Holder the number of shares of Common Stock then outstanding. In any case, the number of outstanding
shares of Common Stock shall be determined after giving effect to the conversion or exercise of securities of the Company, including
this Warrant, by the Holder or its Affiliates or Attribution Parties since the date as of which such number of outstanding shares of
Common Stock was reported. The “Beneficial Ownership Limitation” shall be [4.99%/9.99%] of the number of shares of Common
Stock outstanding immediately after giving effect to the issuance of Warrant Shares issuable upon exercise of this Warrant. The Holder,
upon notice to the Company, may increase or decrease the Beneficial Ownership Limitation provisions of this Section 2(e), provided
that the Beneficial Ownership Limitation in no event exceeds 9.99% of the number of shares of Common Stock outstanding immediately
after giving effect to the issuance of Warrant Shares upon exercise of this Warrant held by the Holder and the provisions of this Section
2(e) shall continue to apply. Any increase in the Beneficial Ownership Limitation will not be effective until the sixty-first (61st)
day after such notice is delivered to the Company. The provisions of this paragraph shall be construed and implemented in a manner otherwise
than in strict conformity with the terms of this Section 2(e) to correct this paragraph (or any portion hereof) which may be defective
or inconsistent with the intended Beneficial Ownership Limitation herein contained or to make changes or supplements necessary or desirable
to properly give effect to such limitation. The limitations contained in this paragraph shall apply to a successor holder of this Warrant.
Section
3. Certain Adjustments.
(a)
Stock Dividends and Splits. If the Company, at any time while this Warrant is outstanding: (i) pays a stock dividend or otherwise
makes a distribution or distributions on shares of Common Stock or any other equity or equity equivalent securities payable in shares
of Common Stock (which, for avoidance of doubt, shall not include any Warrant Shares issued by the Company upon exercise of this Warrant),
(ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines (including by way of reverse stock
split) outstanding shares of Common Stock into a smaller number of shares, or (iv) issues by reclassification of shares of Common Stock
any shares of capital stock of the Company, then in each case the Exercise Price shall be multiplied by a fraction of which the numerator
shall be the number of shares of Common Stock (excluding treasury shares, if any) outstanding immediately before such event and of which
the denominator shall be the number of shares of Common Stock outstanding immediately after such event, and the number of shares issuable
upon exercise of this Warrant shall be proportionately adjusted such that the aggregate Exercise Price of this Warrant remains unchanged.
Any adjustment made pursuant to this Section 3(a) shall become effective immediately after the record date for the determination
of stockholders entitled to receive such dividend or distribution and shall become effective immediately after the effective date in
the case of a subdivision, combination or reclassification.
(b)
RESERVED.
(c)
Subsequent Rights Offerings. In addition to any adjustments pursuant to Section 3(a) above, if at any time the Company
grants, issues or sells any Common Stock Equivalents or rights to purchase stock, warrants, securities or other property pro rata to
the record holders of any class of Common Stock (the “Purchase Rights”), then the Holder will be entitled to acquire,
upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired if the Holder had
held the number of shares of Common Stock acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise
hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the date on which a record is taken for
the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of shares
of Common Stock are to be determined for the grant, issue or sale of such Purchase Rights (provided, however,
that, to the extent that the Holder’s right to participate in any such Purchase Right would result in the Holder exceeding the
Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Purchase Right to such extent (or beneficial
ownership of such shares of Common Stock as a result of such Purchase Right to such extent) and such Purchase Right to such extent shall
be held in abeyance for the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial
Ownership Limitation).
(d)
Pro Rata Distributions. During such time as this Warrant is outstanding, if the Company shall declare or make any dividend or
other distribution of its assets (or rights to acquire its assets) to holders of shares of Common Stock, by way of return of capital
or otherwise (including, without limitation, any distribution of cash, stock or other securities, property or options by way of a dividend,
spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a “Distribution”),
at any time after the issuance of this Warrant, then, in each such case, the Holder shall be entitled to participate in such Distribution
to the same extent that the Holder would have participated therein if the Holder had held the number of shares of Common Stock acquirable
upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including without limitation, the Beneficial
Ownership Limitation) immediately before the date of which a record is taken for such Distribution, or, if no such record is taken, the
date as of which the record holders of shares of Common Stock are to be determined for the participation in such Distribution (provided,
however, that, to the extent that the Holder’s right to participate in any such Distribution would result in the
Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Distribution to such
extent (or in the beneficial ownership of any shares of Common Stock as a result of such Distribution to such extent) and the portion
of such Distribution shall be held in abeyance for the benefit of the Holder until such time, if ever, as its right thereto would not
result in the Holder exceeding the Beneficial Ownership Limitation).
(e)
Fundamental Transaction. If, at any time while this Warrant is outstanding, (i) the Company, directly or indirectly, in one or
more related transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company (or any Subsidiary),
directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially
all of the Company’s assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer
or exchange offer (whether by the Company or another Person) is completed pursuant to which holders of Common Stock are permitted to
sell, tender or exchange their shares for other securities, cash or property and has been accepted by the holders of more than 50% of
the voting power of the common equity of the Company, (iv) the Company, directly or indirectly, in one or more related transactions effects
any reclassification, reorganization or recapitalization of shares of Common Stock or any compulsory share exchange pursuant to which
the shares of Common Stock are effectively converted into or exchanged for other securities, cash or property, or (v) the Company, directly
or indirectly, in one or more related transactions consummates a stock or share purchase agreement or other business combination (including,
without limitation, a reorganization, recapitalization, spin-off, merger or scheme of arrangement) with another Person or group of Persons
whereby such other Person or group acquires more than 50% of the voting power of the common equity of the Company (each a “Fundamental
Transaction”), then, upon any subsequent exercise of this Warrant, the Holder shall have the right to receive, for each Warrant
Share that would have been issuable upon such exercise immediately prior to the occurrence of such Fundamental Transaction, at the option
of the Holder (without regard to any limitation in Section 2(e) on the exercise of this Warrant), the number of shares of Common
Stock of the successor or acquiring corporation or of the Company, if it is the surviving corporation, and any additional consideration
(the “Alternate Consideration”) receivable as a result of such Fundamental Transaction by a holder of the number of
shares of Common Stock for which this Warrant is exercisable immediately prior to such Fundamental Transaction (without regard to any
limitation in Section 2(e) on the exercise of this Warrant). For purposes of any such exercise, the determination of the Exercise
Price shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration issuable
in respect of one share of Common Stock in such Fundamental Transaction, and the Company shall apportion the Exercise Price among the
Alternate Consideration in a reasonable manner reflecting the relative value of any different components of the Alternate Consideration.
If holders of Common Stock are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then
the Holder shall be given the same choice as to the Alternate Consideration it receives upon any exercise of this Warrant following such
Fundamental Transaction. Notwithstanding anything to the contrary, in the event of a Fundamental Transaction, the Company or any Successor
Entity (as defined below) shall, at the Holder’s option, exercisable at any time concurrently with, or within thirty (30) days
after, the consummation of the Fundamental Transaction (or, if later, the date of the public announcement of the applicable Fundamental
Transaction), purchase this Warrant from the Holder by paying to the Holder, as described below, an amount of consideration equal to
the Black Scholes Value (as defined below) of the remaining unexercised portion of this Warrant on the date of the consummation of such
Fundamental Transaction, provided, however, that, if the Fundamental Transaction is not within the Company’s
control, including not approved by the Company’s Board of Directors, Holder shall only be entitled to receive from the Company
or any Successor Entity, as of the date of the consummation of such Fundamental Transaction the same type or form of consideration (and
in the same proportion), valued at the Black Scholes Value of the unexercised portion of this Warrant, that is being offered and paid
to the holders of Common Stock of the Company in connection with the Fundamental Transaction, whether that consideration be in the form
of cash, stock or any combination thereof, or whether the holders of Common Stock are given the choice to receive from among alternative
forms of consideration in connection with the Fundamental Transaction; provided further, that if holders of Common Stock
of the Company are not offered or paid any consideration in such Fundamental Transaction, such holders of Common Stock will be deemed
to have received shares of the Successor Entity (which Successor Entity may be the Company following such Fundamental Transaction) in
such Fundamental Transaction. “Black Scholes Value” means the value of this Warrant based on the Black-Scholes Option Pricing
Model obtained from the “OV” function on Bloomberg, L.P. (“Bloomberg”) determined as of the day of consummation
of the applicable Fundamental Transaction for pricing purposes and reflecting (A) a risk-free interest rate corresponding to the U.S.
Treasury rate for a period equal to the time between the date of the public announcement of the applicable contemplated Fundamental Transaction
and the Termination Date, (B) an expected volatility equal to the 100 day volatility obtained from the HVT function on Bloomberg (determined
utilizing a 365-day annualization factor) as of the Trading Day immediately following the public announcement of the applicable Fundamental
Transaction, (C) the underlying price per share used in such calculation shall be the sum of the price per share being offered in cash,
if any, plus the value of any non-cash consideration, if any, being offered in such Fundamental Transaction and (D) a remaining option
time equal to the time between the date of the public announcement of the applicable Fundamental Transaction and the Termination Date
and (E) a zero cost of borrow. The payment of the Black Scholes Value will be made by wire transfer of immediately available funds within
five Business Days of the Holder’s election (or, if later, on the effective date of the Fundamental Transaction). The Company shall
cause any successor entity in a Fundamental Transaction in which the Company is not the survivor (the “Successor Entity”)
to assume in writing all of the obligations of the Company under this Warrant and the other Transaction Documents in accordance with
the provisions of this Section 3(e) pursuant to written agreements in form and substance reasonably satisfactory to the Holder
prior to such Fundamental Transaction and shall, at the option of the Holder, deliver to the Holder in exchange for this Warrant a security
of the Successor Entity evidenced by a written instrument substantially similar in form and substance to this Warrant which is exercisable
for a corresponding number of shares of capital stock of such Successor Entity (or its parent entity) equivalent to the shares of Common
Stock acquirable and receivable upon exercise of this Warrant (without regard to any limitations on the exercise of this Warrant) prior
to such Fundamental Transaction, and with an exercise price which applies the exercise price hereunder to such shares of capital stock
(but taking into account the relative value of the shares of Common Stock pursuant to such Fundamental Transaction and the value of such
shares of capital stock, such number of shares of capital stock and such exercise price being for the purpose of protecting the economic
value of this Warrant immediately prior to the consummation of such Fundamental Transaction), and which is reasonably satisfactory in
form and substance to the Holder. Upon the occurrence of any such Fundamental Transaction, the Successor Entity shall succeed to, and
be substituted for (so that from and after the date of such Fundamental Transaction, the provisions of this Warrant and the other Transaction
Documents referring to the “Company” shall refer instead to the Successor Entity), and may exercise every right and power
of the Company and shall assume all of the obligations of the Company under this Warrant and the other Transaction Documents with the
same effect as if such Successor Entity had been named as the Company herein.
(f)
Calculations. All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share
of Common Stock, as the case may be. For purposes of this Section 3, the number of shares of Common Stock deemed to be issued
and outstanding as of a given date shall be the sum of the number of shares of Common Stock (excluding treasury shares, if any) issued
and outstanding.
(g)
Notice to Holder.
i.
Adjustment to Exercise Price. Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the
Company shall promptly deliver to the Holder by facsimile or email a notice setting forth the Exercise Price after such adjustment and
any resulting adjustment to the number of Warrant Shares and setting forth a brief statement of the facts requiring such adjustment.
ii.
Notice to Allow Exercise by Holder. If (A) the Company declares a dividend (or any other distribution in whatever form) on the
shares of Common Stock, (B) the Company declares a special nonrecurring cash dividend on or a redemption of the shares of Common Stock,
(C) the Company authorizes the granting to all holders of the shares of Common Stock rights or warrants to subscribe for or purchase
any shares of capital stock of any class or of any rights, (D) the approval of any shareholders of the Company is required in connection
with a Fundamental Transaction, or (E) the Company authorizes the voluntary or involuntary dissolution, liquidation or winding up of
the affairs of the Company, then, in each case, the Company shall cause to be delivered by facsimile or email to the Holder at its last
facsimile number or email address as it shall appear upon the Warrant Register of the Company, at least 20 calendar days prior to the
applicable record or effective date hereinafter specified, a notice stating (x) the date on which a record is to be taken for the purpose
of such dividend, distribution, redemption, rights or warrants, or if a record is not to be taken, the date as of which the holders of
the Common Stock of record to be entitled to such dividend, distributions, redemption, rights or warrants are to be determined or (y)
the date on which such reclassification, consolidation, merger, sale, transfer or share exchange is expected to become effective or close,
and the date as of which it is expected that holders of the Common Stock of record shall be entitled to exchange their shares of Common
Stock for securities, cash or other property deliverable upon such reclassification, consolidation, merger, sale, transfer or share exchange;
provided that the failure to deliver such notice or any defect therein or in the delivery thereof shall not affect the
validity of the corporate action required to be specified in such notice and provided, further that no notice shall be
required if the information is disseminated in a press release or document filed with the Commission. To the extent that any notice provided
in this Warrant constitutes, or contains, material, non-public information regarding the Company or any of the Subsidiaries, the Company
shall simultaneously file such notice with the Commission pursuant to a Current Report on Form 8-K. The Holder shall remain entitled
to exercise this Warrant during the period commencing on the date of such notice to the effective date of the event triggering such notice
except as may otherwise be expressly set forth herein.
(h)
Voluntary Adjustment By Company. Subject to the rules and regulations of the Trading Market, the Company may at any time while
this Warrant is outstanding, reduce the then-current Exercise Price to any amount and for any period of time deemed appropriate by the
board of directors of the Company in its sole discretion.
Section
4. Transfer of Warrant.
(a)
Transferability. Subject to compliance with any applicable securities laws and the conditions set forth herein, this Warrant and
all rights hereunder (including, without limitation, any registration rights) are transferable, in whole or in part, upon surrender of
this Warrant at the principal office of the Company or its designated agent, together with a written assignment of this Warrant substantially
in the form attached hereto as Exhibit B duly executed by the Holder or its agent or attorney and funds sufficient to pay
any transfer taxes payable upon the making of such transfer. Upon such surrender and, if required, such payment, the Company shall execute
and deliver a new Warrant or Warrants in the name of the assignee or assignees, as applicable, and in the denomination or denominations
specified in such instrument of assignment, and shall issue to the assignor a new Warrant evidencing the portion of this Warrant not
so assigned, and this Warrant shall promptly be cancelled. Notwithstanding anything herein to the contrary, the Holder shall not be required
to physically surrender this Warrant to the Company unless the Holder has assigned this Warrant in full, in which case, the Holder shall
surrender this Warrant to the Company within three (3) Trading Days of the date on which the Holder delivers an assignment form to the
Company assigning this Warrant in full. The Warrant, if properly assigned in accordance herewith, may be exercised by a new holder for
the purchase of Warrant Shares without having a new Warrant issued.
(b)
New Warrants. This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of
the Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by
the Holder or its agent or attorney. Subject to compliance with Section 4(a), as to any transfer which may be involved in such
division or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be
divided or combined in accordance with such notice. All Warrants issued on transfers or exchanges shall be dated the initial issuance
date of this Warrant and shall be identical with this Warrant except as to the number of Warrant Shares issuable pursuant thereto.
(c)
Warrant Register. The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the
“Warrant Register”), in the name of the record Holder hereof from time to time. The Company may deem and treat the
registered Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder,
and for all other purposes, absent actual notice to the contrary.
(d)
Transfer Restrictions. If, at the time of the surrender of this Warrant in connection with any transfer of this Warrant, the transfer
of this Warrant shall not be either (i) registered pursuant to an effective registration statement under the Securities Act and under
applicable state securities or blue sky laws or (ii) eligible for resale without volume or manner-of-sale restrictions or current public
information requirements pursuant to Rule 144, the Company may require, as a condition of allowing such transfer, that the Holder or
transferee of this Warrant, as the case may be, comply with the provisions of Section 5(f) of this Warrant.
(e)
Representation by the Holder. The Holder, by the acceptance hereof, represents and warrants that it is acquiring this Warrant
and, upon any exercise hereof, will acquire the Warrant Shares issuable upon such exercise, for its own account and not with a view to
or for distributing or reselling such Warrant Shares or any part thereof in violation of the Securities Act or any applicable state securities
law, except pursuant to sales registered or exempted under the Securities Act.
Section
5. Miscellaneous.
(a)
No Rights as Stockholder Until Exercise; No Settlement in Cash. This Warrant does not entitle the Holder to any voting rights,
dividends or other rights as a stockholder of the Company prior to the exercise hereof as set forth in Section 2(d)(i), except
as expressly set forth in Section 3. Without limiting any rights of a Holder to receive Warrant Shares on a “cashless exercise”
pursuant to Section 2(c) or to receive cash payments pursuant to Section 2(d)(i) and Section 2(d)(iv) herein, in
no event shall the Company be required to net cash settle an exercise of this Warrant.
(b)
Loss, Theft, Destruction or Mutilation of Warrant. The Company covenants that upon receipt by the Company of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any stock certificate relating to the Warrant Shares,
and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of the Warrant,
shall not include the posting of any bond), and upon surrender and cancellation of such Warrant or stock certificate, if mutilated, the
Company will make and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation, in lieu of such Warrant
or stock certificate.
(c)
Saturdays, Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required
or granted herein shall not be a Trading Day, then such action may be taken or such right may be exercised on the next succeeding Trading
Day.
(d)
Authorized Shares. The Company covenants that, during the period the Warrant is outstanding, it will reserve from its authorized
and unissued shares of Common Stock a sufficient number of shares to provide for the issuance of the Warrant Shares underlying this Warrant.
The Company further covenants that its issuance of this Warrant shall constitute full authority to its officers who are charged with
the duty of issuing the necessary Warrant Shares upon the exercise of the purchase rights under this Warrant. The Company will take all
such reasonable action as may be necessary to assure that such Warrant Shares may be issued, and the Warrant Shares, delivered, as provided
herein without violation of any applicable law or regulation, or of any requirements of the Trading Market upon which the Common Stock
may be listed. The Company covenants that all Warrant Shares underlying this Warrant, which may be issued upon the exercise of the purchase
rights represented by this Warrant will, upon exercise of the purchase rights represented by this Warrant and payment for such Warrant
Shares in accordance herewith, be duly authorized, validly issued, fully paid and nonassessable and free from all taxes, liens and charges
created by the Company in respect of the issue thereof (other than taxes in respect of any transfer occurring contemporaneously with
such issue).
Except
and to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending
its certificate of incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale
of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant,
but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary
or appropriate to protect the rights of Holder as set forth in this Warrant against impairment. Without limiting the generality of the
foregoing, the Company will (i) not increase the par value of any shares of Common Stock above the amount payable therefor upon such
exercise immediately prior to such increase in par value, (ii) take all such action as may be necessary or appropriate in order that
the Company may validly and legally issue fully paid and nonassessable shares of Common Stock upon the exercise of this Warrant and (iii)
use commercially reasonable efforts to obtain all such authorizations, exemptions or consents from any public regulatory body having
jurisdiction thereof, as may be, necessary to enable the Company to perform its obligations under this Warrant.
Before
taking any action which would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the
Exercise Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from
any public regulatory body or bodies having jurisdiction thereof.
Nothing
contained herein shall prohibit the Company from consummating any acquisition, merger, asset purchase, joint venture, strategic alliance,
licensing transaction or other strategic transaction approved by its Board of Directors.
(e)
Jurisdiction. All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be determined
in accordance with the provisions of the Inducement Agreement.
(f)
Restrictions. The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered, and
if the Holder does not utilize cashless exercise, will have restrictions upon resale imposed by state and federal securities laws.
(g)
Nonwaiver and Expenses. No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall
operate as a waiver of such right or otherwise prejudice the Holder’s rights, powers or remedies. Without limiting any other provision
of this Warrant or the Inducement Agreement, if the Company willfully and knowingly fails to comply with any provision of this Warrant,
which results in any material damages to the Holder, the Company shall pay to the Holder such amounts as shall be sufficient to cover
any costs and expenses including, but not limited to, reasonable attorneys’ fees, including those of appellate proceedings, incurred
by the Holder in collecting any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies hereunder.
(h)
Notices. Any notice, request or other document required or permitted to be given or delivered to the Holder by the Company shall
be delivered in accordance with the notice provisions of the Inducement Agreement.
(i)
Limitation of Liability. No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant
to purchase Warrant Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of
the Holder for the purchase price of any share of Common Stock or as a stockholder of the Company, whether such liability is asserted
by the Company or by creditors of the Company.
(j)
Remedies. The Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will
be entitled to specific performance of its rights under this Warrant. The Company agrees that monetary damages would not be adequate
compensation for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive and not to
assert the defense in any action for specific performance that a remedy at law would be adequate.
(k)
Successors and Assigns. Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall
inure to the benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted assigns
of Holder. The provisions of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant and shall
be enforceable by the Holder or holder of Warrant Shares.
(l)
Amendment. This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company and
the Holder.
(m)
Severability. Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall
be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining
provisions of this Warrant.
(n)
Headings. The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed
a part of this Warrant.
********************
[Signature
Page Follows]
IN
WITNESS WHEREOF, the Company has caused this Warrant to be executed by its officer thereunto duly authorized as of the date first above
indicated.
CYCURION,
INC.
By:
Name:
Title:
EXHIBIT
A
NOTICE
OF EXERCISE
TO:
CYCURION, INC.
(1)
The undersigned hereby elects to purchase ________ Warrant Shares of the Company pursuant to the terms of the attached Warrant (only
if exercised in full), and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes, if any.
(2)
Payment shall take the form of (check applicable box):
[
]
in
lawful money of the United States; or
[
]
if
permitted the cancellation of such number of Warrant Shares as is necessary, in accordance with the formula set forth in subsection
2(c), to exercise this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise
procedure set forth in subsection 2(c).
(3)
Please issue said Warrant Shares in the name of the undersigned or in such other name as is specified below:
The Warrant Shares shall be delivered to the following DWAC Account Number:
[SIGNATURE
OF HOLDER]
Name
of Investing Entity:
Signature
of Authorized Signatory of Investing Entity:
Name
of Authorized Signatory
Title
of Authorized Signature:
Date
EXHIBIT
B
ASSIGNMENT
FORM
(To
assign the foregoing Warrant, execute this form and supply required information. Do not use this form to purchase shares.)
FOR
VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby are hereby assigned to
Name:
(Please
Print)
Address:
(Please
Print)
Phone
Number
Address:
Dated:
_______________ ____, _______
Holder’s
Signature
Holder’s
Address
EX-99.1
EX-99.1
Filename: ex99-1.htm · Sequence: 4
Exhibit
99.1
Cycurion
Announces a Warrant Inducement Transaction for $4.5 Million in Gross Proceeds Priced At-the-Market Under Nasdaq Rules
MCLEAN,
Va., July 31, 2026 (GLOBE NEWSWIRE) ———— Cycurion, Inc. (Nasdaq: CYCU) (“Cycurion” or the “Company”),
a trusted leader in IT cybersecurity and AI-driven solutions, today announced its entry into a warrant inducement agreement with an existing
institutional investor of the Company for the immediate exercise of warrants to purchase up to 3,341,439 of the Company’s common
stock (the “Existing Warrants”) at an exercise price of $1.35 per share for gross cash proceeds of approximately $4.5 million,
before deducting fees and other transaction expenses. The Company intends to use the net proceeds from the warrant inducement transaction
for working capital and other general corporate purposes.
A.G.P./Alliance
Global Partners is acting as the exclusive financial advisor in this warrant inducement transaction.
In
consideration for the immediate exercise in full of the Existing Warrants, the investor will receive in a private placement new unregistered
warrants to purchase up to 5,012,159 of the Company’s common stock (the “New Warrants”), representing 150% of the number
of shares of common stock underlying the Existing Warrants exercised in the transaction. The New Warrants will have an exercise price
of $1.65 per share, will be initially exercisable upon shareholder approval, and will expire five (5) years from the date shareholder
approval is obtained. The closing of the warrant inducement transaction is expected to occur on or about August 3, 2026, subject to satisfaction
of customary closing conditions.
The
shares of common stock underlying the Existing Warrants are eligible to be resold pursuant to Rule 144 of the of Securities Act of 1933,
as amended (the “Securities Act”). The private placement of the New Warrants and the shares underlying the New Warrants offered
to the institutional investor will be made in reliance on an exemption from registration under Section 4(a)(2) of the Securities Act
and Regulation D promulgated thereunder. Accordingly, the securities issued in the private placement may not be offered or sold in the
United States except pursuant to an effective registration statement or an applicable exemption from the registration requirements of
the Securities Act and such applicable state securities laws. The Company has agreed to file a registration statement with the U.S. Securities
and Exchange Commission covering the resale of the shares of common stock issuable upon exercise of the New Warrants.
This
press release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in this warrant inducement
transaction, nor shall there be any sale of these securities in any state or other jurisdiction in which such offer, solicitation or
sale would be unlawful prior to the registration or qualification under the securities laws of any such state or other jurisdiction.
About
Cycurion, Inc.
Based
in McLean, Virginia, Cycurion (NASDAQ: CYCU) is a forward-thinking provider of IT cybersecurity solutions and AI, committed to delivering
secure, reliable, and innovative services to clients worldwide. Specializing in cybersecurity, program management, and business continuity,
Cycurion harnesses its AI-enhanced ARx platform and expert team to empower clients and safeguard their operations. Along with its subsidiaries,
Axxum Technologies LLC, Cloudburst Security LLC, and Cycurion Innovation, Inc., Cycurion serves government, healthcare, and corporate
clients committed to securing the digital future. For more information, visit www.cycurion.com.
Forward-Looking
Statements
This
press release contains forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995, including, but
not limited to, statements relating to the operations and prospective growth of Cycurion’s business.
Certain
statements in this press release that are not historical facts are forward-looking statements within the meaning of Section 27A of the
Securities Exchange Act of 1934, as amended. Any statements contained in this press release that are not statements of historical fact
may be deemed forward-looking statements. Such statements include, but are not limited to, statements regarding the expected closing
of the warrant inducement transaction, the satisfaction of closing conditions, the receipt and use of proceeds, shareholder approval
of the New Warrants, the future exercise of the New Warrants and the Company’s business and growth strategy; the acceleration of
the Company’s inorganic growth strategy; the continued execution on the Company’s backlog; and other statements that are
not historical facts, including statements which may be accompanied by words such as “continue,” “will,” “may,”
“could,” “should,” “expect,” “expected,” “plans,” “intend,” “anticipate,”
“believe,” “estimate,” “predict,” “potential,” and similar expressions are intended to
identify such forward-looking statements. All forward-looking statements involve significant risks and uncertainties that could cause
actual results to differ materially from those expressed or implied in the forward-looking statements, many of which are generally outside
the control of Cycurion and are difficult to predict. Examples of such risks and uncertainties include, but are not limited to, risks
related to customer performance and satisfaction, contract modifications, and delays; the outcomes of the Company’s investigations,
any potential legal proceedings, or the future performance of the Company’s stock. Additional factors that could cause actual results
to differ materially from those expressed or implied in the forward-looking statements can be found in the most recent annual report
on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K filed by Cycurion with the U.S. Securities and Exchange
Commission. Cycurion anticipates that subsequent events and developments may cause its plans, intentions, and expectations to change.
Cycurion assumes no obligation, and it specifically disclaims any intention or obligation, to update any forward-looking statements,
whether as a result of new information, future events, or otherwise, except as expressly required by law. Forward-looking statements
speak only as of the date they are made and should not be relied upon as representing Cycurion’s plans and expectations as of any
subsequent date.
Cycurion
Investor Relations:
(888)
341-6680
investors@cycurion.com
Cycurion
Media Relations:
(888)
341-6680
media@cycurion.com
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Aug. 03, 2026
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Redeemable warrants, each exercisable for one share of common stock at an exercise price of $345.00 per share
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- Definition
Two-character EDGAR code representing the state or country of incorporation.
+ References
No definition available.
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- Definition
The exact name of the entity filing the report as specified in its charter, which is required by forms filed with the SEC.
+ References
Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 12
-Subsection b-2
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- Definition
The Tax Identification Number (TIN), also known as an Employer Identification Number (EIN), is a unique 9-digit value assigned by the IRS.
+ References
Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 12
-Subsection b-2
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- Definition
Local phone number for entity.
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No definition available.
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- Definition
Boolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act.
+ References
Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 13e
-Subsection 4c
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Boolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act.
+ References
Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 14d
-Subsection 2b
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- Definition
Title of a 12(b) registered security.
+ References
Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 12
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Name of the Exchange on which a security is registered.
+ References
Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 12
-Subsection d1-1
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- Definition
Boolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as soliciting material pursuant to Rule 14a-12 under the Exchange Act.
+ References
Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 14a
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- Definition
Trading symbol of an instrument as listed on an exchange.
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No definition available.
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- Definition
Boolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as written communications pursuant to Rule 425 under the Securities Act.
+ References
Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Securities Act
-Number 230
-Section 425
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