<SEC-DOCUMENT>0001683168-17-002514.txt : 20170929
<SEC-HEADER>0001683168-17-002514.hdr.sgml : 20170929
<ACCEPTANCE-DATETIME>20170929073140
ACCESSION NUMBER:		0001683168-17-002514
CONFORMED SUBMISSION TYPE:	S-1/A
PUBLIC DOCUMENT COUNT:		4
FILED AS OF DATE:		20170929
DATE AS OF CHANGE:		20170929

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			AETHLON MEDICAL INC
		CENTRAL INDEX KEY:			0000882291
		STANDARD INDUSTRIAL CLASSIFICATION:	LABORATORY ANALYTICAL INSTRUMENTS [3826]
		IRS NUMBER:				133632859
		STATE OF INCORPORATION:			NV
		FISCAL YEAR END:			0331

	FILING VALUES:
		FORM TYPE:		S-1/A
		SEC ACT:		1933 Act
		SEC FILE NUMBER:	333-219589
		FILM NUMBER:		171109008

	BUSINESS ADDRESS:	
		STREET 1:		9635 GRANITE RIDGE DRIVE, SUITE 100
		CITY:			SAN DIEGO
		STATE:			CA
		ZIP:			92123
		BUSINESS PHONE:		858-459-7800

	MAIL ADDRESS:	
		STREET 1:		9635 GRANITE RIDGE DRIVE, SUITE 100
		CITY:			SAN DIEGO
		STATE:			CA
		ZIP:			92123

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	BISHOP EQUITIES INC
		DATE OF NAME CHANGE:	19930602
</SEC-HEADER>
<DOCUMENT>
<TYPE>S-1/A
<SEQUENCE>1
<FILENAME>aethlon_s1a4.htm
<DESCRIPTION>AMENDMENT NO. 4
<TEXT>
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<P STYLE="margin-top: 0; text-align: left; margin-bottom: 0"><A HREF="#a1"><FONT STYLE="font-size: 7pt">Table of Contents</FONT></A></P>

<P STYLE="margin-top: 0; text-align: center; margin-bottom: 0"><FONT STYLE="font-size: 8pt"><B>As filed with the Securities and
Exchange Commission on September 29, 2017 </B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: right"><FONT STYLE="font-size: 8pt"><B>Registration
No. 333 -219589 </B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>UNITED STATES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>SECURITIES AND EXCHANGE COMMISSION</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Washington, D.C. 20549</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"> <B>AMENDMENT NO. 4 TO</B> <BR>
<B>FORM S-1</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>REGISTRATION STATEMENT UNDER THE SECURITIES
ACT OF 1933</B></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">AETHLON MEDICAL, INC.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt">(Exact name of
registrant as specified in its charter)</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Nevada</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt">(State or other
jurisdiction of incorporation or organization)</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">3826</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt">(Primary Standard
Industrial Classification Code Number)</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">13-3632859</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt">(I.R.S. Employer
Identification Number)</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">9635 Granite Ridge Drive, Suite 100<BR>
San Diego, California 92123</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">(858) 459-7800</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt">(Address, including
zip code, and telephone number, including area code, of registrant&rsquo;s principal executive offices)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">James A. Joyce<BR>
9635 Granite Ridge Drive, Suite 100<BR>
San Diego, California 92123<BR>
(858) 459-7800</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt">(Name, address,
including zip code, and telephone number, including area code, of agent for service)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><BR>
<FONT STYLE="font-size: 10pt">With copies of all correspondence to:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 50%; text-align: center"><FONT STYLE="font-size: 10pt">Jolie Kahn, Esq.</FONT></TD>
    <TD STYLE="width: 50%; text-align: center"><FONT STYLE="font-size: 10pt">Robert Charron, Esq.</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center"><FONT STYLE="font-size: 10pt">33 Edgewood</FONT></TD>
    <TD STYLE="text-align: center"><FONT STYLE="font-size: 10pt">Ellenoff Grossman &amp; Schole LLP</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center"><FONT STYLE="font-size: 10pt">Locust Valley, NY 11560</FONT></TD>
    <TD STYLE="text-align: center"><FONT STYLE="font-size: 10pt">1345 Avenue of the Americas</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center"><FONT STYLE="font-size: 10pt">(516) 217-6379</FONT></TD>
    <TD STYLE="text-align: center"><FONT STYLE="font-size: 10pt">New York, NY 10105</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Approximate date of commencement of proposed sale to the public:
As soon as practicable after the effective date hereof.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">If any of the securities being registered
on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the
following box: [X]</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">If this Form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration
statement number of the earlier effective registration statement for the same offering. [_]</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">If this Form is a post-effective amendment
filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement
number of the earlier effective registration statement for the same offering. [_]</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-size: 10pt">If this Form
is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration statement for the same offering. [_]</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Indicate by check mark whether the registrant is a large accelerated
filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of &quot;large accelerated
filer,&quot; &quot;accelerated filer&quot; and &quot;smaller reporting company&quot; in Rule 12b-2 of the Exchange Act.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 49%"><FONT STYLE="font-size: 10pt">Large accelerated filer [_]</FONT></TD>
    <TD STYLE="width: 51%"><FONT STYLE="font-size: 10pt">Accelerated filer [_]</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD><FONT STYLE="font-size: 10pt">Non-accelerated filer [_]</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">Smaller reporting company [X] </FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD><FONT STYLE="font-size: 10pt">(Do not check if a smaller reporting company)</FONT></TD>
    <TD>&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">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).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 3%"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">[_]</FONT></TD>
    <TD STYLE="width: 97%"><FONT STYLE="font-size: 10pt">Emerging growth company</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">[_]</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">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.</FONT></TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; background-color: white">CALCULATION OF REGISTRATION
FEE</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; background-color: white">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: center"><FONT STYLE="font-size: 10pt"><B>Title of each Class of Securities</B></FONT><BR>
    <FONT STYLE="font-size: 10pt"><B>to be Registered</B></FONT></TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: black 1.5pt solid; text-align: center"><FONT STYLE="font-size: 10pt"><B>Proposed Maximum</B></FONT><BR>
    <FONT STYLE="font-size: 10pt"><B>Aggregate Offering</B></FONT><BR>
    <FONT STYLE="font-size: 10pt"><B>Price <SUP>(1)(2)</SUP></B></FONT></TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: black 1.5pt solid; text-align: center"><FONT STYLE="font-size: 10pt"><B>Amount of</B></FONT><BR>
    <FONT STYLE="font-size: 10pt"><B>Registration Fee</B></FONT></TD>
    <TD NOWRAP>&nbsp;</TD></TR>
<TR STYLE="background-color: rgb(238,238,238)">
    <TD STYLE="vertical-align: top; width: 1%">&nbsp;</TD>
    <TD STYLE="vertical-align: top; width: 64%; padding-left: 5pt; text-indent: -5pt"><FONT STYLE="font-size: 10pt">Units, each
    Unit consisting of one share of Common Stock, par value $0.001 per share and one common warrant to purchase one share of Common
    Stock (3)</FONT></TD>
    <TD STYLE="vertical-align: bottom; width: 1%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 2%"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="vertical-align: bottom; width: 15%; text-align: right"><FONT STYLE="font-size: 10pt">7,500,000</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom; width: 1%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 1%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 1%"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="vertical-align: bottom; width: 13%; text-align: right"><FONT STYLE="font-size: 10pt">869.25</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom; width: 1%">&nbsp;</TD></TR>
<TR STYLE="background-color: White">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top; text-indent: 0.25in"><FONT STYLE="font-size: 10pt">(i)&nbsp;&nbsp;&nbsp;Common Stock included
    in the Units (4)</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&ndash;</TD>
    <TD NOWRAP STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">&ndash;</TD>
    <TD NOWRAP STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="background-color: rgb(238,238,238)">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top; text-indent: 0.25in"><FONT STYLE="font-size: 10pt">(ii)&nbsp;&nbsp;Common warrants included
    in the Units (4)</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&ndash;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&ndash;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD>
    <TD STYLE="vertical-align: top; padding-left: 5pt; text-indent: -5pt"><FONT STYLE="font-size: 10pt">Pre-funded Units, each
    Pre-funded Unit consisting of one pre-funded warrant to purchase one share of Common Stock and one common warrant to purchase
    one share of Common Stock (3)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">7,500,000</FONT></TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">869.25</FONT></TD>
    <TD NOWRAP>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-size: 10pt">(i) Pre-funded warrants included in the Pre-funded Units (4)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&ndash;</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&ndash;</FONT></TD>
    <TD NOWRAP>&nbsp;</TD></TR>
<TR STYLE="background-color: White">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt">(ii) Common warrants included in the Pre-funded Units (4)</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&ndash;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 10pt">&ndash;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD>
    <TD STYLE="vertical-align: top; padding-left: 5pt; text-indent: -5pt"><FONT STYLE="font-size: 10pt">Shares of Common Stock
    underlying pre-funded warrants included in the Pre-funded Units (3)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&ndash;</FONT></TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="text-align: right">&ndash;</TD>
    <TD NOWRAP>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD>
    <TD STYLE="vertical-align: top; padding-left: 5pt; text-indent: -5pt"><FONT STYLE="font-size: 10pt">Shares of Common Stock
    underlying common warrants included in the Units and the Pre-funded Units (3)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="text-align: right">15,000,000</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="text-align: right">1,738.50</TD>
    <TD NOWRAP>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-size: 10pt">Placement Agent&rsquo;s warrants (6)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&ndash;</FONT></TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right">&ndash;</TD>
    <TD NOWRAP>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">Common Stock issuable upon exercise of Placement Agent&rsquo;s warrants (5)(6)</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">$</TD>
    <TD STYLE="text-align: right; border-bottom: Black 1pt solid">281,250</TD>
    <TD NOWRAP STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">$</TD>
    <TD STYLE="text-align: right; border-bottom: Black 1pt solid">32.60</TD>
    <TD NOWRAP STYLE="border-bottom: Black 1pt solid">&nbsp;</TD></TR>
<TR STYLE="background-color: rgb(238,238,238)">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total</FONT></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 2.25pt double; text-align: right">30,281,250</TD>
    <TD NOWRAP STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 2.25pt double"><FONT STYLE="font-size: 10pt">$</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 2.25pt double; text-align: right">3,509.60</TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 10pt"><SUP>(7) </SUP>&nbsp;</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; background-color: white"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0in"><FONT STYLE="font-size: 10pt">(1)<FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;
</FONT>Estimated pursuant to Rule 457(o) of the Securities Act of 1933 solely for purposes of calculating the amount of the registration
fee.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0in">(2)<FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;
</FONT>Pursuant to Rule 416 of the Securities Act of 1933, this Registration Statement also shall cover any additional shares
of common stock that shall become issuable by reason of any stock dividend, stock split, recapitalization, or other similar transaction
by the registrant.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0in">(3)<FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;
</FONT> <FONT STYLE="background-color: white">The proposed maximum aggregate offering price of the Units proposed to be sold in
the offering will be reduced on a dollar-for-dollar basis based on the offering price of any Pre-funded Units offered and sold
in the offering, and as such the proposed maximum aggregate offering price of the Units and Pre-funded Units (including the common
stock issuable upon exercise of the pre-funded warrants included in the Pre-funded Units), if any, is $7,500,000.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0in"><FONT STYLE="background-color: white">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0in">(4)<FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;
</FONT>No additional registration fee is payable pursuant to Rule 457(i) under the Securities Act of 1933, as amended.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0in">(5) <FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;
</FONT>No additional registration fee is payable pursuant to Rule 457(g) under the Securities Act of 1933, as amended.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="background-color: white">(6) Represents warrants to
purchase a number of shares of common stock equal to 3% of the number of shares of common stock (i) included within the Units
and (ii) issuable upon the exercise of the pre-funded warrants included within the Pre-funded Units placed in this offering at
an exercise price equal to 125% of the offering price per unit (excluding any shares of common stock underlying the common warrants
included in the units and the pre-funded units placed in this offering).</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="background-color: white">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="background-color: white">(7) The
Registrant previously paid $1,506.70 as a registration fee in connection with this registration statement filed on July 31,
2017, $108.66 was paid with the S-1A file September 26, 2017 and $1,894.24 with paid with Form S-1 filed on September 15,
2017 (and subsequently withdrawn).</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="background-color: white">&nbsp;</FONT></P>

<P STYLE="margin: 0"><B>The registrant hereby amends this registration statement on such date or dates as may be necessary to
delay its effective date until the registrant shall file a further amendment which specifically states that this registration
statement shall thereafter become effective in accordance with section 8(a) of the Securities Act of 1933 or until the registration
statement shall become effective on such date as the Commission acting pursuant to said section 8(a), may determine.</B></P>



<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="margin: 0"></P>

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<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; color: red"><B>The information in this preliminary prospectus is
not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and
Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and we are not soliciting
an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; color: red"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; color: red"><B>PRELIMINARY PROSPECTUS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; color: red"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; color: red"> <B>Subject to completion, dated
September 29, 2017</B> <B> </B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; color: red"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Aethlon Medical, Inc.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; background-color: white"><FONT STYLE="font-size: 9pt"><B>Up
to 4,777,070 Units (each Unit contains 1 Share of Common Stock and 1 Common Warrant to purchase 1 Share of Common Stock)</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; background-color: white"><FONT STYLE="font-size: 9pt"><B>or</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; background-color: white"><FONT STYLE="font-size: 9pt"><B>Up
to 4,777,070 Pre-funded Units (each Pre-funded Unit contains 1 Pre-funded Warrant to Purchase 1 Share of Common Stock and 1 Common
Warrant to Purchase</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; background-color: white"><FONT STYLE="font-size: 9pt"><B>1
Share of Common Stock</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; background-color: white"><FONT STYLE="font-size: 9pt"><B>(4,777,070
Shares of Common Stock Underlying the Pre-funded Warrants) and</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; background-color: white"><FONT STYLE="font-size: 9pt"><B>(4,777,070
Shares of Common Stock Underlying the Common Warrants)</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; background-color: white"><FONT STYLE="font-size: 9pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; background-color: white"><FONT STYLE="font-size: 9pt">___________________</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; background-color: white"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 6pt; background-color: white"><FONT STYLE="font-size: 9pt">We
are offering up to 4,777,070 units (each unit consisting of one share of our common stock and one common warrant to purchase one
share of our common stock). Each common warrant contained in a unit has an exercise price of $ &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
per share. The common warrants contained in the units will be exercisable immediately and will expire five years from the date
of issuance. We are also offering the shares of our common stock that are issuable from time to time upon exercise of the common
warrants contained in the units.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 6pt; background-color: white"><FONT STYLE="font-size: 9pt">We
are also offering to each purchaser whose purchase of units in this offering would otherwise result in the purchaser, together
with its affiliates and certain related parties, beneficially owning more than 4.99% of our outstanding common stock immediately
following the consummation of this offering, the opportunity to purchase, if the purchaser so chooses, pre-funded units (each
pre-funded unit consisting of one pre-funded warrant to purchase one share of our common stock and one common warrant to purchase
one share of our common stock) in lieu of units that would otherwise result in the purchaser&rsquo;s beneficial ownership exceeding
4.99% of our outstanding common stock (or at the election of the purchaser, 9.99%). The purchase price of each pre-funded unit
will equal the price per unit being sold to the public in this offering minus $0.01, and the exercise price of each pre-funded
warrant included in the pre-funded unit will be $0.01 per share. This offering also relates to the shares of common stock issuable
upon exercise of any pre-funded warrants contained in the pre-funded units sold in this offering. Each common warrant contained
in a pre-funded unit has an exercise price of $ &nbsp;&nbsp;&nbsp; per share. The common warrants contained in the pre-funded
units will be exercisable immediately and will expire five years from the date of issuance. We are also offering the shares of
our common stock that are issuable from time to time upon exercise of the common warrants contained in the pre-funded units. For
each pre-funded unit we sell, the number of units we are offering will be decreased on a one-for-one basis. Units and the pre-funded
units will not be issued or certificated. The shares of common stock or pre-funded warrants, as the case may be, and the common
warrants can only be purchased together in this offering but the securities contained in the units or pre-funded units will be
issued separately.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 6pt"><FONT STYLE="font-size: 9pt">Our common stock is listed on
the NASDAQ Capital Market under the symbol &ldquo;AEMD.&rdquo; On September 7, 2017, the closing bid price of our common stock
as reported on the NASDAQ Capital market was $1.57 per share. The public offering price per share and related warrant will be
determined between us, the placement agent and the investors in the offering based on market conditions at the time of pricing,
and may be at a discount to the current market price of our common stock. There is no established trading market for the warrants,
and we do not expect an active trading market to develop. We do not intend to list the warrants on any securities exchange or
other trading market. Without a trading market, the liquidity of the warrants will be extremely limited. </FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 6pt"><FONT STYLE="font-size: 9pt"><B>Investing in our securities
involves risks. You should carefully read and consider the &ldquo;Risk Factors&rdquo; beginning on page 5 of this prospectus before
investing.</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="font-weight: bold; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 9pt"><B>Per
                                         Unit </B></FONT></TD><TD STYLE="font-weight: bold; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold; padding-bottom: 1pt"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="font-weight: bold; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 9pt"><B>Per
                                         Pre-Funded Unit</B></FONT></TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: center; border-bottom: Black 1pt solid"><B>Total</B></TD><TD STYLE="font-weight: bold; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 56%; font-weight: bold"><FONT STYLE="font-size: 9pt">Public offering price</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 9pt"><B>$</B></FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font-size: 9pt">&#9679;</FONT></TD><TD STYLE="width: 2%; text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 2%; text-align: left"><FONT STYLE="font-size: 9pt"><B>$</B></FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font-size: 9pt">&#9679;</FONT></TD>
    <TD STYLE="width: 3%">&nbsp;</TD>
    <TD STYLE="width: 11%; text-align: right">&nbsp; <FONT STYLE="font-size: 9pt">&#9679;</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left"><FONT STYLE="font-size: 9pt">Placement agent fees</FONT></TD><TD><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt"><B>$</B></FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 9pt">&#9679;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt"><B>$</B></FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 9pt">&#9679;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp; <FONT STYLE="font-size: 9pt">&#9679;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="font-weight: bold; text-align: left"><FONT STYLE="font-size: 9pt">Proceeds, before expenses, to us</FONT></TD><TD><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt"><B>$</B></FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 9pt">&#9679;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt"><B>$</B></FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 9pt">&#9679;</FONT></TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;<FONT STYLE="font-size: 9pt">&#9679;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 6pt"><FONT STYLE="font-size: 9pt">We have retained H.C. Wainwright
&amp; Co., LLC as our exclusive placement agent to use its reasonable best efforts to solicit offers to purchase the securities
in this offering. The placement agent has no obligation to buy any of the securities from us or to arrange for the purchase or
sale of any specific number or dollar amount of the securities. The placement agent is not required to sell any specific number
or dollar amount of securities being offered hereby but will use its best efforts to sell the securities offered. Because there
is no minimum offering amount required as a condition to closing in this offering, the actual public offering amount, placement
agent's fees, and proceeds to us, if any, are not presently determinable and may be substantially less than the total maximum
offering amounts set forth above.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 6pt"><FONT STYLE="font-size: 9pt">We have agreed to pay the placement
agent a total cash fee equal to 6.0% of the gross proceeds of this offering and a management fee of 1% of the gross proceeds of
this offering. In addition to the placement agent&rsquo;s fees, we have agreed to pay the placement agent a non-accountable expense
allowance of $50,000, to reimburse the placement agent for fees and expenses of its legal counsel in an amount up to $100,000
and to reimburse the placement agent for any escrow or settlement fees in an amount not to exceed $10,000. As additional compensation,
we plan to issue the placement agent warrants to purchase a number of shares of common stock equal to 3% of (i) the number of
shares of common stock placed in this offering, and (ii) issuable upon exercise of the pre-funded warrants. The exercise price
for these warrants will be $ per share, which represents 125% of the public offering price per unit. See &ldquo;Plan of Distribution.&rdquo;
</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 6pt"><FONT STYLE="font-size: 9pt"><B>Neither the Securities and
Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy
or accuracy of this prospectus. Any representation to the contrary is a criminal offense.</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 6pt"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 6pt"><FONT STYLE="font-size: 9pt">Delivery of the shares of our
common stock and warrants is expected to be made on or about &#9679;, 2017. </FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>H.C. Wainwright &amp; Co.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; text-align: center; margin-bottom: 0">The date of this prospectus
is&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; text-align: center; margin-bottom: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; text-align: center; margin-bottom: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; text-align: center; margin-bottom: 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; text-align: left; margin-bottom: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; text-align: left; margin-bottom: 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0.45pt 0 0; text-align: center"><B>AETHLON MEDICAL, INC.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><A NAME="a1"></A><B>TABLE OF CONTENTS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>&nbsp;</B></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: right; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Page</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 83%; text-align: left"><A HREF="#a2">About this Prospectus</A></TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 13%; text-align: right">1</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><A HREF="#a50">Prospectus Summary</A></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left"><A HREF="#a3">The Offering</A></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><A HREF="#a51">Risk Factors</A></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left"><A HREF="#a4">Special Note Regarding Forward-Looking Statements</A></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">26</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><A HREF="#a5">Use of Proceeds</A></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">27</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left"><A HREF="#a6">Market Price for Common Equity and Related Stockholder Matters</A></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">28</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><A HREF="#a8">Capitalization</A></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">32</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left"><A HREF="#a9">Dividend Policy</A></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">33</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><A HREF="#a10">Dilution</A></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">33</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left"><A HREF="#a11">Management&rsquo;s Discussion and Analysis of Financial Condition and Results
    of Operations</A></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">35</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><A HREF="#a12">Business</A></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">49</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left"><A HREF="#a52">Directors and Executive Officers</A></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">62</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><A HREF="#a53">Executive Compensation</A></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">65</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left"><A HREF="#a54">Security Ownership of Certain Beneficial Owners and Management</A></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">70</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><A HREF="#a55">Certain Relationships and Related Transactions and Director Independence</A></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">72</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left"><A HREF="#a56">Description of Capital Stock</A></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">73</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><A HREF="#a57">Description of Securities We Are Offering</A></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">73</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD><A HREF="#a58">Plan of Distribution</A></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">76</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><A HREF="#a59">Legal Matters</A></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">78</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD><A HREF="#a60">Experts</A></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">78</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><A HREF="#a61">Where You Can Find More Information</A></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">78</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left"><A HREF="#a25">Index to Consolidated Financial Statements</A></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">F-1</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><A NAME="a2"></A><B>ABOUT THIS PROSPECTUS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B>You should rely only on the information
contained in this prospectus. We have not authorized any person to provide you with different information. If anyone provides
you with different or inconsistent information, you should not rely on it. We are not making an offer to sell these securities
in any jurisdiction where the offer or sale is not permitted. The information contained in this prospectus is accurate only as
of the date of this document, regardless of the time of delivery of this prospectus or the time of issuance or sale of any securities.
Our business, financial condition, results of operations and prospects may have changed since that date. You should read this
prospectus in its entirety before making an investment decision. You should also read and consider the information in the documents
to which we have referred you in the section of this prospectus entitled &ldquo;Where You Can Find More Information.&rdquo;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B>For investors outside of the United
States, neither we nor the placement agent have done anything that would permit this offering or possession or distribution of
this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. You are required
to inform yourselves about and to observe any restrictions relating to this offering and the distribution of this prospectus outside
of the United States.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><A NAME="a50"></A><B>PROSPECTUS
SUMMARY</B></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><I>This summary highlights certain information
about us, this offering and selected information contained elsewhere in this prospectus. This summary is not complete and does
not contain all of the information that you should consider before deciding whether to invest in our securities. You should carefully
read the entire prospectus, including the information set forth in the section entitled &ldquo;Risk Factors.&rdquo;</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Company Overview</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We are a medical technology company focused
on addressing unmet needs in global health and biodefense. The Aethlon Hemopurifier&reg; is an early clinical-stage therapeutic
device designed for the single-use removal of life-threatening viruses from the circulatory system of infected individuals. We
believe the Hemopurifier&reg; can be a part of the broad-spectrum treatment of life-threatening highly glycosylated viruses that
are not addressed with an already approved treatment countermeasure objectives set forth by the U.S. Government to protect citizens
from bioterror and pandemic threats. In small-scale or early feasibility human studies, the Hemopurifier&reg; has been administered
to HIV, Hepatitis-C, and Ebola infected individuals. Additionally, the Hemopurifier&reg; has also been validated to capture Zika
virus, Lassa virus, MERS-CoV, Cytomegalovirus, Epstein-Barr virus, Herpes Simplex virus, Chikungunya virus, Dengue virus, West
Nile virus, Smallpox-related viruses, H1N1 Swine Flu virus, H5N1 Bird Flu virus, and the reconstructed Spanish flu virus of 1918.
In several cases, these validations were conducted in collaboration with leading government or non-government research institutes.
In the United States, we are focused on the clinical advancement of the Hemopurifier&reg; through investigational device exemptions
(IDEs) approved by FDA. We recently concluded a feasibility study to demonstrate the safety of our device in health-compromised
individuals infected with a viral pathogen. We are also the majority owner of Exosome Sciences, Inc. (ESI), a company focused
on the discovery of exosomal biomarkers to diagnose and monitor life-threatening diseases. Included among ESI&rsquo;s endeavors
is the advancement of a TauSomeTM biomarker candidate to diagnose Chronic Traumatic Encephalopathy (CTE) in the living. ESI previously
documented that TauSome levels in former NFL players to be 9x higher than same age-group control subjects.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Corporate History</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On March 10, 1999, Aethlon, Inc., a California
corporation, Hemex, Inc., a Delaware corporation and the accounting predecessor to Aethlon, Inc., and Bishop, Inc., a publicly-traded
company, completed an Agreement and Plan of Reorganization structured to result in Bishop, Inc.'s acquisition of all of the outstanding
common shares of Aethlon, Inc. and Hemex, Inc. Under the plan's terms, Bishop, Inc. issued shares of its common stock to the stockholders
of Aethlon, Inc. and Hemex, Inc. such that Bishop, Inc. then owned 100% of each company. Upon completion of the transaction, Bishop,
Inc. was renamed Aethlon Medical, Inc. Our executive offices are located at 9635 Granite Ridge Drive, Suite 100, San Diego, California
92123. Our telephone number is (858) 459-7800. Our website address is <FONT STYLE="color: blue">www.aethlonmedical.com</FONT>.
Our website and the information contained on our website are not incorporated into this prospectus or the registration statement
of which it forms a part.</P>

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</DIV>



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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Our Lead Device: The Aethlon Hemopurifier</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The Aethlon Hemopurifier is a device that
selectively targets the rapid elimination of circulating viruses and tumor-secreted exosomes that may promote cancer progression.
More specifically, the Hemopurifier has the potential to address antiviral drug-resistance in Hepatitis C virus and Human Immunodeficiency
Virus-infected individuals; serve as a potential countermeasure against viral pathogens not addressed by drug or vaccine therapies;
and, we believe, represent the first therapeutic strategy to potentially address cancer-promoting exosomes. In clinical studies
conducted in India, safety and efficacy observations of Hemopurifier therapy have been observed in both Hepatitis C virus and
Human Immunodeficiency Virus-infected individuals. We have recently completed the treatment of eight patients in our first FDA-approved
early feasibility study of Hemopurifier therapy in the U.S., and are preparing our final report on that study for submission to
the FDA.</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>The Scientific Mechanism of the Hemopurifier</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The Hemopurifier is an extracorporeal device
designed for the single-use removal of viruses, viral toxins, and deleterious exosomes from the circulatory system of treated
patients. Delivery of Hemopurifier therapy can occur through the established infrastructure of continuous renal replacement therapy
and dialysis instruments routinely found in hospitals and clinics worldwide. Many extracorporeal techniques, such as dialysis
or plasmapheresis, are designed to remove circulating particles solely by molecule size. However, the Hemopurifier incorporates
a lectin-affinity agent that is designed to bind to a unique high mannose signature that is abundant on the surface of tumor-derived
exosomes and glycoproteins that reside on the outer membrane of infectious viruses. The Hemopurifier is designed to provide a
broad-spectrum treatment of life-threatening highly glycosylated viruses that are not addressed with an already approved treatment
mechanism to remove certain cancer and infectious disease-related particles from human blood. A single treatment with the Hemopurifier
can last from three to six and one half hours in duration.</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>The Hemopurifier - U.S. Clinical Trials</B></P>

<P STYLE="margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On March 13, 2017, we disclosed that we
concluded an FDA-approved feasibility study of Hemopurifier therapy, which demonstrated safety of our device in health-compromised
individuals infected with a viral pathogen as a model to suggest the potential of our device as studied for the broad-spectrum
treatment of life-threatening highly glycosylated viruses that are not addressed with an already approved treatment countermeasure
against infectious viral pathogens, where a reduction in viral load would be deemed beneficial to improve patient mortality or
another clinically-beneficial endpoint. More specifically, the feasibility study was conducted on Hepatitis C virus (HCV)-infected
dialysis patients at DaVita MedCenter Dialysis in Houston, Texas. The principal investigator of the study was Dr. Ronald Ralph.
We reported that there were no device-related adverse events in the eight enrolled subjects who met the study inclusion-exclusion
criteria. We also reported that an average capture of 154 million HCV viruses (in International Units, I.U.) within the Hemopurifier&reg;
during 4-hour treatments.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On August 11, 2017, we submitted an Expedited
Access Pathway (EAP) program submission to the FDA, which included a request for a &ldquo;Breakthrough Technology&rdquo; designation,
which was established under the 21<SUP>st</SUP> Century Cures Act signed into law in 2016. The proposed indications for use includes
&quot;The Hemopurifier is a single-use device indicated for the treatment of life-threatening highly glycosylated viruses that
are not addressed with an approved treatment,&quot; and on September 8, 2017, we received a letter from the FDA informing us that
our product and proposed indication for use meets the criteria and has been granted EAP designation. Through this program, we
will work collaboratively with FDA to design a data development plan and regulatory pathway intended to achieve FDA-approval of
the device, and through this process, we believe the regulatory advancement of our device with the FDA will be accelerated.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Additionally, we are advancing the Hemopurifier&reg;
for the broad-spectrum treatment of life-threatening highly glycosylated viruses that are not addressed with an already approved
treatment to fulfill the treatment objectives of the 2016 Public Health Emergency Medical Countermeasure Enterprise (PHEMCE),
which defines the plan of the U.S. government to protect citizens against bioterror and pandemic threats. Based on preclinical
and early-phase or feasibility clinical studies, we believe the Hemopurifier&reg; is a potential broad-spectrum treatment against
life-threatening highly glycosylated viruses that are not addressed with an already approved treatment countermeasure. Our goal
would be for our device to be procured by the U.S. government for the strategic national stockpile. Currently, we have not begun
discussions for inclusion in the strategic national stockpile.</P>



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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Exosome Sciences, Inc. - Diagnostic Candidates</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Through our majority-owned subsidiary Exosome,
which is our diagnostic product-oriented business segment, we are developing exosome-based product candidates to diagnose and
monitor neurological disorders and cancer. Since it began operations in 2013, Exosome researchers have disclosed that they have
isolated brain-specific biomarkers potentially associated with Alzheimer's Disease and Chronic Traumatic Encephalopathy (CTE).
Specific to CTE, Exosome is participating in a research collaboration with The Boston University CTE Center to study the correlation
of a biomarker known as tausome with CTE.</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><A NAME="a3"></A><B>THE
OFFERING</B></P>

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<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; background-color: white">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 47%; font-size: 10pt"><FONT STYLE="font-size: 10pt">Units offered by us in this offering:</FONT></TD>
    <TD STYLE="width: 53%; font-size: 10pt"><FONT STYLE="font-size: 10pt">4,777,070 units, each consisting of one share of our
    common stock and one common warrant to purchase one share of our common stock</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt"><FONT STYLE="font-size: 10pt">Pre-funded units offered by us in this offering:</FONT></TD>
    <TD STYLE="font-size: 10pt"><FONT STYLE="font-size: 10pt">We are also offering to each purchaser whose purchase of units in
    this offering would otherwise result in the purchaser, together with its affiliates and certain related parties, beneficially
    owning more than 4.99% of our outstanding common stock immediately following the consummation of this offering, the opportunity
    to purchase, if the purchaser so chooses, pre-funded units (each pre-funded unit consisting of one pre-funded warrant to purchase
    one share of our common stock and one common warrant to purchase one share of our common stock) in lieu of units that would
    otherwise result in the purchaser&rsquo;s beneficial ownership exceeding 4.99% of our outstanding common stock (or, at the
    election of the purchaser, 9.99%). The purchase price of each pre-funded unit will equal the price at which the units are
    being sold to the public in this offering, minus $0.01, and the exercise price of each pre-funded warrant included in each
    pre-funded unit will be $0.01 per share. This offering also relates to the shares of common stock issuable upon exercise of
    any pre-funded warrants sold in this offering. For each pre-funded unit we sell, the number of units we are offering will
    be decreased on a one-for-one basis. Because we will issue a common warrant as part of each unit or pre-funded unit, the number
    of common warrants sold in this offering will not change as a result of a change in the mix of the units and pre-funded units
    sold.</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt"><FONT STYLE="font-size: 10pt">Common warrants offered by us in the offering</FONT></TD>
    <TD STYLE="font-size: 10pt"><FONT STYLE="font-size: 10pt">Common warrants to purchase an aggregate of 4,777,070 shares of
    our common stock. Each unit and each pre-funded unit includes a common warrant to purchase one share of our common stock.
    Each common warrant will have an exercise price of $&nbsp; &nbsp;&nbsp; per share, will be immediately separable from the
    common stock or pre-funded warrant, as the case may be, will be immediately exercisable and will expire on the fifth anniversary
    of the original issuance date. This prospectus also relates to the offering of the shares of common stock issuable upon exercise
    of the common warrants.</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD><B>Common stock outstanding prior to the offering (1)</B></TD>
    <TD>8,951,081 shares on September 7, 2017</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt"><FONT STYLE="font-size: 10pt"><B>Common stock outstanding after the offering (1)</B></FONT></TD>
    <TD STYLE="font-size: 10pt"><FONT STYLE="font-size: 10pt">13,728,151 shares, or 18,498,241 shares if the warrants sold in
    this offering are exercised in full (assuming a combined public offering price of $1.57 per share of our common stock and
    related warrant, the closing bid price of our common stock on NASDAQ on September 7, 2017)</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt"><FONT STYLE="font-size: 10pt"><B>Use of proceeds</B></FONT></TD>
    <TD STYLE="font-size: 10pt"><FONT STYLE="font-size: 10pt">We intend to use the net proceeds of this offering to continue clinical
    development of our product candidates and for working capital and other general corporate purposes. See &ldquo;Use of Proceeds&rdquo;
    on page 27 of this prospectus.</FONT></TD></TR>
</TABLE>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<DIV STYLE="margin: 0.1in; padding: 0.1in; border: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; background-color: white">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 47%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 53%; font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt"><FONT STYLE="font-size: 10pt"><B>Risk factors</B></FONT></TD>
    <TD>You should read the &ldquo;Risk Factors&rdquo; section of this prospectus for a discussion of factors to consider carefully
    before deciding to invest in shares of our common stock.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt"><FONT STYLE="font-size: 10pt"><B>Market symbol and trading</B></FONT></TD>
    <TD>Our common stock is listed on the NASDAQ Capital Market under the symbol &ldquo;AEMD.&rdquo; There is no established trading
    market for the warrants, and we do not expect a trading market to develop. We do not intend to list the warrants on any securities
    exchange or other trading market. Without a trading market, the liquidity of the warrants will be extremely limited. We do
    not plan on applying to list the pre-funded warrants or the common warrants on NASDAQ, any national securities exchange or
    any other nationally recognized trading system. Without an active trading market, the liquidity of the pre-funded warrants
    or common warrants will be limited.</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 0.25in">(1)</TD><TD>The number of shares of our common stock outstanding prior
                                         to and to be outstanding immediately after this offering, as set forth in the above table,
                                         is based on 8,951,081 shares of our common stock outstanding as of September 7, 2017
                                         and excludes as of that date:</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>466,547
                                         shares of common stock issuable upon exercise of outstanding stock options under our
                                         stock incentive plans at a weighted average exercise price of $10.30 per share;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>2,464,739
                                         additional shares of common stock reserved for issuance under outstanding warrants with
                                         a weighted average exercise price of $3.48 per share;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>507,375
                                         additional shares of common stock reserved for future issuance under our stock incentive
                                         plans;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">451,786
                                         additional shares of common stock issuable under convertible notes, which includes accrued
                                         interest through September 7, 2017;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">shares
                                         of common stock issuable upon exercise of the warrants offered hereby; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">shares
                                         of common stock issuable upon exercise of warrants to be issued to the placement agent
                                         in connection with this offering.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

</DIV>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: center; margin-bottom: 0pt"><A NAME="a51"></A><B>RISK
FACTORS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><I>An investment in our securities involves
a high degree of risk. You should carefully consider the risks described below as well as the other information in this prospectus
before deciding to invest in or maintain your investment in our company. The risks described below are not intended to be an all-inclusive
list of all of the potential risks relating to an investment in our securities. Any of the risk factors described below could
significantly and adversely affect our business, prospects, financial condition and results of operations. Additional risks and
uncertainties not currently known or that are currently considered to be immaterial may also materially and adversely affect our
business. As a result, the trading price or value of our securities could be materially adversely affected and you may lose all
or part of your investment.</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Risks Relating to Our Financial Position and Need for Additional
Capital</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>We will require additional financing beyond this current
offering to sustain our operations, and without it, we will not be able to continue operations.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We raised $2,759,355 in net proceeds from
sales of common stock and $577,460 in net proceeds from convertible notes under our S-3 registration statement during the fiscal
year ended March 31, 2017. From April 1, 2017 through September 12, 2017, we entered into sales under our ATM facility of 601,504
shares of common stock for aggregate net proceeds to us of $1,650,314. However, we will require significant additional financing
to conduct the expected additional future clinical trials in the U.S., as well as fund all of our continued research and development
activities for the Hemopurifier and other future products through the remainder of the fiscal year ending March 31, 2018 and beyond.
In addition, as we expand our activities, our overhead costs to support personnel, laboratory materials and infrastructure will
increase. Should the financing we require to sustain our working capital needs be unavailable to us on reasonable terms, if at
all, when we require it, we may be unable to support our research and product development activities including our potential clinical
trials. The failure to implement our research and product development activities would have a material adverse effect on our ability
to commercialize our products and continue in existence. We will need to raise additional funds through debt and/or equity financings
in order to complete our ultimate business objectives, including funding working capital to support development and regulatory
clearance of our products. We also may choose to raise additional funds in debt or equity financings if they are available to
us on reasonable terms to increase our working capital and to strengthen our financial position. Any sales of additional equity
or convertible debt securities would result in dilution of the equity interests of our existing stockholders, which could be substantial.
Also, new investors may require that we and certain of our stockholders enter into voting arrangements that give them additional
voting control or representation on our Board of Directors.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>We have incurred significant losses and expect to continue
to incur losses for the foreseeable future.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have never been profitable. We have
generated revenues during the fiscal years ended March 31, 2017 and March 31, 2016, in the amounts of $392,073, and $886,572,
respectively, primarily from our contract with the Defense Advanced Research Projects Agency, or DARPA, which will not continue
into fiscal 2018. However, our revenues have been insufficient to cover our cost of operations. Additionally, our contracts with
DARPA have now ended, and we have no assurance when, if at all, we will be able to enter into future government contracts. Future
profitability, if any, will require the successful commercialization of our Hemopurifier technology, other products that may emerge
from our potential diagnostic products or from additional government contract or grant income. We cannot assure you when or if
we will be able to successfully commercialize one or more of our products, or if commercialization is successful, whether we will
ever be profitable.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>We have received an explanatory paragraph from our auditors
regarding our ability to continue as a going concern.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our independent registered public accounting
firm noted in their report accompanying our financial statements for our fiscal year ended March 31, 2017 that our net loss and
negative cash flows from operating activities during our fiscal year ended March 31, 2017 and our accumulated deficit as of March
31, 2017 raised substantial doubt about our ability to continue as a going concern. Note 1 to our financial statements for the
year ended March 31, 2017 describes management's plans to address these matters. We cannot assure you that our business plans
will be successful in addressing these issues. This explanatory paragraph about our ability to continue as a going concern could
affect our ability to obtain additional financing at favorable terms, if at all, as it may cause investors to lose faith in our
long-term prospects. If we cannot successfully continue as a going concern, our shareholders may lose their entire investment.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Risks Related to Our Business Operations</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>We face intense competition in the medical device industry</I></B>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We compete with numerous U.S. and foreign
companies in the medical device industry, and many of our competitors have greater financial, personnel, operational and research
and development resources than we do. Our competitors are developing vaccine candidates and/or antiviral drugs, which could compete
with the Hemopurifier medical device candidates we are developing. Our commercial opportunities will be reduced or eliminated
if our competitors develop and market products for any of the diseases we target that:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt"><FONT STYLE="font-family: Times New Roman, Times, Serif">are more effective;</FONT></TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">have fewer or less severe adverse side effects;</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt"><FONT STYLE="font-family: Times New Roman, Times, Serif">are better tolerated;</FONT></TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">are more adaptable to various modes of dosing;</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in"></P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">are easier to administer; or</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">are less expensive than the products or product candidates we are developing.</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Even if we are successful in developing
the Hemopurifier and potential diagnostic products, and obtain FDA and other regulatory approvals necessary for commercializing
them, our products may not compete effectively with other successful products. Researchers are continually learning more about
diseases, which may lead to new technologies for treatment. Our competitors may succeed in developing and marketing products that
are either more effective than those that we may develop, alone or with our collaborators, or that are marketed before any products
we develop are marketed. Our competitors include fully integrated pharmaceutical companies and biotechnology companies as well
as universities and public and private research institutions. Many of the organizations competing with us have substantially greater
capital resources, larger research and development staffs and facilities, greater experience in product development and in obtaining
regulatory approvals, and greater marketing capabilities than we do. If our competitors develop more effective pharmaceutical
treatments for infectious disease or cancer, or bring those treatments to market before we can commercialize the Hemopurifier
for such uses, we may be unable to obtain any market traction for our products, or the diseases we seek to treat may be substantially
addressed by competing treatments. If we are unable to successfully compete against larger companies in the pharmaceutical industry,
we may never generate significant revenue or be profitable.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>We have limited experience in identifying and working
with large-scale contracts with medical device manufacturers; manufacture of our devices must comply with good manufacturing practices
in the U.S.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">To achieve the levels of production necessary
to commercialize our Hemopurifier and other future products, we will need to secure large-scale manufacturing agreements with
contract manufacturers which comply with good manufacturing practice standards and other standards prescribed by various federal,
state and local regulatory agencies in the U.S. and any other country of use. We have no experience coordinating and overseeing
the manufacture of medical device products on a large-scale. We cannot assure you that manufacturing and control problems will
not arise as we attempt to commercialize our products, if they are ever approved for use or that such manufacturing can be completed
in a timely manner or at a commercially reasonable cost. In addition, we cannot assure you that we will be able to adequately
finance the manufacture and distribution of our products on terms acceptable to us, if at all. If we cannot successfully oversee
and finance the manufacture of our products if and when they have obtained regulatory clearances, we may never generate revenue
from product sales and we may never be profitable.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Our Aethlon Hemopurifier technology may become obsolete.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our Aethlon Hemopurifier products may be
made unmarketable by new scientific or technological developments where new treatment modalities are introduced that are more
efficacious and/or more economical than our products. The homeland security industry is growing rapidly with many competitors
that are trying to develop products or vaccines to protect against infectious disease. Any one of our competitors could develop
a more effective product which would render our technology obsolete. Further, our ability to achieve significant and sustained
penetration of our key target markets will depend upon our success in developing or acquiring technologies developed by other
companies, either independently, through joint ventures or through acquisitions. If we fail to develop or acquire, and manufacture
and sell, products that satisfy our customers&rsquo; demands, or we fail to respond effectively to new product announcements by
our competitors by quickly introducing competitive products, then market acceptance of our products could be reduced and our business
could be adversely affected. We cannot assure you that our products will remain competitive with products based on new technologies.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Acceptance into FDA&rsquo;s EAP program may not result
in FDA-approval of the Hemopurifier</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We believe that acceptance of the Hemopurifier
by the FDA into its EAP program is a positive development towards eventual FDA-approval to bring the device to market in the U.S.
However, there is no guarantee the agency will eventually approve the Hemopurifier for marketing in the U.S. Indeed, future FDA-approval
of the Hemopurifier will be predicated upon the quality of the pre-clinical and clinical data generated for the device as well
as on any additional criteria established under the EAP program. Thus, should data developed on the Hemopurifier not be sufficient
to support FDA-approval of the device, the prospects of achieving FDA-approval could be reduced and our business could be adversely
affected.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>The clinical benefit of reducing viral load has not yet
been established.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The Aethlon Hemopurifier is being studied
for the removal of viral pathogens from the circulatory system of infected individuals. It has not yet been established, however,
whether such reduction in viral load will result in an improvement in patient mortality or other clinically-beneficial endpoints.
Thus, the full potential of the device has not yet been determined. Should future studies demonstrate that use of the Hemopurifier
to reduce viral load does not result in an improvement in patient outcome, market acceptance of the device could be reduced and
our business could be adversely affected. We cannot assure you that our products will remain competitive with products based on
new technologies.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Our use of hazardous materials, chemicals and viruses
exposes us to potential liabilities for which we may not have adequate insurance.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our research and development involves the
controlled use of hazardous materials, chemicals and viruses. The primary hazardous materials include chemicals needed to construct
the Hemopurifier cartridges and the infected plasma samples used in preclinical testing of the Hemopurifier. All other chemicals
are fully inventoried and reported to the appropriate authorities, such as the fire department, who inspect the facility on a
regular basis. We are subject to federal, state, local, and foreign laws governing the use, manufacture, storage, handling, and
disposal of such materials. Although we believe that our safety procedures for the use, manufacture, storage, handling, and disposal
of such materials comply with the standards prescribed by federal, state, local and foreign regulations, we cannot completely
eliminate the risk of accidental contamination or injury from these materials. We have had no incidents or problems involving
hazardous chemicals or biological samples. In the event of such an accident, we could be held liable for significant damages or
fines.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We currently carry a limited amount of
insurance to protect us from damages arising from hazardous materials. Our product liability policy has a $3,000,000 limit of
liability that would cover certain releases of hazardous substances away from our facilities. For our facilities, our property
policy provides $25,000 in coverage for contaminant clean-up or removal and $50,000 in coverage for damages to the premises resulting
from contamination. Should we violate any regulations concerning the handling or use of hazardous materials, or should any injuries
or death result from our use or handling of hazardous materials, we could be the subject of substantial lawsuits by governmental
agencies or individuals. We may not have adequate insurance to cover all or any of such claims, if any. If we were responsible
to pay significant damages for violations or injuries, if any, we might be forced to cease operations since such payments could
deplete all of our available resources.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our business exposes us to potential product
liability and other liability risks that are inherent in the testing, manufacturing and marketing of medical devices. We cannot
be sure that claims will not be asserted against us. A successful liability claim or series of claims brought against us could
have a material adverse effect on our business, financial condition and results of operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We cannot give assurances that we will
be able to continue to obtain or maintain adequate product liability insurance on acceptable terms, if at all, or that such insurance
will provide adequate coverage against potential liabilities. Claims or losses in excess of any product liability insurance coverage
that we may obtain could have a material adverse effect on our business, financial condition and results of operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our Hemopurifier products may be used in
connection with medical procedures in which it is important that those products function with precision and accuracy. If our products
do not function as designed, or are designed improperly, we may be forced by regulatory agencies to withdraw such products from
the market. In addition, if medical personnel or their patients suffer injury as a result of any failure of our products to function
as designed, or our products are designed inappropriately, we may be subject to lawsuits seeking significant compensatory and
punitive damages. The risk of product liability claims, product recalls and associated adverse publicity is inherent in the testing,
manufacturing, marketing and sale of medical products. We have recently obtained general clinical trial liability insurance coverage.
We cannot give assurances that our insurance coverage will to be adequate or available. We may not be able to secure product liability
insurance coverage on acceptable terms or at reasonable costs when needed. Any product recall or lawsuit seeking significant monetary
damages may have a material effect on our business and financial condition. Any liability for mandatory damages could exceed the
amount of our coverage. Moreover, a product recall could generate substantial negative publicity about our products and business
and inhibit or prevent commercialization of other future product candidates.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Our success is dependent in part on a few key executive
officers.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our success depends to a critical extent
on the continued services of our Chief Executive Officer, James A. Joyce, and our President, Rodney S. Kenley. If one or both
of these key executive officers were to leave us, we would be forced to expend significant time and money in the pursuit of a
replacement, which would result in both a delay in the implementation of our business plan and the diversion of limited working
capital. The unique knowledge and expertise of these individuals would be difficult to replace within the biotechnology field.
We can give you no assurances that we can find satisfactory replacements for these key executive officers at all, or on terms
that are not unduly expensive or burdensome to us. Although Mr. Joyce has signed an employment agreement providing for his continued
service to us, that agreement will not preclude him from leaving us should we be unable to compete with offers for employment
he may receive from other companies. We do not currently carry key man life insurance policies on any of our key executive officers
which would assist us in recouping our costs in the event of the loss of those officers. If either of our key officers were to
leave us, it could make it impossible, if not cause substantial delays and costs, to implement our long-term business objectives
and growth.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Our inability to attract and retain qualified personnel
could impede our ability to achieve our business objectives.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have six full-time employees consisting
of our Chief Executive Officer, our President, our Chief Financial Officer, two research scientists and an executive assistant.
We utilize, whenever appropriate, consultants in order to conserve cash and resources. Although we believe that these employees
and consultants will be able to handle most of our additional administrative, research and development and business development
in the near term, we will nevertheless be required over the longer-term to hire highly skilled managerial, scientific and administrative
personnel to fully implement our business plan and growth strategies, including to mitigate the material weakness in our internal
control over financial reporting described elsewhere in this prospectus. Due to the specialized scientific nature of our business,
we are highly dependent upon our ability to attract and retain qualified scientific, technical and managerial personnel. Competition
for these individuals, especially in San Diego, California, where many biotechnology companies are located, is intense and we
may not be able to attract, assimilate or retain additional highly qualified personnel in the future. We cannot assure you that
we will be able to engage the services of such qualified personnel at competitive prices or at all, particularly given the risks
of employment attributable to our limited financial resources and lack of an established track record. Also, if we are required
to attract personnel from other parts of the U.S. or abroad, we may have significant difficulty doing so due to the high cost
of living in the Southern California area and due to the costs incurred with transferring personnel to the area. If we cannot
attract and retain qualified staff and executives, we will be unable to develop our products and achieve regulatory clearance,
and our business could fail.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>





<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>We plan to grow rapidly which will strain our resources;
our inability to manage our growth could delay or derail implementation of our business objectives.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We will need to significantly expand our
operations to implement our longer-term business plan and growth strategies if any of our products receive FDA approval. We will
also be required to manage multiple relationships with various strategic partners, technology licensors, customers, manufacturers
and suppliers, consultants and other third parties. This expansion and these expanded relationships will require us to significantly
improve or replace our existing managerial, operational and financial systems, procedures and controls; to improve the coordination
between our various corporate functions; and to manage, train, motivate and maintain a growing employee base. The time and costs
to effectuate these steps may place a significant strain on our management personnel, systems and resources, particularly given
the limited amount of financial resources and skilled employees that may be available at the time. We cannot assure you that we
will institute, in a timely manner or at all, the improvements to our managerial, operational and financial systems, procedures
and controls necessary to support our anticipated increased levels of operations and to coordinate our various corporate functions,
or that we will be able to properly manage, train, motivate and retain our anticipated increased employee base. If we cannot manage
our growth initiatives, we will be unable to commercialize our products on a large-scale in a timely manner, if at all, and our
business could fail.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>As a public company with limited financial resources
undertaking the launch of new medical technologies, we may have difficulty attracting and retaining executive management and directors.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The directors and management of publicly
traded corporations are increasingly concerned with the extent of their personal exposure to lawsuits and stockholder claims,
as well as governmental and creditor claims which may be made against them, particularly in view of recent changes in securities
laws imposing additional duties, obligations and liabilities on management and directors. Due to these perceived risks, directors
and management are also becoming increasingly concerned with the availability of directors&rsquo; and officers&rsquo; liability
insurance to pay on a timely basis the costs incurred in defending such claims. While we currently carry directors&rsquo; and
officers&rsquo; liability insurance, such insurance is expensive and difficult to obtain. If we are unable to continue or provide
directors&rsquo; and officers&rsquo; liability insurance at affordable rates or at all, it may become increasingly more difficult
to attract and retain qualified outside directors to serve on our Board of Directors. We may lose potential independent board
members and management candidates to other companies in the biotechnology field that have greater directors&rsquo; and officers&rsquo;
liability insurance to insure them from liability or to biotechnology companies that have revenues or have received greater funding
to date which can offer greater compensation packages. The fees of directors are also rising in response to their increased duties,
obligations and liabilities. In addition, our products could potentially be harmful to users, and we are exposed to claims of
product liability including for injury or death. We have limited insurance and may not be able to afford robust coverage even
as our products are introduced into the market. As a company with limited resources and potential exposures to management, we
will have a more difficult time attracting and retaining management and outside independent directors than a more established
public or private company due to these enhanced duties, obligations and potential liabilities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>If we fail to comply with extensive regulations of U.S.
and foreign regulatory agencies, the commercialization of our products could be delayed or prevented entirely.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our Hemopurifier products are subject to
extensive government regulations related to development, testing, manufacturing and commercialization in the U.S. and other countries.
The determination of when and whether a product is ready for large-scale purchase and potential use will be made by the U.S. Government
through consultation with a number of governmental agencies, including the FDA, the National Institutes of Health, the Centers
for Disease Control and Prevention, and the Department of Homeland Security. Our product candidates are in the pre-clinical and
early-stage or feasibility clinical stages of development and have not received required regulatory approval from the FDA, or
any foreign regulatory agencies, to be commercially marketed and sold. The process of obtaining and complying with FDA and other
governmental regulatory approvals and regulations in the U.S. and in foreign countries is costly, time consuming, uncertain, and
subject to unanticipated delays. Obtaining such regulatory approvals, if any, can take several years. Despite the time and expense
exerted, regulatory approval is never guaranteed. We also are subject to the following risks and obligations, among others:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">the FDA may refuse to approve an application if they believe that applicable
    regulatory criteria are not satisfied;</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">the FDA may require additional testing for safety and effectiveness;</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">the FDA may interpret data from pre-clinical testing and clinical trials
    in different ways than we interpret them;</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">if regulatory approval of a product is granted, the approval may be limited
    to specific indications or limited with respect to its distribution; and</TD></TR>
</TABLE>




<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">the FDA may change their approval policies and/or adopt new regulations.</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Failure to comply with these or other regulatory requirements
of the FDA may subject us to administrative or judicially imposed sanctions, including:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">warning letters;</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">civil penalties;</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">criminal penalties;</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">injunctions;</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">product seizure or detention;</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">product recalls; and</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">total or partial suspension of productions.</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Delays in successfully completing our planned clinical
trials could jeopardize our ability to obtain regulatory approval.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our business prospects will depend on our
ability to complete studies, clinical trials, obtain satisfactory results, obtain required regulatory approvals and successfully
commercialize our Hemopurifier product candidates. Commencement or completion of our clinical trials, announcement of results
of the trials and our ability to obtain regulatory approvals could be delayed for a variety of reasons, including:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">serious adverse events related to our medical device candidates;</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">unsatisfactory results of any clinical trial;</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt"><FONT STYLE="font-family: Times New Roman, Times, Serif">the failure of
    our principal third-party investigators to perform our clinical trials on our anticipated schedules; and</FONT></TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">different interpretations of our pre-clinical and clinical data, which
    could initially lead to inconclusive results.</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our development costs will increase if
we have material delays in any clinical trial or if we need to perform more or larger clinical trials than planned. If the delays
are significant, or if any of our product candidates do not prove to be safe or effective or do not receive required regulatory
approvals, our financial results and the commercial prospects for our product candidates will be harmed. Furthermore, our inability
to complete our clinical trials in a timely manner could jeopardize our ability to obtain regulatory approval.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>If we or our suppliers fail to comply with ongoing FDA
or foreign regulatory authority requirements, or if we experience unanticipated problems with our products, these products could
be subject to restrictions or withdrawal from the market.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Any product for which we obtain clearance
or approval, and the manufacturing processes, reporting requirements, post-approval clinical data and promotional activities for
such product, will be subject to continued regulatory review, oversight and periodic inspections by the FDA and other domestic
and foreign regulatory bodies. In particular, we and our third-party suppliers may be required to comply with the FDA&rsquo;s
Quality System Regulation, or QSR. These FDA regulations cover the methods and documentation of the design, testing, production,
control, quality assurance, labeling, packaging, sterilization, storage and shipping of our products. Compliance with applicable
regulatory requirements is subject to continual review and is monitored rigorously through periodic inspections by the FDA. If
we, or our manufacturers, fail to adhere to QSR requirements in the U.S., this could delay production of our products and lead
to fines, difficulties in obtaining regulatory clearances, recalls, enforcement actions, including injunctive relief or consent
decrees, or other consequences, which could, in turn, have a material adverse effect on our financial condition or results of
operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In addition, the FDA assesses compliance
with the QSR through periodic announced and unannounced inspections of manufacturing and other facilities. The failure by us or
one of our suppliers to comply with applicable statutes and regulations administered by the FDA, or the failure to timely and
adequately respond to any adverse inspectional observations or product safety issues, could result in any of the following enforcement
actions:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">untitled letters, warning letters, fines, injunctions, consent decrees
    and civil penalties;</TD></TR>
</TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">unanticipated expenditures to address or defend such actions;</TD></TR>
</TABLE>




<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">customer notifications or repair, replacement, refunds, recall, detention
    or seizure of our products;</TD></TR>
</TABLE>




<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">operating restrictions or partial suspension or total shutdown of production;</TD></TR>
</TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">refusing or delaying our requests for 510(k) clearance or premarket approval
    of new products or modified products;</TD></TR>
</TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">withdrawing 510(k) clearances or premarket approvals that have already
    been granted;</TD></TR>
</TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">refusal to grant export approval for our products; or</TD></TR>
</TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">criminal prosecution.</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Any of these sanctions could have a material
adverse effect on our reputation, business, results of operations and financial condition. Furthermore, our key component suppliers
may not currently be or may not continue to be in compliance with all applicable regulatory requirements, which could result in
our failure to produce our products on a timely basis and in the required quantities, if at all.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>If our products, or malfunction of our products, cause
or contribute to a death or a serious injury, we will be subject to medical device reporting regulations, which can result in
voluntary corrective actions or agency enforcement actions.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Under the FDA medical device reporting
regulations, medical device manufacturers are required to report to the FDA information that a device has or may have caused or
contributed to a death or serious injury or has malfunctioned in a way that would likely cause or contribute to death or serious
injury if the malfunction of the device or one of our similar devices were to recur. If we fail to report these events to the
FDA within the required timeframes, or at all, FDA could take enforcement action against us. Any such adverse event involving
our products also could result in future voluntary corrective actions, such as recalls or customer notifications, or agency action,
such as inspection or enforcement action. Any corrective action, whether voluntary or involuntary, as well as defending ourselves
in a lawsuit, will require the dedication of our time and capital, distract management from operating our business, and may harm
our reputation and financial results.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Our products may in the future be subject to product
recalls. A recall of our products, either voluntarily or at the direction of the FDA or another governmental authority, including
a third-country authority, or the discovery of serious safety issues with our products, could have a significant adverse impact
on us.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The FDA and similar foreign governmental
authorities have the authority to require the recall of commercialized products in the event of material deficiencies or defects
in design or manufacture. In this case, the FDA, the authority to require a recall must be based on an FDA finding that there
is reasonable probability that the device would cause serious injury or death. In addition, foreign governmental bodies have the
authority to require the recall of our products in the event of material deficiencies or defects in design or manufacture. Manufacturers
may, under their own initiative, recall a product if any material deficiency in a device is found. The FDA requires that certain
classifications of recalls be reported to the FDA within 10 working days after the recall is initiated. A government-mandated
or voluntary recall by us or one of our international distributors could occur as a result of an unacceptable risk to health,
component failures, malfunctions, manufacturing errors, design or labeling defects or other deficiencies and issues. Recalls of
any of our products would divert managerial and financial resources and have an adverse effect on our reputation, results of operations
and financial condition, which could impair our ability to produce our products in a cost-effective and timely manner in order
to meet our customers&rsquo; demands. We may also be subject to liability claims, be required to bear other costs, or take other
actions that may have a negative impact on our future sales and our ability to generate profits. Companies are required to maintain
certain records of recalls, even if they are not reportable to the FDA or another third-country competent authority. We may initiate
voluntary recalls involving our products in the future that we determine do not require notification of the FDA or another third-country
competent authority. If the FDA disagrees with our determinations, they could require us to report those actions as recalls. A
future recall announcement could harm our reputation with customers and negatively affect our sales. In addition, the FDA could
take enforcement action for failing to report the recalls when they were.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We are also required to follow detailed
recordkeeping requirements for all firm-initiated medical device corrections and removals. In addition, in December of 2012, the
FDA issued a draft guidance intended to assist the FDA and industry in distinguishing medical device recalls from product enhancements.
Per the guidance, if any change or group of changes to a device addresses a violation of the Federal Food, Drug, and Cosmetic
Act, that change would generally constitute a medical device recall and require submission of a recall report to the FDA.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">W<B><I>e outsource almost all of our operational and development
activities, and if any party to which we have outsourced certain essential functions fails to perform its obligations under agreements
with us, the development and commercialization of our lead product candidate and any future product candidates that we may develop
could be delayed or terminated.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We generally rely on third-party consultants
or other vendors to manage and implement the day-to-day conduct of our operations, including conducting clinical trials, if such
are approved by the FDA, and manufacturing our current product candidates and any future product candidates that we may develop.
Accordingly, we are and will continue to be dependent on the timeliness and effectiveness of their efforts. Our dependence on
third parties includes key suppliers and third-party service providers supporting the development, manufacture and regulatory
approval of our products as well as support for our information technology systems and other infrastructure. While our management
team oversees these vendors, failure of any of these third parties to meet their contractual, regulatory and other obligations
or the development of factors that materially disrupt the performance of these third parties could have a material adverse effect
on our business. For example, all of the key oversight responsibilities for the development and manufacture of our lead product
candidate are conducted by our management team but all activities are the responsibility of third-party vendors.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">If a clinical research organization that
we utilize is unable to allocate sufficient qualified personnel to our studies in a timely manner or if the work performed by
it does not fully satisfy the requirements of the FDA or other regulatory agencies, we may encounter substantial delays and increased
costs in completing our development efforts. Any manufacturer that we select may encounter difficulties in the manufacture of
new products in commercial quantities, including problems involving product yields, product stability or shelf life, quality control,
adequacy of control procedures and policies, compliance with FDA regulations and the need for further FDA approval of any new
manufacturing processes and facilities. If any of these occur, the development and commercialization of our product candidates
could be delayed, curtailed or terminated because we may not have sufficient financial resources or capabilities to continue such
development and commercialization on our own. If we rely on only one source for the manufacture of the clinical or commercial
supplies of any of our product candidates or products, any production problems or supply constraints with that manufacturer could
adversely impact the development or commercialization of that product candidate or product.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>If we or our contractors or service providers fail to
comply with regulatory laws and regulations, we or they could be subject to regulatory actions, which could affect our ability
to develop, market and sell our product candidates and any other or future product candidates that we may develop and may harm
our reputation.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">If we or our manufacturers or other third-party
contractors fail to comply with applicable federal, state or foreign laws or regulations, we could be subject to regulatory actions,
which could affect our ability to develop, market and sell our current product candidates or any future product candidates under
development successfully and could harm our reputation and lead to reduced or nonacceptance of our proposed product candidates
by the market. Even technical recommendations or evidence by the FDA through letters, site visits, and overall recommendations
to academia or biotechnology companies may make the manufacturing of a clinical product extremely labor intensive or expensive,
making the product candidate no longer viable to manufacture in a cost-efficient manner. The mode of administration may make the
product candidate not commercially viable. The required testing of the product candidate may make that candidate no longer commercially
viable. The conduct of clinical trials may be critiqued by the FDA, or a clinical trial site&rsquo;s Institutional Review Board
or Institutional Biosafety Committee, which may delay or make impossible clinical testing of a product candidate. The Institutional
Review Board for a clinical trial may stop a trial or deem a product candidate unsafe to continue testing. This may have a material
adverse effect on the value of the product candidate and our business prospects.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>We have not received, and may never receive, approval
from the FDA to market a medical device in the United States.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Before a new medical device can be marketed
in the U.S., it must first receive either premarket approval, or a PMA, or 510(k) clearance from the FDA, unless an exemption
exists. A PMA submission, which is a higher standard than a 501(k) clearance, is used to demonstrate to the FDA that a new or
modified device is safe and effective. The 510(k) is used to demonstrate that a device is &ldquo;substantially equivalent&rdquo;
to a predicate device (one that has been cleared by the FDA). We expect that any product we seek regulatory approval for will
require a PMA. The FDA approval process involves, among other things, successfully completing clinical trials and filing for and
obtaining a PMA. The PMA process requires us to prove the safety and effectiveness of our products to the FDA&rsquo;s satisfaction.
This process, which includes preclinical studies and clinical trials, can take many years and requires the expenditure of substantial
resources and may include post-marketing surveillance to establish the safety and efficacy of the product. Notwithstanding the
effort and expense incurred, the process may never result in the FDA granting a PMA. Data obtained from preclinical studies and
clinical trials are subject to varying interpretations that could delay, limit or prevent regulatory approval. Delays or rejections
may also be encountered based upon changes in governmental policies for medical devices during the period of product development.
The FDA can delay, limit or deny approval of a PMA application for many reasons, including:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>our inability
                                         to demonstrate safety or effectiveness to the FDA&rsquo;s satisfaction;</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>insufficient
                                         data from our preclinical studies and clinical trials to support approval;</TD></TR></TABLE>


<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>failure
                                         of the facilities of our third-party manufacturer or suppliers to meet applicable requirements;</TD></TR></TABLE>


<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>inadequate
                                         compliance with preclinical, clinical or other regulations;</TD></TR></TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>our failure
                                         to meet the FDA&rsquo;s statistical requirements for approval; and</TD></TR></TABLE>


<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>changes
                                         in the FDA&rsquo;s approval policies, or the adoption of new regulations that require
                                         additional data or additional clinical studies.</TD></TR></TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Modifications to products that are approved
through a PMA application generally need FDA approval. Similarly, some modifications made to products cleared through a 510(k)
may require a new 510(k). The FDA&rsquo;s 510(k) clearance process usually takes from three to 12 months, but may last longer.
The process of obtaining a PMA is much costlier and uncertain than the 510(k) clearance process and generally takes from one to
three years, or even longer, from the time the application is submitted to the FDA until an approval is obtained. Any of our products
considered to be a class III device, which are considered to pose the greatest risk and the approval of which is governed by the
strictest guidelines, will require the submission and approval of a PMA in order for us to market it in the U.S. We also may design
new products in the future that could require the clearance of a 510(k).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Although FDA has permitted several early-stage
or feasibility clinical trials to proceed in the U.S. under an investigational device exemption (IDE), we cannot assure you that
FDA will not place an IDE on clinical hold, or that any study will be successful, or that the FDA PMA approval will eventually
be obtained and not withdrawn. Even if we obtain approval, the FDA or other regulatory authorities may require expensive or burdensome
post-market testing or controls. Any delay in, or failure to receive or maintain, clearance or approval for our future products
could prevent us from generating revenue from these products or achieving profitability. Additionally, the FDA and other regulatory
authorities have broad enforcement powers. Regulatory enforcement or inquiries, or other increased scrutiny on us, could dissuade
some physicians from using our products and adversely affect our reputation and the perceived safety and efficacy of our products.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>The approval requirements for medical products used to
fight bioterrorism are still evolving, and we cannot be certain any products we develop for such uses would meet these requirements.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We are advancing product candidates under
governmental policies that regulate the development and commercialization of medical treatment countermeasures against certain
bioterror and pandemic threats. While we intend to pursue FDA market approval or clearance to treat infectious bioterror and pandemic
threats, it is often not feasible to conduct human studies against these deadly high-threat pathogens. Thus, we may not be able
to demonstrate the effectiveness of our treatment countermeasures through controlled human efficacy studies. Additionally, a change
in government policies could impair our ability to obtain regulatory approval, and there is no assurance that the FDA will approve
any of our product candidates.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>The Hemopurifier was used to treat one patient suffering
from Ebola, and we have received a supplement to our investigational device exemption to establish protocols to treat Ebola patients
in the U.S.; however, you should not construe these events as demonstrating that the device is effective in treating Ebola.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In October 2014, physicians at the Frankfurt
University Hospital in Frankfurt, Germany administered Hemopurifier therapy in a 6.5-hour treatment session to a patient infected
with Ebola. This treatment was made on an emergency basis. The patient was administered Hemopurifier therapy through special approval
from The Federal Institute for Drugs and Medical Devices (Bundesinstitut fur Arzneimittel und Medizinprodukte, BfArM), an independent
federal higher authority within the portfolio of the Federal Ministry of Health of Germany. While we believe the results of the
treatment of the Ebola patient in Germany to be positive with respect to the usage of the Hemopurifier to combat Ebola, no medical
organization or regulatory organization, inside or outside the U.S., has cleared the use of the device for Ebola treatment on
a commercial basis.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In addition, although the FDA permitted
a supplement to our investigational device exemption to establish a protocol for the treatment of Ebola patients in the U.S.,
this approval is very limited and the results of such protocol and potential treatments, if any, cannot be predicted. The usefulness
of the Hemopurifier in treating Ebola is still unproven in any clinical or regulatory process in the U.S. or elsewhere. Even if
we enroll patients in the Ebola protocol, the results of such treatments may not demonstrate the safety and efficacy of the device,
may be equivocal or may otherwise not be sufficient to obtain approval of the Hemopurifier for any uses associated with Ebola.
In addition, the approval of the supplement to our investigational device exemption does not in any way ensure clearance or approval
of the Hemopurifier device for any purpose. In April 2015, we submitted a Humanitarian Use Devise (HUD) submission to the FDA
to support market clearance of the Hemopurifier as a treatment for Ebola virus. FDA denied the submission, because our product
includes a biological product (lectin) that has been approved in another device with a different indication. If we resolve the
biological issue, and the application is designated by the FDA as an HUD, we then may submit a Humanitarian Device Exemption marketing
application to the Center for Devices and Radiological Health for marketing review. We cannot assure you that the Hemopurifier
will be proven to be useful in the treatment of Ebola or that it will ever be approved by U.S. or foreign regulatory agencies
for such use, or if approved, successfully commercialized by us for such use. We may never commercialize the Hemopurifier specifically
for use in treating Ebola.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>The results of our clinical trials may not support our
product candidate claims or may result in the discovery of adverse side effects.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Any research and development, pre-clinical
testing and clinical trial activities involving any products that we are or may develop will be subject to extensive regulation
and review by numerous governmental authorities both in the U.S. and abroad. In the future, we may conduct clinical trials to
support approval of new products. Clinical studies must be conducted in compliance with FDA regulations or the FDA may take enforcement
action. The data collected from these clinical studies may ultimately be used to support market clearance for these products.
Even if our clinical trials are completed as planned, we cannot be certain that their results will support our product candidate
claims or that the FDA will agree with our conclusions regarding them. Success in pre-clinical studies and early clinical trials
does not ensure that later clinical trials will be successful, and we cannot be sure that the later trials will replicate the
results of prior trials and pre-clinical studies. The clinical trial process may fail to demonstrate that our product candidates
are safe and effective for the proposed indicated uses, which could cause us to abandon a product candidate and may delay development
of others. Any delay or termination of our clinical trials will delay the filing of our product submissions and, ultimately, our
ability to commercialize our product candidates and generate revenues. It is also possible that patients enrolled in clinical
trials will experience adverse side effects that are not currently part of the product candidate&rsquo;s profile.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.9pt"><B><I>U.S. legislative or FDA regulatory
reforms may make it more difficult and costly for us to obtain regulatory approval of our product candidates and to manufacture,
market and distribute our products after approval is obtained.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.9pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">From time to time, legislation is drafted
and introduced in Congress that could significantly change the statutory provisions governing the regulatory approval, manufacture
and marketing of regulated products or the reimbursement thereof. In addition, FDA regulations and guidance are often revised
or reinterpreted by the FDA in ways that may significantly affect our business and our products. Any new regulations or revisions
or reinterpretations of existing regulations may impose additional costs or lengthen review times of future products. In addition,
FDA regulations and guidance are often revised or reinterpreted by the agency in ways that may significantly affect our business
and our products. It is impossible to predict whether legislative changes will be enacted or FDA regulations, guidance or interpretations
changed, and what the impact of such changes, if any, may be.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Should our products be approved for commercialization,
lack of third-party coverage and reimbursement for our devices could delay or limit their adoption.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In both the U.S. and international markets,
the use of medical devices is dependent in part on the availability of reimbursement from third-party payors, such as government
and private insurance plans. Healthcare providers that use medical devices generally rely on third-party payors to pay for all
or part of the costs and fees associated with the medical procedures being performed or to compensate them for their patient care
services. Should our products be approved for commercialization by the FDA, we cannot assure you that our future products will
be considered cost-effective, that reimbursement will be available in other sites or in other countries, including the U.S., if
approved, or that reimbursement will be sufficient to allow sales of our future products on a profitable basis. The coverage decisions
of third-party payors will be significantly influenced by the assessment of our future products by health technology assessment
bodies. Such assessments are outside our control and we cannot assure you that such evaluations will be conducted or that they
will have a favorable outcome.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">If approved for use in the U.S., we expect
that any products that we develop will be purchased primarily by medical institutions, which will in turn bill various third-party
payors for the health care services provided to patients at their facility. Payors may include the Centers for Medicare &amp;
Medicaid Services, or CMS, which administers the Medicare program and works in partnership with state governments to administer
Medicaid, other government programs and private insurance plans. The process involved in applying for coverage and incremental
reimbursement from CMS is lengthy and expensive. Further, Medicare coverage is based on our ability to demonstrate the treatment
is &ldquo;reasonable and necessary&rdquo; for Medicare beneficiaries. Even if products utilizing our Aethlon Hemopurifier technology
receive FDA and other regulatory clearance or approval, they may not be granted coverage and reimbursement by any payor, including
by CMS. For some governmental programs, such as Medicaid, coverage and reimbursement differ from state to state and some state
Medicaid programs may not pay adequate amounts for the procedure necessary to utilize products utilizing our technology system,
or any payment at all. Moreover, many private payors use coverage decisions and payment amounts determined by CMS as guidelines
in setting their coverage and reimbursement policies and amounts. If CMS or other agencies limit coverage or decrease or limit
reimbursement payments for doctors and hospitals, this may affect coverage and reimbursement determinations by many private payors.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Should our products be approved for commercialization,
adverse changes in reimbursement policies and procedures by payors may impact our ability to market and sell our products.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Healthcare costs have risen significantly
over the past decade, and there have been and continue to be proposals by legislators, regulators and third-party payors to decrease
costs. Third-party payors are increasingly challenging the prices charged for medical products and services and instituting cost
containment measures to control or significantly influence the purchase of medical products and services.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">For example, in the U.S., the Patient Protection
and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act of 2010, or collectively, PPACA, among
other things, reduced and/or limited Medicare reimbursement to certain providers. The Budget Control Act of 2011, as amended by
subsequent legislation, further reduces Medicare&rsquo;s payments to providers by 2 percent through fiscal year 2024. These reductions
may reduce providers&rsquo; revenues or profits, which could affect their ability to purchase new technologies. Furthermore, the
healthcare industry in the U.S. has experienced a trend toward cost containment as government and private insurers seek to control
healthcare costs by imposing lower payment rates and negotiating reduced contract rates with service providers. Legislation could
be adopted in the future that limits payments for our products from governmental payors. In addition, commercial payors such as
insurance companies, could adopt similar policies that limit reimbursement for medical device manufacturers&rsquo; products. Therefore,
we cannot be certain that our product or the procedures or patient care performed using our product will be reimbursed at a cost-effective
level. We face similar risks relating to adverse changes in reimbursement procedures and policies in other countries where we
may market our products. Reimbursement and healthcare payment systems vary significantly among international markets. Our inability
to obtain international reimbursement approval, or any adverse changes in the reimbursement policies of foreign payors, could
negatively affect our ability to sell our products and have a material adverse effect on our business and financial condition.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Should our products be approved for commercialization,
our financial performance may be adversely affected by medical device tax provisions in the healthcare reform laws.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">PPACA currently imposes, among other things,
an excise tax of 2.3% on any entity that manufactures or imports medical devices offered for sale in the U.S. Under these provisions,
the Congressional Research Service predicts that the total cost to the medical device industry may be up to $20 billion over the
next decade. The Internal Revenue Service issued final regulations implementing the tax in December 2012, which requires, among
other things, bi-monthly payments and quarterly reporting.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The Consolidated Appropriations Act, 2016
(Pub. L. 114-113), signed into law on Dec. 18, 2015, includes a two-year moratorium on the medical device excise tax imposed by
Internal Revenue Code section 4191. Thus, the medical device excise tax does not apply to the sale of a taxable medical device
by the manufacturer, producer, or importer of the device during the period beginning on January 1, 2016, and ending on December
31, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">If we are successful in marketing any products,
if this regulation is not repealed, we will be subject to this or any future excise tax on our sales of certain medical devices
in the U.S. We anticipate that primarily all of our sales, once commenced, of medical devices in the U.S. will be subject to this
2.3% excise tax following December 31, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Risks Related to Our Intellectual Property and Related Litigation</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>We rely upon licenses and patent rights from third parties
which are subject to termination or expiration.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We rely upon third-party licenses and ownership
rights assigned from third parties for the development of specific uses for our Hemopurifier devices. For example, we are researching,
developing and testing cancer-related applications for our devices under patents assigned from the London Health Science Center
Research, Inc. Should any of our licenses be prematurely terminated for any reason, or if the patents and intellectual property
assigned to us or owned by such entities that we have licensed should be challenged or defeated by third parties, our research
efforts could be materially and adversely affected. We cannot assure you that any of our licenses or patents assigned to us will
continue in force for as long as we require for our research, development and testing of cancer treatments. We cannot assure you
that, should our licenses terminate, should the underlying patents and intellectual property be challenged or defeated, or should
patents and intellectual property assigned to us be challenged or defeated, suitable replacements can be obtained or developed
on terms acceptable to us, if at all. There is also the related risk that we may not be able to make the required payments under
any patent license or assignment agreement, in which case we may lose to ability to use one or more of the licensed or assigned
patents.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>We could become subject to intellectual property litigation
that could be costly, result in the diversion of management&rsquo;s time and efforts, require us to pay damages, prevent us from
selling our commercially available products and/or reduce the margins we may realize from our products.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The medical devices industry is characterized
by extensive litigation and administrative proceedings over patent and other intellectual property rights. Whether a product infringes
a patent involves complex legal and factual issues, and the determination is often uncertain. There may be existing patents of
which we are unaware that our products under development may inadvertently infringe. The likelihood that patent infringement claims
may be brought against us increases as the number of participants in the infectious market increases and as we achieve more visibility
in the market place and introduce products to market.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Any infringement claim against us, even
if without merit, may cause us to incur substantial costs, and would place a significant strain on our financial resources, divert
the attention of management from our core business, and harm our reputation. In some cases, litigation may be threatened or brought
by a patent holding company or other adverse patent owner who has no relevant product revenues and against whom our patents may
provide little or no deterrence. If we were found to infringe any patents, we could be required to pay substantial damages, including
triple damages if an infringement is found to be willful. We also could be required to pay royalties and could be prevented from
selling our products unless we obtain a license or are able to redesign our products to avoid infringement. We may not be able
to obtain a license enabling us to sell our products on reasonable terms, or at all, and we cannot assure you that we would be
able to redesign our products in a way that would not infringe those patents. If we fail to obtain any required licenses or make
any necessary changes to our technologies or the products that incorporate them, we may be unable to commercialize one or more
of our products or may have to withdraw products from the market, all of which would have a material adverse effect on our business,
financial condition and results of operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.9pt"><B><I>If the combination of patents, trade
secrets and contractual provisions upon which we rely to protect our intellectual property is inadequate, our ability to commercialize
our products successfully will be harmed.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.9pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our success depends significantly on our
ability to protect our proprietary rights to the technologies incorporated in our products. We currently have four issued U.S.
patents and seven pending U.S. patent applications. We also have eighteen issued foreign patents and have applied for eight additional
international patents. Our issued patents begin to expire in 2019, with the last of these patents expiring in 2029, although terminal
disclaimers, patent term extension or patent term adjustment can shorten or lengthen the patent term. We rely on a combination
of patent protection, trade secret laws and nondisclosure, confidentiality and other contractual restrictions to protect our proprietary
technology. However, these may not adequately protect our rights or permit us to gain or keep any competitive advantage.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The issuance of a patent is not conclusive
as to its scope, validity or enforceability. The scope, validity or enforceability of our issued patents can be challenged in
litigation or proceedings before the U.S. Patent and Trademark Office or foreign patent offices where our applications are pending.
The U.S. Patent and Trademark Office or foreign offices may deny or require significant narrowing of claims in our pending patent
applications. Patents issued as a result of the pending patent applications, if any, may not provide us with significant commercial
protection or be issued in a form that is advantageous to us. Proceedings before the U.S. Patent and Trademark Office or foreign
offices could result in adverse decisions as to the priority of our inventions and the narrowing or invalidation of claims in
issued patents. The laws of some foreign countries may not protect our intellectual property rights to the same extent as the
laws of the U.S., if at all. Some of our patents may expire before we receive FDA approval to market our products in the U.S.
or we receive approval to market our products in a foreign country. Although we believe that certain patent applications and/or
other patents issued more recently will help protect the proprietary nature of the Hemopurifier treatment technology, we cannot
assure you that this protection will be sufficient to protect us during the development of that technology.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our competitors may successfully challenge
and invalidate or render unenforceable our issued patents, including any patents that may issue in the future, which could prevent
or limit our ability to market our products and could limit our ability to stop competitors from marketing products that are substantially
equivalent to ours. In addition, competitors may be able to design around our patents or develop products that provide outcomes
that are comparable to our products but that are not covered by our patents.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have also entered into confidentiality
and assignment of intellectual property agreements with all of our employees, consultants and advisors directly involved in the
development of our technology as one of the ways we seek to protect our intellectual property and other proprietary technology.
However, these agreements may not be enforceable or may not provide meaningful protection for our trade secrets or other proprietary
information in the event of unauthorized use or disclosure or other breaches of the agreements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In the event a competitor infringes upon
any of our patents or other intellectual property rights, enforcing our rights may be difficult, time consuming and expensive,
and would divert management&rsquo;s attention from managing our business. We cannot assure you that we will be successful on the
merits in any enforcement effort. In addition, we may not have sufficient resources to litigate, enforce or defend our intellectual
property rights.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>We may rely on licenses for new technology, which may
affect our continued operations with respect thereto.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">As we develop our technology, we may need
to license additional technologies to optimize the performance of our products. We may not be able to license these technologies
on commercially reasonable terms or at all. In addition, we may fail to successfully integrate any licensed technology into our
proposed products. Our inability to obtain any necessary licenses could delay our product development and testing until alternative
technologies can be identified, licensed and integrated. The inability to obtain any necessary third-party licenses could cause
us to abandon a particular development path, which could seriously harm our business, financial position and results of our operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>If we are unable to protect our proprietary technology
and preserve our trade secrets, we will increase our vulnerability to competitors which could materially adversely impact our
ability to remain in business.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our ability to successfully commercialize
our products will depend on our ability to protect those products and our technology with domestic and foreign patents. We will
also need to continue to preserve our trade secrets. The issuance of a patent is not conclusive as to its validity or as to the
enforceable scope of the claims of the patent. The patent positions of technology companies, including us, are uncertain and involve
complex legal and factual issues. We cannot assure you that our patents will prevent other companies from developing similar products
or products which produce benefits substantially the same as our products, or that other companies will not be issued patents
that may prevent the sale of our products or require us to pay significant licensing fees in order to market our products.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">From time to time, we may need to obtain
licenses to patents and other proprietary rights held by third parties in order to develop, manufacture and market our products.
If we are unable to timely obtain these licenses on commercially reasonable terms, our ability to commercially exploit such products
may be inhibited or prevented. Additionally, we cannot assure investors that any of our products or technology will be patentable
or that any future patents we obtain will give us an exclusive position in the subject matter claimed by those patents. Furthermore,
we cannot assure investors that our pending patent applications will result in issued patents, that patent protection will be
secured for any particular technology, or that our issued patents will be valid or enforceable or provide us with meaningful protection.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>If we are required to engage in expensive and lengthy
litigation to enforce our intellectual property rights, such litigation could be very costly and the results of such litigation
may not be satisfactory.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Although we have entered into invention
assignment agreements with our employees and with certain advisors, and we routinely enter into confidentiality agreements with
our contract partners, if those employees, advisors or contract partners develop inventions or processes independently that may
relate to products or technology under development by us, disputes may arise about the ownership of those inventions or processes.
Time-consuming and costly litigation could be necessary to enforce and determine the scope of our rights under these agreements.
In addition, we may be required to commence litigation to enforce such agreements if they are violated, and it is certainly possible
that we will not have adequate remedies for breaches of our confidentiality agreements as monetary damages may not be sufficient
to compensate us. In addition, we may be unable to fund the costs of such litigation to a satisfactory conclusion, which could
leave us without recourse to enforce contracts that protect our intellectual property rights.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Other companies may claim that our technology infringes
on their intellectual property or proprietary rights and commence legal proceedings against us which could be time-consuming and
expensive and could result in our being prohibited from developing, marketing, selling or distributing our products.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Because of the complex and difficult legal
and factual questions that relate to patent positions in our industry, we cannot assure you that our products or technology will
not be found to infringe upon the intellectual property or proprietary rights of others. Third parties may claim that our products
or technology infringe on their patents, copyrights, trademarks or other proprietary rights and demand that we cease development
or marketing of those products or technology or pay license fees. We may not be able to avoid costly patent infringement litigation,
which will divert the attention of management away from the development of new products and the operation of our business. We
cannot assure investors that we would prevail in any such litigation. If we are found to have infringed on a third-party&rsquo;s
intellectual property rights, we may be liable for money damages, encounter significant delays in bringing products to market
or be precluded from manufacturing particular products or using particular technology.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Other parties may challenge certain of
our foreign patent applications. If such parties are successful in opposing our foreign patent applications, we may not gain the
protection afforded by those patent applications in particular jurisdictions and may face additional proceedings with respect
to similar patents in other jurisdictions, as well as related patents. The loss of patent protection in one jurisdiction may influence
our ability to maintain patent protection for the same technology in other jurisdictions.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt"><B>Risks Related to
U.S. Government Contracts</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>We may not obtain additional U.S. Government contracts
to further develop our technology.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our prior contract with DARPA has been
completed. We can give no assurances that we will be successful in obtaining additional government grants or contracts. The process
of obtaining government contracts is lengthy. Accordingly, we cannot be certain that we will be awarded any additional U.S. Government
grants or contracts utilizing our Hemopurifier platform technology.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>U.S. Government agencies have special contracting requirements
including a right to audit us which create additional risks</I></B>; <B><I>a negative audit would be detrimental to us.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our business plan to utilize the Aethlon
Hemopurifier technology may continue to involve contracts with the U.S. Government. Such contracts typically contain unfavorable
termination provisions and are subject to audit and modification by the government at its sole discretion, which subjects us to
additional risks. These risks include the ability of the U.S. Government to unilaterally:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>suspend
                                         or prevent us for a period of time from receiving new contracts or extending existing
                                         contracts based on violations or suspected violations of laws or regulations;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>audit
                                         and object to our contract-related costs and fees, including allocated indirect costs;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>control
                                         and potentially prohibit the export of our products; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>change
                                         certain terms and conditions in our contracts.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">As a U.S. Government contractor, we would
be required to comply with applicable laws, regulations and standards relating to our accounting practices and would be subject
to periodic audits and reviews. As part of any such audit or review, the U.S. Government may review the adequacy of, and our compliance
with, our internal control systems and policies, including those relating to our purchasing, property, estimating, compensation
and management information systems. Based on the results of its audits, the U.S. Government may adjust our contract-related costs
and fees, including allocated indirect costs. In addition, if an audit or review uncovers any improper or illegal activity, we
would possibly be subject to civil and criminal penalties and administrative sanctions, including termination of our contracts,
forfeiture of profits, suspension of payments, fines and suspension or prohibition from doing business with the U.S. Government.
We could also suffer serious harm to our reputation if allegations of impropriety were made against us. Although we have not had
any government audits and reviews to date, future audits and reviews could cause adverse effects. In addition, under U.S. Government
purchasing regulations, some of our costs, including most financing costs, amortization of intangible assets, portions of our
research and development costs, and some marketing expenses, would possibly not be reimbursable or allowed under such contracts.
Further, as a U.S. Government contractor, we would be subject to an increased risk of investigations, criminal prosecution, civil
fraud, whistleblower lawsuits and other legal actions and liabilities to which purely private sector companies are not.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>As a U.S. Government contractor, we would be subject
to a number of procurement rules and regulations. </I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Government contractors must comply with
specific procurement regulations and other requirements. These requirements, although customary in government contracts, could
impact our performance and compliance costs. In addition, current U.S. Government budgetary constraints could lead to changes
in the procurement environment, including the Department of Defense&rsquo;s recent initiative focused on efficiencies, affordability
and cost growth and other changes to its procurement practices. If and to the extent such changes occur, they could impact our
results of operations and liquidity, and could affect whether and, if so, how we pursue certain opportunities and the terms under
which we are able to do so.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In addition, failure to comply with these
regulations and requirements could result in reductions of the value of contracts, contract modifications or termination, and
the assessment of penalties and fines, which could negatively impact our results of operations and financial condition. Our failure
to comply with these regulations and requirements could also lead to suspension or debarment, for cause, from government contracting
or subcontracting for a period of time. Among the causes for debarment are violations of various statutes, including those related
to procurement integrity, export control, government security regulations, employment practices, protection of the environment,
accuracy of records and the recording of costs, and foreign corruption. The termination of our government contract as a result
of any of these acts could have a negative impact on our results of operations and financial condition and could have a negative
impact on our reputation and ability to procure other government contracts in the future.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt"><B>Risks Relating to
Our Common Stock and Our Corporate Governance</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>We have never paid dividends on our common stock, and
we do not anticipate paying any cash dividends in the foreseeable future.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have never paid cash dividends on our
common stock. We intend to retain our future earnings, if any, to fund operational and capital expenditure needs of our business,
and do not anticipate paying any cash dividends in the foreseeable future. Furthermore, future financing instruments may do the
same. As a result, capital appreciation, if any, of our common stock will be the sole source of gain for our common stockholders
in the foreseeable future.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Our stock price is speculative, and there is a risk of
litigation.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The trading price of our common stock has
in the past and may in the future be subject to wide fluctuations in response to factors such as the following:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>our future
                                         clinical results, or lack thereof;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>revenue
                                         or results of operations in any quarter failing to meet the expectations, published or
                                         otherwise, of the investment community;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>reduced
                                         investor confidence in equity markets, due in part to corporate collapses in recent years;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>speculation
                                         in the press or analyst community;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>wide
                                         fluctuations in stock prices, particularly with respect to the stock prices for other
                                         medical device companies;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>announcements
                                         of technological innovations by us or our competitors;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>new products
                                         or the acquisition of significant customers by us or our competitors;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>changes
                                         in interest rates;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>changes
                                         in investors&rsquo; beliefs as to the appropriate price-earnings ratios for us and our
                                         competitors;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">changes
                                         in recommendations or financial estimates by securities analysts who track our common
                                         stock or the stock of other medical device companies;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"></P>

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<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

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<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">changes
                                         in management;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">sales
                                         of common stock by directors and executive officers;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">rumors
                                         or dissemination of false or misleading information, particularly through Internet chat
                                         rooms, instant messaging, and other rapid-dissemination methods;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">conditions
                                         and trends in the medical device industry generally;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">the
                                         announcement of acquisitions or other significant transactions by us or our competitors;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">adoption
                                         of new accounting standards affecting our industry;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">general
                                         market conditions;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">domestic
                                         or international terrorism and other factors; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">the
                                         other factors described in this section.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Fluctuations in the price of our common stock may expose us
to the risk of securities class action lawsuits. Although no such lawsuits are currently pending against us and we are not aware
that any such lawsuit is threatened to be filed in the future, there is no assurance that we will not be sued based on fluctuations
in the price of our common stock. Defending against such suits could result in substantial cost and divert management&rsquo;s
attention and resources. In addition, any settlement or adverse determination of such lawsuits could subject us to significant
liability.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>If at any time our common stock is subject to the Securities
and Exchange Commission&rsquo;s penny stock rules, broker-dealers may experience difficulty in completing customer transactions
and trading activity in our securities may be adversely affected.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">If at any time our common stock is not
listed on a national securities exchange or we have net tangible assets of $5,000,000 or less and our common stock has a market
price per share of less than $5.00, transactions in our common stock will be subject to the Securities and Exchange Commission&rsquo;s,
or SEC&rsquo;s, &ldquo;penny stock&rdquo; rules. If our common stock is subject to the &ldquo;penny stock&rdquo; rules promulgated
under the Exchange Act, broker-dealers may find it difficult to effectuate customer transactions and trading activity in our securities
may be adversely affected. For any transaction involving a penny stock, unless exempt, the rules require:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>that
                                         a broker or dealer approve a person&rsquo;s account for transactions in penny stocks;
                                         and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>the broker
                                         or dealer receive from the investor a written agreement to the transaction, setting forth
                                         the identity and quantity of the penny stock to be purchased.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In order to approve a person&rsquo;s account
for transactions in penny stocks, the broker or dealer must:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>obtain
                                         financial information and investment experience objectives of the person; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>make
                                         a reasonable determination that the transactions in penny stocks are suitable for that
                                         person and the person has sufficient knowledge and experience in financial matters to
                                         be capable of evaluating the risks of transactions in penny stocks.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The broker or dealer must also deliver,
prior to any transaction in a penny stock, a disclosure schedule prescribed by the Securities and Exchange Commission relating
to the penny stock market, which, in highlight form:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>sets
                                         forth the basis on which the broker or dealer made the suitability determination; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>that
                                         the broker or dealer received a signed, written agreement from the investor prior to
                                         the transaction.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"></P>

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<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Generally, brokers may be less willing
to execute transactions in securities subject to the &ldquo;penny stock&rdquo; rules. This may make it more difficult for investors
to dispose of our common stock and cause a decline in the market value of our stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Disclosure also has to be made about the
risks of investing in penny stocks in both public offerings and in secondary trading and about the commissions payable to both
the broker-dealer and the registered representative, current quotations for the securities and the rights and remedies available
to an investor in cases of fraud in penny stock transactions. Finally, monthly statements have to be sent disclosing recent price
information for the penny stock held in the account and information on the limited market in penny stocks.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Our common stock has had an unpredictable trading volume
which means you may not be able to sell our shares at or near trading prices or at all.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Trading in our common shares historically
has been volatile and often has been thin, meaning that the number of persons interested in purchasing our common shares at or
near trading prices at any given time may be relatively small or non-existent. This situation is attributable to a number of factors,
including the fact that we are a small company which is relatively unknown to stock analysts, stock brokers, institutional investors
and others in the investment community that generate or influence sales volume, and that even if we came to the attention of such
persons, they tend to be risk-averse and would be reluctant to follow an unproven company such as ours or purchase or recommend
the purchase of our shares until such time as we became more seasoned and viable. As a consequence, there may be periods of several
days or more when trading activity in our shares is minimal, as compared to a seasoned issuer which has a large and steady volume
of trading activity that will generally support continuous sales without an adverse effect on share price. We cannot give you
any assurance that a broader or more active public trading market for our common shares will develop or be sustained, or that
current trading levels will be sustained.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>The market price for our common stock is volatile; you
may not be able to sell our common stock at or above the price you have paid for them, which may result in losses to you.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The market for our common shares is characterized
by significant price volatility when compared to seasoned issuers, and we expect that our share price will continue to be more
volatile than a seasoned issuer for the indefinite future. In fact, during the 52-week period ended March 31, 2017, the high and
low closing sale prices of a share of our common stock were $7.70 and $3.19, respectively. The volatility in our share price is
attributable to a number of factors. First, as noted above, trading in our common shares often has been thin. As a consequence
of this lack of liquidity, the trading of relatively small quantities of shares by our stockholders may disproportionately influence
the price of those shares in either direction. The price for our shares could, for example, decline precipitously in the event
that a large number of our common shares are sold on the market without commensurate demand, as compared to a seasoned issuer
which could better absorb those sales without adverse impact on its share price. Secondly, we are a speculative investment due
to our limited operating history, limited amount of revenue, lack of profit to date, and the uncertainty of future regulatory
approval or market acceptance for our potential products. As a consequence of this enhanced risk, more risk-adverse investors
may, under the fear of losing all or most of their investment in the event of negative news or lack of progress, be more inclined
to sell their shares on the market more quickly and at greater discounts than would be the case with the stock of a seasoned issuer.
The following factors may add to the volatility in the price of our common shares: actual or anticipated variations in our quarterly
or annual operating results; acceptance of our proprietary technology as a viable method of augmenting the immune response of
clearing viruses and toxins from human blood; government regulations, announcements of significant acquisitions, strategic partnerships
or joint ventures; our capital commitments and additions or departures of our key personnel. Many of these factors are beyond
our control and may decrease the market price of our common shares regardless of our operating performance. We cannot make any
predictions or projections as to what the prevailing market price for our common shares will be at any time, including as to whether
our common shares will sustain their current market prices, or as to what effect the sale of shares or the availability of common
shares for sale at any time will have on the prevailing market price.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>We cannot assure you that we will be able to comply with
the continued listing standards of the NASDAQ Capital Market.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We cannot assure you that we will be able
to comply with the listing standards that we are required to meet in order to maintain a listing of our common stock on the NASDAQ
Capital Market (&ldquo;Nasdaq&rdquo;). Our failure to meet those requirements may result in our common stock being delisted
from the NASDAQ Capital Market.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Franklyn S. Barry, Jr, formerly one of
our directors as well as a member of our Audit Committee, for health reasons declined to stand for re-election at the Annual Meeting
of Shareholders held on March 30, 2017. As a result, we have two independent directors and members of our Audit Committee and
thus no longer comply with Nasdaq&rsquo;s independent director and audit committee requirements as set forth in Listing Rule 5605.
We received a notification letter from Nasdaq on April 3, 2017 regarding this noncompliance.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Under Listing Rules 5605(b)(1)(A) and 5605(c)(4),
Nasdaq shall provide us with time to regain compliance either until the earlier of our next annual meeting or March 30, 2018;
or if the next annual meeting is before September 29, 2017, until September 29, 2017. </P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In order to regain compliance, the Company
must submit to Nasdaq documentation, including biographies of any new directors, evidencing compliance with the rules no later
than the applicable date set forth above. We are currently evaluating new candidates to join our board of directors; however,
if this does not occur within the time periods proscribed we could be delisted.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> On August 1, 2017, we
received written notification from the Listing Qualifications Staff of Nasdaq indicating that, based upon our continued
non-compliance with the minimum $35,000,000 market value of listed securities (&ldquo;MVLS&rdquo;) requirement for continued
listing on Nasdaq, as set forth in Nasdaq Listing Rule 5550(b)(2), the Nasdaq Staff had determined to delist our securities
from Nasdaq unless we had timely requested a hearing before the Nasdaq Hearings Panel. We had a hearing on August 30, 2017,
and as a result of the hearing, the Nasdaq Staff has granted an extension until October 31, 2017, for us to present evidence
of compliance with Rule 5550(b)(1), the stockholders&rsquo; equity requirement. If we fail to comply with the continued
listing requirements of Nasdaq, our common stock may be delisted and the price of our common stock and our ability to access
the capital markets could be negatively impacted. </P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The National Securities Markets Improvement
Act of 1996, which is a federal statute, prevents or preempts the states from regulating the sale of certain securities, which
are referred to as &ldquo;covered securities.&rdquo; Because our common stock is listed on the NASDAQ Capital Market, we believe
such securities will be covered securities. Although the states would be preempted from regulating the sale of our securities,
in that event, the federal statute does allow the states to investigate companies if there is a suspicion of fraud, and, if there
is a finding of fraudulent activity, then the states can regulate or bar the sale of covered securities in a particular case.
Further, if our common stock is no longer listed on the NASDAQ Capital Market, our securities would not be covered securities,
and we would be subject to regulation in each state in which we offer our securities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>





<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>The Depository Trust Company imposed
restrictions upon electronic trading of our common stock, which negatively affected liquidity of the stock and our ability to
raise capital.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In September 2011, The Depository Trust
Company placed a &quot;chill&quot; on the electronic clearing of trades in our shares which led to some brokerage firms being
unwilling to accept certificates and/or electronic deposits of our stock. We have since been successful in lifting the restrictions
and our shares now clear electronically making more brokers willing to trade in our common stock. We cannot assure you that The
Depository Trust Company will not again place a chill on our common stock. A chill, if placed on our common stock, would affect
the liquidity of our shares which may make it difficult to purchase or sell shares in the open market. It may also have an adverse
effect on our ability to raise capital since investors may be unable to resell shares into the market. Our inability to raise
capital on terms acceptable to us, if at all, could have a material and adverse effect on our business and operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>A large number of our common shares
are issuable upon exercise of outstanding convertible securities which, if exercised or converted, would be dilutive to your holdings.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">As of June 30, 2017, there are outstanding
purchase options and warrants entitling the holders to purchase 2,942,284 common shares at a weighted average exercise price of
$4.60 per share. This includes 26,105 warrants that are conditional upon the exercise of other warrants. As of June 30, 2017,
there are 443,644 shares underlying promissory notes convertible into common stock at a weighted average exercise price of $3.00.
Additionally, as of June 30, 2017, we had reserved 507,375 shares of common stock for issuance under our restricted stock unit
program.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The exercise price for all of our outstanding
options and warrants, or the conversion price of our convertible notes, may be less than your cost to acquire our common shares.
In the event of the exercise or conversion of these securities, you could suffer substantial dilution of your investment in terms
of your percentage ownership in us as well as the book value of your common shares. In addition, the holders of the convertible
notes, common share purchase options or warrants may sell common shares in tandem with their exercise or conversion of those securities
to finance that exercise or conversion, or may resell the shares purchased in order to cover any income tax liabilities that may
arise from their exercise of the options or warrants or conversion of the notes.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Our issuance of additional common shares, or convertible
securities, would be dilutive to your holdings.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We are entitled under our Articles of Incorporation
to issue up to 30,000,000 shares of common stock. We have reserved for issuance 3,893,303 shares of common stock for existing
restricted stock units, options, warrants and convertible notes. As of June 30, 2017, we have issued and outstanding 8,869,571
shares of common stock. As a result, as of June 30, 2017 we had 17,237,126 common shares available for issuance to new investors
or for use to satisfy indebtedness or pay service providers.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our Board of Directors
may generally issue shares of common stock, restricted stock units or options or warrants to purchase those shares, without further
approval by our stockholders based upon such factors as our Board of Directors may deem relevant at that time. It is likely that
we will be required to issue a large amount of additional securities to raise capital to further our development. It is also likely
that we will be required to issue a large amount of additional securities to directors, officers, employees and consultants as
compensatory grants in connection with their services, both in the form of stand-alone grants or under our stock plans. We cannot
give you any assurance that we will not issue additional shares of common stock, or options or warrants to purchase those shares,
under circumstances we may deem appropriate at the time.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Our directors and officers own or control approximately
10.6% of our outstanding common shares which may limit your ability to propose new management or influence the overall direction
of the business; this concentration of control may also discourage potential takeovers that could otherwise provide a premium
to you.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">As of September 7,
2017, our officers and directors beneficially own or control approximately 10% of our outstanding common shares (assuming the
exercise of all outstanding options, restricted stock units and warrants held by our officers and directors). These persons will
have the ability to substantially influence all matters submitted to our stockholders for approval and to control our management
and affairs, including extraordinary transactions such as mergers and other changes of corporate control, and going private transactions.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.9pt"><B><I>Our issuance
of additional shares of common stock in satisfaction of services, or to repay indebtedness, would be dilutive to your holdings.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.9pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our Board of Directors may generally issue
shares of common stock to pay for debt or services, without further approval by our stockholders based upon such factors that
our Board of Directors may deem relevant at that time. For the past four fiscal years (ending March 31, 2017), we issued a total
of 1,193,300 shares for debt to reduce our obligations. In the fiscal year ended March 31, 2017 we issued 33,091 shares of common
stock at an average price discount of 13% weighted by the number of shares issued for debt in that period. We did not issue any
shares as payment for services in the fiscal year ended March 31, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">While we did not issue any shares as payment
for services in the fiscal years ended March 31, 2017 and 2016, it is likely that we will issue additional securities to pay for
services and to reduce debt in the future. We cannot give you any assurance that we will not issue additional shares of common
stock at various discounts under circumstances we may deem appropriate at the time.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: left">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Our officers and directors are entitled to indemnification
from us for liabilities under our articles of incorporation, which could be costly to us and may discourage the exercise of stockholder
rights.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our Articles of Incorporation contains
provisions which eliminate the liability of our directors for monetary damages to our company and stockholders. Our by-laws also
require us to indemnify our officers and directors. We may also have contractual indemnification obligations under our agreements
with our directors, officers and employees. The foregoing indemnification obligations could result in our company incurring substantial
expenditures to cover the cost of settlement or damage awards against directors, officers and employees that we may be unable
to recoup. These provisions and resultant costs may also discourage our company from bringing a lawsuit against directors, officers
and employees for breaches of their fiduciary duties, and may similarly discourage the filing of derivative litigation by our
stockholders against our directors, officers and employees even though such actions, if successful, might otherwise benefit our
company and stockholders.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Our by-laws and Nevada law may discourage, delay or prevent
a change of control of our company or changes in our management, would have the result of depressing the trading price of our
common stock.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Provisions of Nevada anti-takeover law
(NRS 78.378 <I>et seq.</I>) could have the effect of delaying or preventing a third-party from acquiring us, even if the acquisition
arguably could benefit our stockholders. Various provisions of our by-laws may delay, defer or prevent a tender offer or takeover
attempt of us that a stockholder might consider in his or her best interest. Our by-laws may be adopted, amended or repealed by
the affirmative vote of the holders of at least a majority of our outstanding shares of capital stock entitled to vote for the
election of directors, and except as provided by Nevada law, our Board of Directors shall have the power to adopt, amend or repeal
the bylaws by a vote of not less than a majority of our directors. The interests of these stockholders and directors may not be
consistent with your interests, and they may make changes to the by-laws that are not in line with your concerns.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our authorized but unissued shares of common
stock are available for our Board or Directors to issue without stockholder approval. We may use these additional shares for a
variety of corporate purposes, however, faced with an attempt to obtain control of us by means of a proxy context, tender offer,
merger or other transaction our Board of Directors acting alone and without approval of our stockholders can issue large amounts
of capital stock as part of a defense to a take-over challenge.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The existence of the foregoing provisions
and other potential anti-takeover measures could limit the price that investors might be willing to pay in the future for shares
of our common stock. They could also deter potential acquirers of our company, thereby reducing the likelihood that you could
receive a premium for your common stock in an acquisition.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>We incur substantial costs as a result of being a public
company and our management expects to devote substantial time to public company compliance programs.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">As a public company, we incur significant
legal, insurance, accounting and other expenses, including costs associated with public company reporting. We intend to invest
resources to comply with evolving laws, regulations and standards, and this investment will result in increased general and administrative
expenses and may divert management&rsquo;s time and attention from product development and commercialization activities. If our
efforts to comply with new laws, regulations and standards differ from the activities intended by regulatory or governing bodies
due to ambiguities related to practice, regulatory authorities may initiate legal proceedings against us, and our business may
be harmed. These laws and regulations could make it more difficult and costly for us to obtain director and officer liability
insurance for our directors and officers, and we may be required to accept reduced coverage or incur substantially higher costs
to obtain coverage. These factors could also make it more difficult for us to attract and retain qualified executive officers
and qualified members of our Board of Directors, particularly to serve on our audit and compensation committees. In addition,
if we are unable to continue to meet the legal, regulatory and other requirements related to being a public company, we may not
be able to maintain the quotation of our common stock on the Nasdaq Capital Market or on any other senior market to which we may
apply for listing, which would likely have a material adverse effect on the trading price of our common stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>If securities or industry analysts do not publish research
or reports about our business, or if they change their recommendations regarding our stock adversely, our stock price and trading
volume could decline.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The trading market for our common stock
will be influenced by the research and reports that industry or securities analysts publish about us or our business. Our research
coverage by industry and financial analysts is currently limited. Even if our analyst coverage increases, if one or more of the
analysts who cover us downgrade our stock, our stock price would likely decline. If one or more of these analysts cease coverage
of our company or fail to regularly publish reports on us, we could lose visibility in the financial markets, which in turn could
cause our stock price or trading volume to decline.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Risks Relating to this Offering</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>There is no minimum offering amount required to consummate
this offering.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">There is no minimum offering amount which
must be raised in order for us to consummate this offering. Accordingly, the amount of money raised may not be sufficient for
us to meet our business objectives. Moreover, if only a small amount of money is raised, all or substantially all of the offering
proceeds may be applied to cover the offering expenses and we will not otherwise benefit from the offering. In addition, because
there is no minimum offering amount required, investors will not be entitled to a return of their investment if we are unable
to raise sufficient proceeds to meet our business objectives.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in"> <B><I>The exclusive jurisdiction and waiver
of trial by jury clauses set forth in the form of securities purchase agreement and warrants to be issued to purchasers in this
offering may have the effect of limiting a purchaser&rsquo;s rights to bring legal action against us and could limit a purchaser&rsquo;s
ability to obtain a favorable judicial forum for disputes with us.</I></B> </P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in"> <B><I>&nbsp;</I></B> </P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in"> Section 5.9 of the securities purchase
agreement, which may be executed by purchasers of at least $500,000 of securities in this offering, provides for investors to
consent to exclusive jurisdiction to courts located in New York, New York and Section 5.21 provides for a waiver of the right
to a trial by jury.&nbsp;&nbsp; These provisions are also set forth in Section 5(e) of the warrants to be issued to purchasers
in this offering (forms of which have been filed as exhibits 4.29 and 4.31 of the Registration Statement on Form S-1 to which
this prospectus forms a part). These provisions may have the effect of limiting the ability of investors to bring a legal claim
against us due to geographic limitations and/or preference for a trial by jury and may limit an investor&rsquo;s ability to bring
a claim in a judicial forum that it finds favorable for disputes with us. Alternatively, if a court were to find this exclusive
forum provision inapplicable to, or unenforceable in respect of, one or more of the specified types of actions or proceedings,
we may incur additional costs associated with resolving such matters in other jurisdictions, which could adversely affect our
business and financial condition. </P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: left"><B><I>Management will
have broad discretion as to the use of the net proceeds from this offering, and we may not use these proceeds effectively.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have not designated any portion of the
net proceeds from this offering to be used for any particular purposes. Our management will have broad discretion in the application
of the net proceeds from this offering and could spend the proceeds in ways that do not improve our results of operations or enhance
the value of our common stock. Accordingly, you will be relying on the judgment of our management with regard to the use of these
net proceeds, and you will not have the opportunity, as part of your investment decision, to assess whether the proceeds are being
used appropriately. Our failure to apply these funds effectively could have a material adverse effect on our business, delay the
development of our product candidates and cause the price of our common stock to decline.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>You will experience immediate and substantial dilution
in the net tangible book value per share of the common stock you purchase.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Since the public offering price per share
of our common stock and related warrant being offered is expected to be substantially higher than the net tangible book value
per share of our common stock, you will suffer substantial dilution in the net tangible book value of the common stock you purchase
in this offering. Our net tangible book value as of June 30, 2017 was approximately $(1,033,000), or $(0.12) per share. After
giving effect to the assumed sale of shares of our common stock in this offering at an assumed combined public offering price
of $1.57 per share of common stock and related warrant (the closing bid price of our common stock on September 7, 2017), and after
deducting the estimated placement agent fees and estimated offering expenses payable by us, and attributing no value to the warrants
sold in this offering, if you purchase shares of our common stock in this offering, you will suffer immediate and substantial
dilution of $0.11 per share in the net tangible book value of the common stock you acquire. In the event that you exercise your
warrants, you will experience additional dilution to the extent that the exercise price of the warrants is higher than the tangible
book value per share of our common stock. See the section titled &ldquo;Dilution&rdquo; below for a more detailed discussion of
the dilution you would incur if you purchase shares of our common stock in this offering.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In addition, we have a significant number
of stock options, common stock underlying convertible notes, and warrants outstanding. To the extent that outstanding stock options
or warrants, including the warrants offered in this prospectus, have been or may be exercised or other shares issued, including
shares underlying convertible notes, you may experience further dilution.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Holders of our warrants will have no rights as a common
stockholder until they acquire our common stock.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Until you acquire shares of our common
stock upon exercise of your warrants, you will have no rights with respect to shares of our common stock issuable upon exercise
of your warrants. Upon exercise of your warrants, you will be entitled to exercise the rights of a common stockholder only as
to matters for which the record date occurs after the exercise date.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.9pt"><B><I>A large number of shares issued in
this offering may be sold in the market following this offering, which may depress the market price of our common stock.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.9pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">A large number of shares issued in this
offering may be sold in the market following this offering, which may depress the market price of our common stock. Sales of a
substantial number of shares of our common stock in the public market following this offering could cause the market price of
our common stock to decline. If there are more shares of common stock offered for sale than buyers are willing to purchase, then
the market price of our common stock may decline to a market price at which buyers are willing to purchase the offered shares
of common stock and sellers remain willing to sell the shares. All of the shares of common stock issued in the offering will be
freely tradable without restriction or further registration under the Securities Act of 1933.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>The warrants issued in this offering may not have any
value.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Each warrant will have an exercise price
equal to $__________ and will expire on the fifth anniversary of the date they first become exercisable. In the event our common
stock price does not exceed the exercise price of the warrants during the period when the warrants are exercisable, the warrants
may not have any value.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: left">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>If our common stock is not listed on a national securities
exchange, U.S. holders of the warrants may not be able to exercise their warrants without compliance with applicable state securities
laws and the value of your warrants may be significantly reduced.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">If our common stock is not approved for
listing on the NASDAQ Capital Market, or if our common stock is subsequently delisted from the NASDAQ Capital Market and is not
eligible to be listed on another national securities exchange, the exercise of the warrants by U.S. holders may not be exempt
from state securities laws. As a result, depending on the state of residence of a holder of the warrants, a U.S. holder may not
be able to exercise its warrants unless we comply with any state securities law requirements necessary to permit such exercise
or an exemption applies. Although we plan to use our reasonable efforts to assure that U.S. holders will be able to exercise their
warrants under applicable state securities laws if no exemption exists, there is no assurance that we will be able to do so. As
a result, in the event that our common stock is not approved for listing on the NASDAQ Capital Market or our common stock is delisted
from the NASDAQ Capital Market and is not eligible to be listed on another securities exchange, your ability to exercise your
warrants may be limited. The value of the warrants may be significantly reduced if U.S. holders are not able to exercise their
warrants under applicable state securities laws.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt"><B><I>There is no public
market for the common warrants or the pre-funded warrants to purchase shares of our common stock included in the units and the
pre-funded units&nbsp;being offered by us in this offering.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in; background-color: white">There is no established
public trading market for the common warrants or the pre-funded warrants included in the units and the pre-funded units being
offered in this offering, and we do not expect a market to develop. In addition, we do not intend to apply to list the common
warrants or the pre-funded warrants on any national securities exchange or other nationally recognized trading system, including
The NASDAQ Capital Market. Without an active market, the liquidity of the common warrants and the pre-funded warrants will be
limited.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><A NAME="a4"></A><B>SPECIAL NOTE REGARDING
FORWARD-LOOKING STATEMENTS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">This prospectus contains forward-looking
statements that are based on our management&rsquo;s beliefs and assumptions and on information currently available to us. The
forward-looking statements are contained principally in, but not limited to, the sections entitled &ldquo;Prospectus Summary,&rdquo;
&ldquo;Risk Factors,&rdquo; &ldquo;Management&rsquo;s Discussion and Analysis of Financial Condition and Results of Operations&rdquo;
and &ldquo;Business.&rdquo; These statements relate to future events or to our future financial performance and involve known
and unknown risks, uncertainties, and other factors that may cause our or our industry&rsquo;s actual results, levels of activity,
performance or achievements to be materially different from any future results, levels of activity, performance or achievements
expressed or implied by these forward-looking statements. Forward-looking statements include, but are not limited to, statements
about:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>Our ability
                                         to continue as a going concern;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>our ability
                                         to achieve sufficient market acceptance of any of our products or product candidates;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>our perception
                                         of the growth in the size of the potential market for our products and product candidates;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>our estimate
                                         of the advantages of our products;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>our ability
                                         to become a profitable company;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>our estimates
                                         regarding our needs for additional financing and our ability to obtain such additional
                                         financing on suitable terms;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>our ability
                                         to succeed in obtaining FDA clearance or approvals for our product candidates;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>the timing,
                                         costs and other limitations involved in obtaining regulatory clearance or approval for
                                         any of our product candidates and, thereafter, continued compliance with governmental
                                         regulation of our existing products and activities;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>our ability
                                         to protect our intellectual property and operate our business without infringing upon
                                         the intellectual property rights of others;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>our ability
                                         to obtain sufficient quantities and satisfactory quality of raw materials to meet our
                                         manufacturing needs;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>our ability
                                         to secure manufacturing capacity to meet future demand;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>the timing
                                         of and our ability to conduct clinical trials;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>our ability
                                         to perform under our government contracts and accurately estimate our fixed costs under
                                         such contracts;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>our ability
                                         to attract and retain a qualified management team, research team, scientific advisors
                                         and other qualified personnel; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>our liquidity.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In some cases, you can identify forward-looking
statements by terms such as &ldquo;may,&rdquo; &ldquo;could,&rdquo; &ldquo;will,&rdquo; &ldquo;should,&rdquo; &ldquo;would,&rdquo;
&ldquo;expect,&rdquo; &ldquo;plan,&rdquo; &ldquo;intend,&rdquo; &ldquo;anticipate,&rdquo; &ldquo;believe,&rdquo; &ldquo;estimate,&rdquo;
&ldquo;predict,&rdquo; &ldquo;potential,&rdquo; &ldquo;project&rdquo; or &ldquo;continue&rdquo; or the negative of these terms
or other comparable terminology. These statements are only predictions. You should not place undue reliance on forward-looking
statements because they involve known and unknown risks, uncertainties and other factors, which are, in some cases, beyond our
control and which could materially affect results. Factors that may cause actual results to differ materially from current expectations
include, among other things, those listed under the heading &ldquo;Risk Factors&rdquo; and elsewhere in this prospectus. If one
or more of these risks or uncertainties occur, or if our underlying assumptions prove to be incorrect, actual events or results
may vary significantly from those implied or projected by the forward-looking statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Any forward-looking statement in this prospectus
reflects our current views with respect to future events and is subject to these and other risks, uncertainties and assumptions
relating to our operations, results of operations, industry and future growth. Except as required by law, we assume no obligation
to publicly update or revise any forward-looking statements contained in this prospectus, whether as a result of new information,
future events or otherwise. The Private Securities Litigation Reform Act of 1995 and Section 27A of the Securities Act of 1933
do not protect any forward-looking statements that we make in connection with this offering.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><A NAME="a5"></A><B>USE OF PROCEEDS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><FONT STYLE="background-color: white">We
estimate the net proceeds from this offering will be approximately $6.8 million, from the sale of our securities in this offering,
based on an assumed offering price of $1.57 per unit and assuming the sale of 4,777,070 units&nbsp;and no sale of any pre-funded
units in this offering, after deducting estimated placement agent&rsquo;s fees and expenses and our estimated offering expenses.
We do not intend to pay any proceeds of this offering to any of our affiliates. The public offering price per unit and pre-funded
unit will be determined between us and the placement agent based on market conditions at the time of pricing, and may be at a
discount to the current market price of our common stock. This estimate excludes the proceeds, if any, from the exercise of common
warrants in this offering. If all of the common warrants sold in this offering were to be exercised in cash at an assumed exercise
price of $1.96 per share, we would receive additional net proceeds of approximately $7.0 million. We cannot predict when or if
these common warrants will be exercised. It is possible that these common warrants may expire and may never be exercised. </FONT>A
$1.00 increase (decrease) in the assumed combined public offering price of $1.57 per share of our common stock would increase
(decrease) the expected net cash proceeds of this offering to us by approximately $4.4/$(4.4) million assuming the number of shares
and warrants remains the same. An increase (decrease) of 1,000,000 in the assumed number of shares sold in this offering would
increase (decrease) the expected net cash proceeds of the offering to us by approximately $1.5/$(1.5) million, assuming a combined
public offering price of $1.57 per share. We intend to use the net proceeds of this offering to continue the clinical development
of our product candidates and for working capital and other general corporate purposes. We cannot state with specificity the amount
of funds raised which will be utilized for clinical development. The cost of completing an efficacy trial for our device is almost
entirely a function of the number of patients and sites the FDA decides is necessary for our device. We do not expect to receive
that guidance from the FDA for a number of months. Should the FDA decide to approve our device for certain highly virulent viruses
for which clinical trials cannot be conducted, then we will not incur clinical trial costs related to those indications.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Pending these uses, we intend to invest
the net proceeds of this offering primarily in investment grade, interest-bearing instruments. As of the date of this prospectus,
we cannot specify with certainty all of the particular uses for the net proceeds we will have upon completion of the offering.
Accordingly, we will retain broad discretion over the use of these proceeds.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> If our gross proceeds from
this offering is less than $6 million, we will need to raise additional capital from other sources.The securities
purchase agreement being entered into with certain purchasers in this offering limit our ability to raise capital both (i)
for 90 days whatsoever, and (ii) for so long as warrants issued hereunder are outstanding, in any sort of variable priced
financing. Even without receipt of proceeds from this offering, we have sufficient cash to operate for the next 90 days, and
we do not intend to enter into any sort of variable priced financing in the future due to the highly dilutive nature of those
financings. Because we do not intend to enter into any variable priced financings, we would not forsee a need for a forward
or reverse split of our stock in the next 12 months. </P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>




<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><A NAME="a6"></A><B>MARKET PRICE FOR COMMON
EQUITY AND RELATED STOCKHOLDER MATTERS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our common stock is listed on the Nasdaq
Capital Market under the trading symbol &quot;AEMD.&quot; Trading in our common stock historically has been volatile and often
has been thin. On July 7, 2015, The NASDAQ Stock Market LLC approved our application for listing our common stock on the Nasdaq
Capital Market under the symbol &ldquo;AEMD,&rdquo; and we commenced trading on the Nasdaq Capital Market on July 13, 2015. Previously,
our common stock was quoted on the OTCQB Marketplace under the trading symbol &ldquo;AEMD.&rdquo;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The following table sets forth for the
calendar periods indicated the quarterly high and low closing or bid prices, as applicable, for our common stock as reported by
the Nasdaq Capital Market and/or the OTCQB Marketplace. The prices represent quotations between dealers, without adjustment for
retail markup, mark down or commission, and do not necessarily represent actual transactions.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="text-align: center; border-bottom: Black 1pt solid">CLOSING/BID PRICE</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">PERIOD</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">HIGH</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">LOW</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>Calendar 2017:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 66%; text-align: left">First Quarter</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">4.75</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">3.19</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>Calendar 2016:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">Fourth Quarter</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5.14</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4.11</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Third Quarter</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7.70</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4.77</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">Second Quarter</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6.14</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4.70</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">First Quarter</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7.01</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4.34</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>Calendar 2015:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">Fourth Quarter</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8.20</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6.17</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Third Quarter</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">11.38</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6.58</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">Second Quarter</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">14.00</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6.51</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">First Quarter</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">19.50</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8.50</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">There were approximately 84 record holders
of our common stock at September 7, 2017. The number of registered stockholders includes any beneficial owners of common shares
held in street name.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On April 14, 2015, we completed a 1-for-50
reverse stock split. Accordingly, authorized common stock was reduced from 500,000,000 shares to 10,000,000 shares, and each 50
shares of outstanding common stock held by stockholders were combined into one share of common stock. The accompanying consolidated
financial statements and accompanying notes have been retroactively revised to reflect such reverse stock split as if it had occurred
on April 1, 2014. All shares and per share amounts have been revised accordingly.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The transfer agent and registrar for our
common stock is Computershare Investor Services, located at 350 Indiana Street, Suite 800, Golden, Colorado 80401.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: center; margin-bottom: 0pt">EQUITY COMPENSATION
PLANS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: center; margin-bottom: 0pt">SUMMARY EQUITY COMPENSATION
PLAN DATA</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><A NAME="a7"></A><B>Equity Compensation Plans</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Summary equity compensation plan data</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The following table sets forth information,
as of June 30, 2017, about our equity compensation plans (including the potential effect of debt instruments convertible into
common stock) in effect as of that date:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">Plan category</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">(a) <BR> Number of <BR> securities <BR> to be issued
    <BR> upon exercise <BR> of outstanding <BR> options, warrants <BR> and rights <BR> (1)(2)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">(b) <BR> Weighted-average <BR> exercise price of
    <BR> outstanding options</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">(c) <BR> Number of <BR> securities <BR> remaining
    <BR> available <BR> for future issuance <BR> under equity <BR> compensation <BR> plans <BR> (excluding <BR> securities <BR>
    reflected in column <BR> (a))</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 49%; text-align: left">Equity compensation plans approved by security holders (3)(5)</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 13%; text-align: right">787,296</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">&ndash;</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 13%; text-align: right">2,212,704</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Equity compensation plans not approved by security holders (1)(3)(4)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">466,547</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">$</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">10.30</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">28,845</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-bottom: 2.5pt">Totals</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">1,253,843</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 2.5pt double">$</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">10.30</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">2,241,549</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">_______________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">(1)<FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;
</FONT>The description of the material terms of non-plan issuances of equity instruments is discussed in Note 5 to the accompanying
consolidated financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">(2)<FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;
</FONT>Net of equity instruments forfeited, exercised or expired.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">(3)<FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;
</FONT>Includes restricted 787,296 restricted stock unit grants to our officers and directors in August 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">(4)<FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;
</FONT> On June 30, 2017 we had 2,241,549 shares available under our 2010 Stock Incentive Plan.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">(5)<FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;
</FONT>3,000,000 share increase to the 2010 Stock Incentive Plan approved by shareholders.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in"><B><I>2000 Stock Option Plan</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our 2000 Stock Option Plan provides for
the grant of incentive stock options to our full-time employees (who may also be directors) and nonstatutory stock options to
non-employee directors, consultants, customers, vendors or providers of significant services. The exercise price of any incentive
stock option may not be less than the fair market value of the common stock on the date of grant or, in the case of an optionee
who owns more than 10% of the total combined voting power of all classes of our outstanding stock, not be less than 110% of the
fair market value on the date of grant. The exercise price, in the case of any nonstatutory stock option, must not be less than
75% of the fair market value of the common stock on the date of grant. The amount reserved under the 2000 Stock Option Plan is
10,000 options.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">At June 30, 2017, all of the grants previously
made under the 2000 Stock Option Plan had expired and 200 common shares had been issued under the plan, with 9,800 available for
future issuance.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>2010 Stock Incentive Plan</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In August 2010, we adopted the 2010 Stock
Incentive Plan, which provides incentives to attract, retain and motivate employees and directors whose present and potential
contributions are important to our success by offering them an opportunity to participate in our future performance through awards
of options, the right to purchase common stock, stock bonuses and stock appreciation rights and other awards. We initially reserved
a total of 70,000 common shares for issuance under the 2010 Stock Incentive Plan.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In August 2010, we filed a registration
statement on Form S-8 for the purpose of registering 70,000 common shares issuable under this plan under the Securities Act, and
in July 2012, we filed a registration statement on Form S-8 for the purpose of registering 100,000 common shares issuable under
this plan under the Securities Act.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On January 26, 2016, our Board of Directors
approved an amendment to the 2010 Stock Incentive Plan to increase the total number of shares of common stock reserved for issuance
under the plan to 3,170,000 shares, subject to amendment of our Articles of Incorporation to increase our authorized common stock.
On March 29, 2016, we held an annual stockholders meeting, at which our stockholders approved the Amended 2010 Stock Incentive
Plan and an amendment of our Articles of Incorporation to increase our authorized common stock to 30,000,000 shares. On March
31, 2016, we filed a Certificate of Amendment to our Articles of Incorporation to effect the increase in our authorized common
stock. As a result of such amendment, the Amended 2010 Stock Incentive Plan became effective on March 31, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">At June 30, 2017, we had 2,212,704 shares
available under this plan.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt"><B><I>2012 Directors
Compensation Program</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In July 2012, our Board of Directors approved
a board compensation program that modified and superseded the 2005 Directors Compensation Program, which was previously in effect.
Under the 2012 program, in which only non-employee directors may participate, an eligible director will receive a grant of $35,000
worth of ten-year options to acquire shares of common stock, with such grant being valued at the exercise price based on the average
of the closing bid prices of the common stock for the five trading days preceding the first day of the fiscal year. In addition,
under this program, eligible directors will receive cash compensation equal to $500 for each committee meeting attended and $1,000
for each formal board meeting attended.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">At March 31, 2017, we had issued 26,757
options under the 2005 program to outside directors and 79,309 options to employee-directors, 21,756 outside directors&rsquo;
options had been forfeited, 5,000 outside directors&rsquo; options had been exercised, 79,309 employee-directors&rsquo; options
had been forfeited and no options under the 2005 program remained outstanding. There were no issuances of stock options to our
outside directors in the fiscal years ended March 31, 2016 and 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On June 6, 2014, our Board of Directors
approved certain changes to the 2012 program. Under this modified program, a new eligible director will receive an initial grant
of $50,000 worth of options to acquire shares of common stock, with such grant being valued at the exercise price based on the
average of the closing bid prices of the common stock for the five trading days preceding the first day of the fiscal year. These
options will have a term of ten years and will vest 1/3 upon grant and 1/3 upon each of the first two anniversaries of the date
of grant. In addition, at the beginning of each fiscal year, each existing director eligible to participate in the modified 2012
program also will receive a grant of $35,000 worth of options valued at the exercise price based on the average of the closing
bid prices of the common stock for the five trading days preceding the first day of the fiscal year. Such options will vest on
the first anniversary of the date of grant. In lieu of per meeting fees, eligible directors will receive an annual board retainer
fee of $30,000. The modified 2012 program also provides for the following annual retainer fees: Audit Committee Chair - $5,000,
Compensation Committee chair - $5,000, Nominating Committee Chair - $5,000, Audit Committee member - $4,000, Compensation Committee
member - $4,000, Nominating Committee member $4,000 and lead independent director - $15,000.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On August 9, 2016, the Board approved further
modifications to the program. Under the modified 2012 Program, in which only non-employee directors may participate, a new eligible
director will receive an initial grant of $50,000 worth of RSUs or, at the discretion of the Board, options to acquire shares
of Common Stock. RSUs granted under this provision will be valued based on the average of the closing prices of the Common Stock
for the five trading days preceding and including the date of grant and will vest at a rate determined by the Board in its discretion.
Options granted under this provision will be valued at the exercise price, which will be based on the average of the closing prices
of the Common Stock for the five trading days preceding and including the date of grant. Such options will have a term of ten
years and will vest at a rate determined by the Board in its discretion.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">At the beginning of each fiscal year, each
existing director eligible to participate in the 2012 Program will receive a grant of $35,000 worth of RSUs or, at the discretion
of the Board, options to acquire shares of Common Stock. RSUs granted under this provision will be valued based on the average
of the closing prices of the Common Stock for the five trading days preceding and including the first day of the fiscal year (or
preceding and including the date of grant, if such grant is not made on the first day of the fiscal year) and will vest at a rate
determined by the Board in its discretion. Options granted under this provision will be valued at the exercise price, which will
be based on the average of the closing prices of the Common Stock for the five trading days preceding and including the first
day of the fiscal year (or preceding and including the date of grant, if such grant is not made on the first day of the fiscal
year). Such options will have a term of ten years and will vest at a rate determined by the Board in its discretion.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The RSU grants and the changes to the 2012
Program were approved and recommended by our Compensation Committee prior to approval by the Board.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Stand-alone grants</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">From time to time our Board of Directors
grants common stock or common share purchase options or warrants to selected directors, officers, employees and consultants as
equity compensation to such persons on a stand-alone basis outside of any of our formal stock plans. The terms of these grants
are individually negotiated. There were no stock option grants to either employees or directors during the fiscal years ended
March 31, 2017 and March 31, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><A NAME="a8"></A><B>CAPITALIZATION</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The following table sets forth our cash
and cash equivalents and our capitalization as of June 30, 2017:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>on an
                                         actual basis; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>on an
                                         as adjusted basis, based upon an assumed offering price of $1.57 per share of common
                                         stock and corresponding warrant, to give effect to the sale of 4,777,070 shares of common
                                         stock in this offering, after deducting the estimated placement agent discounts and commissions
                                         and estimated offering expenses payable by us.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Based on the assumed offering price of
$1.57 per share and associated warrant. The as adjusted information below is only for illustrative purposes and our capitalization
following the completion of this offering will be adjusted based on the actual offering price and other terms of this offering
determined at pricing. You should read this table in conjunction with &ldquo;Use of Proceeds&rdquo; above as well as our &ldquo;Management&rsquo;s
Discussion and Analysis of Financial Condition and Results of Operations&rdquo; and financial statements and the related notes
appearing elsewhere in this prospectus.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold; padding-bottom: 1pt"></TD><TD STYLE="padding-bottom: 1pt"><B>&nbsp;</B></TD>
    <TD COLSPAN="6" STYLE="text-align: center; border-bottom: Black 1pt solid"><B>June 30, 2017</B></TD><TD STYLE="text-align: center; padding-bottom: 1pt"><B>&nbsp;</B></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: center"><B>&nbsp;</B></TD><TD STYLE="font-weight: bold; text-align: center"><B>&nbsp;</B></TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center"><B>Unaudited</B></TD><TD STYLE="font-weight: bold; text-align: center"><B>&nbsp;</B></TD><TD STYLE="font-weight: bold; text-align: center"><B>&nbsp;</B></TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center"><B>Unaudited</B></TD><TD STYLE="font-weight: bold; text-align: center"><B>&nbsp;</B></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold; text-align: center; padding-bottom: 1pt"></TD><TD STYLE="font-weight: bold; text-align: center; padding-bottom: 1pt"><B>&nbsp;</B></TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><B>Actual</B></TD><TD STYLE="font-weight: bold; text-align: center; padding-bottom: 1pt"><B>&nbsp;</B></TD><TD STYLE="text-align: center; padding-bottom: 1pt"><B>&nbsp;</B></TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid"><B>As Adjusted</B></TD><TD STYLE="text-align: center; padding-bottom: 1pt"><B>&nbsp;</B></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: center"><B>&nbsp;</B></TD><TD STYLE="text-align: center"><B>&nbsp;</B></TD>
    <TD COLSPAN="6" STYLE="text-align: center"><B>(in thousands except share amounts)</B></TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="font-weight: bold">Assets:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 66%; text-align: left">Cash &amp; Cash Equivalents</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">327,206</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">7,052,206</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="font-weight: bold">Liabilities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="font-weight: bold; text-align: left; padding-bottom: 1pt">Total Liabilities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">1,459,216</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">1,459,216</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="font-weight: bold; text-align: left">Stockholders&rsquo; Equity:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>Common Stock, par value of $0.001</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">8,869</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">13,647</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">Additional Paid-in-capital</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">94,745,740</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">101,465,363</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Retained Earnings (Deficit)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">(95,619,939</TD><TD STYLE="text-align: left; padding-bottom: 1pt">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">(95,619,939</TD><TD STYLE="text-align: left; padding-bottom: 1pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Total Stockholders&rsquo; Equity Before Noncontrolling Interests</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 2.5pt double">$</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">(865,330</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 2.5pt double">$</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">5,859,071</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD></TR>
</TABLE>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The total number of shares of our common
stock outstanding in the table above is based on 8,869,571 shares outstanding as of June 30, 2017, and excludes as of that date,
the following:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.45in">(1)</TD><TD>The number of shares of our common stock outstanding prior
                                         to and to be outstanding immediately after this offering, as set forth in the above table,
                                         is based on 8,869,571 shares of our common stock outstanding as of June 30, 2017 and
                                         excludes as of that date:</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>466,547
                                         shares of common stock issuable upon exercise of outstanding stock options under our
                                         stock incentive plans at a weighted average exercise price of $10.30 per share;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">2,475,737
                                         additional shares of common stock reserved for issuance under outstanding warrants with
                                         a weighted average exercise price of $3.53 per share;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">507,375
                                         additional shares of common stock reserved for future issuance under our stock incentive
                                         plans;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">443,644
                                         additional shares of common stock issuable under convertible notes, which includes accrued
                                         interest through June 30, 2017;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">shares
                                         of common stock issuable upon exercise of the warrants offered hereby; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">shares
                                         of common stock issuable upon exercise of warrants to be issued to the placement agent
                                         in connection with this offering.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 6pt"><P STYLE="margin: 0pt">&nbsp;</P></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">A $1.00 increase (decrease) in the offering
price of <U>$</U>1.57 per share of common stock would increase (decrease) cash and cash equivalents and total stockholders&rsquo;
equity by $4,442,675 million, assuming that the number of shares offered by us, as set forth on the cover page of this prospectus,
remains the same, and after deducting the estimated placement agent fee and estimated offering expenses payable by us.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><A NAME="a9"></A><B>DIVIDEND POLICY</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have not paid any dividends on our common
stock to date and do not anticipate that we will pay dividends in the foreseeable future. Any payment of cash dividends on our
common stock in the future will be dependent upon the amount of funds legally available, our earnings, if any, our financial condition,
our anticipated capital requirements and other factors that the board of directors may think are relevant. However, we currently
intend for the foreseeable future to follow a policy of retaining all of our earnings, if any, to finance the development and
expansion of our business and, therefore, do not expect to pay any dividends on our common stock in the foreseeable future.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><A NAME="a10"></A><B>DILUTION</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">If you purchase shares of our securities
in this offering, you will experience dilution to the extent of the difference between the price per share you pay in this offering
and the net tangible book value per share of our common stock immediately after this offering, assuming no value is attributed
to the warrants and such warrants are accounted for and classified as equity. Our net tangible book value as of June 30, 2017
was approximately $(1,033,000), or approximately $(0.12) per share. Net tangible book value per share represents our total tangible
assets less total tangible liabilities, divided by the number of shares of common stock outstanding as of June 30, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">After giving effect to the assumed sale
by us of 4,777,070 shares of our common stock and warrants to purchase 4,777,070 shares of our common stock in this offering at
an assumed combined public offering price of $1.57 per share of our common stock and related warrant (the closing bid price of
our common stock on September 7, 2017), and after deducting the estimated placement agent fees and estimated offering expenses
payable by us, our as adjusted net tangible book value as of June 30, 2017 would have been approximately $5.7 million, or approximately
$0.42 per share of common stock. This represents an immediate increase in net tangible book value of approximately $0.50 per share
to existing shareholders and an immediate dilution of approximately $1.15 per share to new investors, attributing none of the
assumed combined public offering price to the warrants offered hereby. The following table illustrates this per share dilution:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 66%; text-align: left">Assumed combined public offering price per share and related warrant</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 13%; text-align: right">&nbsp;</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%">$</TD>
    <TD STYLE="width: 13%; text-align: right">1.57</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    </TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>Net tangible book value per share as of June 30, 2017</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">(0.12</TD><TD STYLE="text-align: left">)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Increase in net tangible book value per share attributable to new investors</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">0.50</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">As adjusted net tangible book value per share as of June 30, 2017, after
    giving effect to this offering</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">$</TD>
    <TD STYLE="text-align: right; border-bottom: Black 1pt solid">0.42</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    </TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Dilution per share to new investors in the offering</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double">$</TD>
    <TD STYLE="text-align: right; border-bottom: Black 2.5pt double">1.15</TD>
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    </TR>
</TABLE>






<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Each $1.00 increase (decrease) in the assumed
combined public offering price of $1.57 per share and related warrant would increase (decrease) our as adjusted net tangible book
value after this offering by $1.5/$(1.5) million, or $0.11/$(0.11) per share, and the dilution per share to new investors by $2.05/$0.26
per share, assuming that the number of shares of common stock and related warrants offered by us, as set forth above, remains
the same and after deducting the estimated placement agent fees and estimated offering expenses payable by us. We may also increase
or decrease the number of shares of common stock and related warrants we are offering from the assumed number of shares of common
stock and related warrants set forth above. An increase (decrease) of 1,000,000 shares of common stock and related warrants in
the number of shares of common stock and related warrants offered by us from the assumed number of shares of common stock and
related warrants set forth above at an assumed combined public offering price of $1.57 (the closing bid price of our common stock
on September 7, 2017) would increase (decrease) our as adjusted net tangible book value after this offering by $1.5/$(1.5) million,
or $0.52/$0.31 per share, and the dilution per share to new investors by $1.05/$1.26 per share, assuming that the assumed public
offering price remains the same and after deducting the placement agent fees and estimated offering expenses payable by us. The
information discussed above is illustrative only and will adjust based on the actual combined public offering price, the actual
number of shares and warrants that we offer in this offering, and other terms of this offering determined at pricing.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">This table does not take into account further
dilution to new investors that could occur upon the exercise of outstanding options and warrants, including the warrants offered
in this offering, having a per share exercise price less than the public offering price per share in this offering.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">(1)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The number of
shares of our common stock outstanding prior to and to be outstanding immediately after this offering, as set forth in the above
table, is based on 8,951,081 shares of our common stock outstanding as of September 7, 2017 and excludes as of that date:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>466,547
                                         shares of common stock issuable upon exercise of outstanding stock options under our
                                         stock incentive plans at a weighted average exercise price of $10.30 per share;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>2,464,739
                                         additional shares of common stock reserved for issuance under outstanding warrants with
                                         a weighted average exercise price of $3.48 per share;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>507,375
                                         additional shares of common stock reserved for future issuance under our stock incentive
                                         plans;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>451,786
                                         additional shares of common stock issuable under convertible notes, which includes accrued
                                         interest through September 8, 2017;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>shares
                                         of common stock issuable upon exercise of the warrants offered hereby; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>shares
                                         of common stock issuable upon exercise of warrants to be issued to the placement agent
                                         in connection with this offering.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"></P>

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<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>




<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><A NAME="a11"></A><B>MANAGEMENT&rsquo;S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The following discussion and analysis should
be read in conjunction with the consolidated Financial Statements and Notes thereto appearing elsewhere in this registration statement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Overview </B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Company Overview</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We are a medical technology company focused
on addressing unmet needs in global health and biodefense. The Aethlon Hemopurifier&reg; is an early clinical-stage therapeutic
device designed for the single-use removal of life-threatening viruses from the circulatory system of infected individuals. We
believe the Hemopurifier&reg; can be a part of the broad-spectrum treatment of life-threatening highly glycosylated viruses that
are not addressed with an already approved treatment countermeasure objectives set forth by the U.S. Government to protect citizens
from bioterror and pandemic threats. In small-scale or early feasibility human studies, the Hemopurifier&reg; has been administered
to HIV, Hepatitis-C, and Ebola infected individuals. Additionally, the Hemopurifier&reg; has also been validated to capture Zika
virus, Lassa virus, MERS-CoV, Cytomegalovirus, Epstein-Barr virus, Herpes Simplex virus, Chikungunya virus, Dengue virus, West
Nile virus, Smallpox-related viruses, H1N1 Swine Flu virus, H5N1 Bird Flu virus, and the reconstructed Spanish flu virus of 1918.
In several cases, these validations were conducted in collaboration with leading government or non-government research institutes.
In the United States, we are focused on the clinical advancement of the Hemopurifier&reg; through investigational device exemptions
(IDEs) approved by FDA. We recently concluded a feasibility study to demonstrate the safety of our device in health-compromised
individuals infected with a viral pathogen. We are also the majority owner of Exosome Sciences, Inc. (ESI), a company focused
on the discovery of exosomal biomarkers to diagnose and monitor life-threatening diseases. Included among ESI&rsquo;s endeavors
is the advancement of a TauSomeTM biomarker candidate to diagnose Chronic Traumatic Encephalopathy (CTE) in the living. ESI previously
documented that TauSome levels in former NFL players to be 9x higher than same age-group control subjects.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">On March 10, 1999, Aethlon, Inc., a California corporation,
Hemex, Inc., a Delaware corporation and the accounting predecessor to Aethlon, Inc., and Bishop, Inc., a publicly-traded company,
completed an Agreement and Plan of Reorganization structured to result in Bishop, Inc.'s acquisition of all of the outstanding
common shares of Aethlon, Inc. and Hemex, Inc. Under the plan's terms, Bishop, Inc. issued shares of its common stock to the stockholders
of Aethlon, Inc. and Hemex, Inc. such that Bishop, Inc. then owned 100% of each company. Upon completion of the transaction, Bishop,
Inc. was renamed Aethlon Medical, Inc. Our executive offices are located at 9635 Granite Ridge Drive, Suite 100, San Diego, California
92123. Our telephone number is (858) 459-7800. Our website address is <FONT STYLE="color: blue">www.aethlonmedical.com</FONT>.
Our website and the information contained on our website are not incorporated into this prospectus or the registration statement
of which it forms a part.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left"><B>For the Fiscal Years Ended March 31, 2017
and 2016</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Results of Operations</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Revenues</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We recorded government contract revenue
in the fiscal years ended March 31, 2017 and 2016. This revenue arose from work performed under our government contract with the
Defense Advanced Research Projects Agency, or DARPA, and our subcontract with Battelle Memorial Institute, or Battelle (both of
which are now completed), as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">Fiscal Year</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">Fiscal year</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">Ended</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">Ended</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">Change in</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">3/31/17</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">3/31/16</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Dollars</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 55%; text-align: left">DARPA contract</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 11%; text-align: right">387,438</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 11%; text-align: right">863,011</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 11%; text-align: right">(475,573</TD><TD STYLE="width: 1%; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Battelle subcontract</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">4,635</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">23,561</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(18,926</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Total government contract revenue</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">392,073</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">886,572</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(494,499</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD></TR>
</TABLE>




<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><I>DARPA Contract</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We entered into a contract with DARPA on
September 30, 2011. Under the DARPA award, we were engaged to develop a therapeutic device to reduce the incidence of sepsis,
a fatal bloodstream infection that often results in the death of combat-injured soldiers. The award from DARPA was a fixed-price
contract with potential total payments to us of $6,794,389 over the course of five years. Fixed price contracts require the achievement
of multiple, incremental milestones to receive the full award during each year of the contract. Under the terms of the contract,
we performed certain incremental work towards the achievement of specific milestones against which we invoiced the government
for fixed payment amounts.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Originally, only the base year (year one
of the contract) was effective for the parties; however, DARPA subsequently exercised its option on the remaining years of the
contract. The milestones were comprised of planning, engineering and clinical targets, the achievement of which in some cases
required the participation and contribution of third-party participants under the contract. We commenced work under the contract
in October 2011 and completed the contract in September 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In February 2014, DARPA reduced the scope
of our contract in years three through five of the contract. The reduction in scope focused our research on exosomes, viruses
and blood processing instrumentation. This scope reduction reduced the possible payments under the contract by $858,469 over years
three through five.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In the fiscal year ended March 31, 2017,
we invoiced the U.S. Government for the final two milestones under our DARPA contract in the aggregate amount of $387,438. In
the fiscal year ended March 31, 2016, we invoiced the U.S. Government for four milestones under our DARPA contract in the amount
of $863,011.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><I>Battelle Subcontract</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We entered into a subcontract agreement
with Battelle in March 2013. Battelle was chosen by DARPA to be the prime contractor on the systems integration portion of the
original DARPA contract, and we are one of several subcontractors on that systems integration project. The Battelle subcontract
is under a time and materials basis and we began generating revenues under the subcontract in the three months ended September
30, 2013. That contract has now concluded. The Battelle subcontract was our first cost-reimbursable contract.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our revenue under this contract was a function
of cost reimbursement plus an overhead mark-up for hours devoted to the project by specific employees (with specific hourly rates
for those employees), for travel expenses related to the project, for any equipment purchased for the project and for the cost
of any consultants hired by us to perform work on the project. Each payment required approval by the program manager at Battelle.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Operating Expenses</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Consolidated operating expenses were $6,490,430
for the fiscal year ended March 31, 2017 compared to $5,271,406 in the fiscal year ended March 31, 2016, an increase of $1,219,024.
The net increase of $1,219,024 was due to increases in payroll and related expenses of $1,396,050, which was partially offset
by a decrease in professional fees of $97,504 and a decrease in general and administrative expense of $79,522.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The $1,396,050 increase in payroll and
related expenses was principally driven by a $1,983,465 increase in our stock-based compensation due to the vesting of restricted
stock units granted during the fiscal year, which was partially offset by a $371,041 decrease in cash payroll and related expenses
of Aethlon Medical due primarily to reductions in headcount and in bonus payments and by a $216,374 decrease in the payroll and
related expenses of Exosome due to headcount reductions.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The $97,504 decrease in our professional
fees arose from a $97,316 decrease in DARPA-related professional fees coupled with a decrease in our non-DARPA-related professional
fees of $6,230, which were partially offset by an increase in Exosome&rsquo;s professional fees of $6,042. The primary factor
in our $97,316 decrease in our DARPA-related professional fees was the completion of our DARPA contract in September 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The $79,522 decrease in general and administrative
expenses primarily arose from a decrease in the general and administrative expenses at Exosome of $68,036 and a decrease in our
non-DARPA-related activities of $29,823. Those decreases were partially offset by an increase in the general and administrative
expenses in our DARPA-related activities of $18,337.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Other Expense</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In the fiscal year ended March 31, 2017,
we recognized other expenses of $1,208,369 compared to $573,782 of other expense in the fiscal year ended March 31, 2016. The
following table breaks out the various components of our other expense over the fiscal years ended March 31, 2017 and 2016:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>



<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="10" STYLE="text-align: center; border-bottom: Black 1pt solid">Components of Other Expense in Fiscal Year Ended</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">March 31, <BR>2017</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">March 31, <BR>2016</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Change</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 55%; text-align: left; padding-left: 0.5pt">Loss on debt extinguishment</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 11%; text-align: right">558,198</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 11%; text-align: right">&ndash;</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 11%; text-align: right">558,198</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.5pt">Interest and other debt expenses</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">304,330</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">573,782</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(269,452</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 0.5pt">Warrant repricing expense</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">345,841</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">345,841</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 0.5pt">Total other expense</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">1,208,369</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">573,782</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">634,587</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>


<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="margin: 0"></P>

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<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="text-align: left; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt">Loss on Debt Extinguishment</P>





<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our aggregate loss on debt extinguishment
for the fiscal year ended March 31, 2017 arose from a $616,889 loss associated with the June 2016 amendments to our November 2014
convertible notes coupled with a gain on debt extinguishment of $58,691, which netted to an overall loss on debt extinguishment
of $558,198 - see below.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">June 2016 Amendments - This loss on debt
extinguishment arose from the Amendments (the &ldquo;Amendments&rdquo;) to our November 2014 convertible notes The Amendments
provided that the maturity date of the notes was extended from June 1, 2016 to July 1, 2017 and that the conversion price was
reduced from $5.60 per share of common stock to $5.00 per share of common stock. In addition, we reduced the purchase price of
warrants issued in connection with the notes from $8.40 per share to $5.00 per share. In connection with these modifications,
each of the Investors signed a consent and waiver providing its consent under certain restrictive provisions, and waiving certain
rights, including a right to participate in certain offerings made by us, under a securities purchase agreement dated June 23,
2015, (the &ldquo;2015 SPA&rdquo;) to which we, the Investors and certain other investors are parties, in order to facilitate
an at-the-market equity program described in the liquidity and capital resources section of this report below. This loss also
included an $80,000 fee to extend the November 2014 convertible notes from June 1, 2016 to July 1, 2017. The $80,000 amount was
not a cash payment but rather was added to the principal of the notes.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">December 2016 Financing - In connection
with the issuance of the December 2016 10% Convertible Notes, the conversion price of the November 2014 10% Convertible Notes
was reduced from $5.00 to $4.00 per share and the expiration date of the November 2014 10% Convertible Notes was extended from
July 1, 2017 to July 1, 2018.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The modification of the Notes was evaluated
under FASB Accounting Standards Codification (&ldquo;ASC&rdquo;) Topic No. 470-50-40, &ldquo;Debt Modification and Extinguishments&rdquo;.
Therefore, according to the guidance, the instruments were determined to be substantially different, and the transaction qualified
for extinguishment accounting. As a result, we recorded a gain on debt extinguishment of $58,691, which is included in other (income)
expenses in the accompanying condensed consolidated statements of operations. The recording of the modified Notes resulted in
a beneficial conversion of $233,748 which is the result of the effective conversion price of the new Notes being less than the
market price of the underlying common stock on the date of modification.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Loss on Warrant Repricing</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On June 27, 2016, we and certain investors
(the &ldquo;Unit Investors&rdquo;) entered into Consent and Waiver and Amendment agreements (the &ldquo;CWAs&rdquo;), relating
to an aggregate of 264,000 Warrants to Purchase Common Stock (the &ldquo;Unit Warrants&rdquo;) we had issued to the Unit Investors
on December 2, 2014 pursuant to a Securities Purchase Agreement dated November 26, 2014 (the &ldquo;2014 SPA&rdquo;). In the CWAs,
each of the Unit Investors provided its consent under certain restrictive provisions, and waived certain rights, including a right
to participate in certain offerings made by us, under the 2014 SPA in order to facilitate the at-the-market equity program described
in the notes to the Financial Statements. Pursuant to the CWAs, we reduced the Exercise Price (as defined in the Unit Warrants)
from $15.00 per share of common stock to $5.00 per share of common stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On June 27, 2016, each of the Unit Investors
also entered into a Consent and Waiver providing its consent under certain provisions, and waiving certain rights, including a
right to participate in certain offerings made by us, under the 2015 SPA in order to facilitate the at-the-market equity program
described in the notes to the Financial Statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We measured the change in fair value that
arose from the reduction in exercise price from $15.00 to $5.00 and recorded a charge of $345,841 to our other expense to reflect
this change.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">There was no comparable loss on debt extinguishment
in the fiscal year ended March 31, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><BR>
Interest and other debt expenses</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our interest and other debt expense decreased
by $269,452 from the fiscal year ended March 31, 2016 to the fiscal year ended March 31, 2017. The following table breaks out
the various components of our interest expense over the fiscal years ended March 31, 2017 and 2016:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="10" STYLE="text-align: center; border-bottom: Black 1pt solid">Components of Interest Expense and Other Debt
    <BR>Expenses in Fiscal Year Ended</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">March 31, <BR>2017</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">March 31, <BR>2016</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Change</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 55%; text-align: left">Interest expense</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 11%; text-align: right">83,891</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 11%; text-align: right">56,549</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 11%; text-align: right">27,342</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Amortization of deferred financing costs</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">27,641</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">144,683</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(117,042</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Amortization of note discounts</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">192,798</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">372,550</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(179,752</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Total interest and other debt expenses</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">304,330</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">573,782</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(269,452</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">As noted in the above table, the primary
factors in the $269,452 overall decrease in interest and other debt expenses was a $179,752 decrease in the amortization of note
discounts and a $117,042 decrease in the amortization of deferred financing costs.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">As a result of the above factors, our net
loss before noncontrolling interests increased from $4,958,616 for the fiscal year ended March 31, 2016 to $7,306,726 for the
fiscal year ended March 31, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>




<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Liquidity and Capital Resources</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">At March 31, 2017, we had a cash balance
of $1,559,701 and working capital of $985,496. This compares to a cash balance of $2,123,737 and working capital of $1,849,891
at March 31, 2016. Significant additional financing must be obtained in order to provide a sufficient source of operating capital
and to allow us to continue to operate as a going concern. In addition, we will need to raise capital to complete anticipated
future human clinical trials in the U.S. We anticipate the primary source of this additional financing will be from proceeds of
the Company&rsquo;s at-the-market offering program and other forms equity placements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We raised $2,759,355 in net proceeds from
sales of common stock under our S-3 registration statement during the fiscal year ended March 31, 2017. However, we will require
significant additional financing to finalize the current and expected additional future clinical trials in the U.S., as well as
fund all of our continued research and development activities for the Hemopurifier and other future products through the remainder
of the fiscal year ending March 31, 2018. In addition, as we expand our activities, our overhead costs to support personnel, laboratory
materials and infrastructure will increase. Should the financing we require to sustain our working capital needs be unavailable
to us on reasonable terms, if at all, when we require it, we may be unable to support our research and FDA review activities including
our planned clinical trials. The failure to implement our research and clearance activities would have a material adverse effect
on our ability to commercialize our products.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Future capital requirements will depend
upon many factors, including progress with pre-clinical testing and clinical trials, the number and breadth of our clinical programs,
the time and costs involved in preparing, filing, prosecuting, maintaining and enforcing patent claims and other proprietary rights,
the time and costs involved in obtaining regulatory approvals, competing technological and market developments, as well as our
ability to establish collaborative arrangements, effective commercialization, marketing activities and other arrangements. We
expect to continue to incur increasing negative cash flows and net losses for the foreseeable future.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Going Concern</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The accompanying consolidated financial
statements have been prepared assuming that we will continue as a going concern, which contemplates, among other things, the realization
of assets and satisfaction of liabilities in the ordinary course of business. We have incurred continuing losses from operations
and at March 31, 2017 had an accumulated deficit of approximately $93,778,000. These factors, among other matters, raise substantial
doubt about our ability to continue as a going concern. A significant amount of additional capital will be necessary to advance
the development of our products to the point at which they may become commercially viable. We intend to fund operations, working
capital and other cash requirements for the fiscal year ending March 31, 2018 through debt and/or equity financing arrangements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We are currently addressing our liquidity
issue by seeking additional investment capital through issuances of common stock under our existing S-3 registration statement
and by applying for additional grants issued by government agencies in the United States. We believe that our cash on hand and
funds expected to be received from additional debt and equity financing arrangements will be sufficient to meet our liquidity
needs for fiscal 2018. However, no assurance can be given that we will receive any funds in addition to the funds we have received
to date.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The successful outcome of future activities
cannot be determined at this time and there is no assurance that, if achieved, we will have sufficient funds to execute our intended
business plan or generate positive operating results.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The consolidated financial statements do
not include any adjustments related to this uncertainty and as to the recoverability and classification of asset carrying amounts
or the amount and classification of liabilities that might result should we be unable to continue as a going concern.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Cash Flows</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Cash flows from operating, investing and
financing activities, as reflected in the accompanying Consolidated Statements of Cash Flows, are summarized as follows (in thousands):</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="text-align: center; border-bottom: Black 1pt solid">(In thousands) <BR> For the year ended</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">March 31, <BR>2017</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">March 31, <BR>2016</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">Cash (used in) provided by:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 66%; text-align: left">Operating activities</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">(3,506</TD><TD STYLE="width: 1%; text-align: left">)</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">(4,329</TD><TD STYLE="width: 1%; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">Investing activities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(16</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(9</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Financing activities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">2,958</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">5,607</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Net (decrease) increase in cash</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(564</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">1,269</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We used cash in our operating activities
due to our losses from operations. Net cash used in operating activities was approximately $3,506,000 in fiscal 2017 compared
to net cash used in operating activities of approximately $4,329,000 in fiscal 2016, a decrease of approximately $823,000. The
$823,000 decrease was primarily due to the combination of the change in collection of accounts receivable of approximately $206,000,
an increase in our accounts payable and other current liabilities of approximately $369,000, and a decrease in fiscal 2017 in
the cash used in operations before changes in operating assets and liabilities of approximately $236,000.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Net Cash from Investing Activities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">During the fiscal year ended March 31,
2017, we purchased approximately $16,000 of equipment while in March 31, 2016, we purchased approximately $9,000 of equipment,
an increase of approximately $7,000 in our investing activities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Net Cash from Financing Activities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Net cash generated from financing activities
decreased from approximately $5,607,000 in the fiscal year ended March 31, 2016 to approximately $3,506,000 in the fiscal year
ended March 31, 2017. In fiscal 2017, we raised approximately $2,759,000 from the issuance of common stock and approximately $577,000
from the issuance of convertible notes. That source of cash from our financing activities was partially offset by the use of approximately
$379,000 to pay for the tax withholding on restricted stock units. The net cash provided by financing activities in fiscal 2016
was all from the issuance of common stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">At the date of this filing, we plan to
invest significantly into purchases of our raw materials and into our contract manufacturing arrangement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Current Events</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In April 2017, we agreed with two individual
investors to exchange 11,497 restricted shares for the cancellation of 22,993 warrants.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In April 2017, we issued 15,000 shares
of restricted common stock at a price of $2.24 per share in payment for digital communications consulting services valued at $33,600
based on the value of the services provided.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In April 2017, 46,125 RSUs held by our
executives were exchanged into the same number of shares of our common stock. As our executives elected to return a portion of
their RSU&rsquo;s in exchange for the Company paying the related withholding taxes on the share issuance, 23,655 of the RSUs were
cancelled and we issued a net 22,470 shares to our executives.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In April 2017, we terminated a previously
recorded but unissued share award of 68,000 shares under a restricted stock grant to our CEO and issued to him 32,674 shares as
a net settlement of shares and the Company paid the withholding taxes associated with that share issuance in return for the cancellation
of 35,326 shares. The compensation cost of that restricted stock grant had been fully recorded over prior fiscal years, therefore
no expense was recorded regarding this net issuance.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In the period since March 31, 2017, sold
1,000 shares of common stock under our Common Stock Sales Agreement with H.C. Wainwright. We raised aggregate net proceeds of
$1,903 (net of $63 in commissions to H.C. Wainwright and $133 in other offering expenses) under this agreement at an average price
of $1.90 per share of net proceeds.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In June 2017, we issued options to four
of our employees to purchase 34,500 shares of common stock at a price of $1.68 per share, the closing price on the date of the
approval of the option grants by our compensation committee.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In June 2017, we entered into an Exchange
Agreement with two institutional investors under which we issued 57,844 restricted shares in exchange for the cancellation of
77,125 warrants held by those investors. Additionally, we agreed with those investors that they would extend the expiration dates
of convertible notes held by those investors from July 1, 2018 to July 1, 2019 in exchange for the reduction of the conversion
price of those notes from $4.00 per share to $3.00 per share.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">From April 1, 2017 through September 12,
2017, we entered into sales under our ATM facility of 601,504 shares of common stock for aggregate net proceeds to us of $1,650,314.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Critical Accounting Policies</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Use of Estimates</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The preparation of consolidated financial
statements in conformity with accounting principles generally accepted in the United States of America (&ldquo;GAAP&rdquo;) requires
us to make a number of estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements. Such estimates and assumptions affect the reported
amounts of expenses during the reporting period. On an ongoing basis, we evaluate estimates and assumptions based upon historical
experience and various other factors and circumstances. We believe our estimates and assumptions are reasonable in the circumstances;
however, actual results may differ from these estimates under different future conditions. We believe that the estimates and assumptions
that are most important to the portrayal of our financial condition and results of operations, in that they require the most difficult,
subjective or complex judgments, form the basis for the accounting policies deemed to be most critical to us. These critical accounting
estimates relate to revenue recognition, stock purchase warrants issued with notes payable, beneficial conversion feature of convertible
notes payable, impairment of intangible assets and long lived assets, stock compensation, deferred tax asset valuation allowance,
and contingencies.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Fair Value Measurements</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>




<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We measure the fair value of applicable
financial and non-financial instruments based on the following fair value hierarchy:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">Level 1: Quoted market prices in active markets for identical assets or
    liabilities.</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">Level 2: Observable market based inputs or unobservable inputs that are
    corroborated by market data.</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" STYLE="width: 100%; margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">Level 3: Unobservable inputs that are not corroborated by market data.</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The hierarchy noted above requires us to
minimize the use of unobservable inputs and to use observable market data, if available, when determining fair value.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The fair value of derivative liabilities
was determined based on unobservable inputs that are not corroborated by market data, which is a Level 3 classification. We recorded
derivative liabilities on our balance sheet at fair value with changes in fair value recorded in our consolidated statements of
operations. At March 31, 2017, we had no derivative liabilities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Revenue Recognition</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">With respect to revenue recognition, we
entered into a government contract with DARPA and have recognized revenue during the fiscal years ended March 31, 2017 and 2016
of $387,438 and $863,011, respectively, under such contract. We adopted the Milestone method of revenue recognition for the DARPA
contract under Financial Accounting Standards Board&rsquo;s Accounting Standards Codification (&ldquo;ASC&rdquo;) 605-28 &ldquo;Revenue
Recognition &ndash; Milestone Method&rdquo; and we believe we meet the requirements under ASC 605-28 for reporting contract revenue
under the Milestone Method for the fiscal years ended March 31, 2017 and 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We also recognize revenue for a secondary
smaller contract under a time and materials non-fixed price basis where we recognize revenue as the services are performed.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Stock Purchase Warrants</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left; text-indent: 0.5in">We grant warrants in
connection with the issuance of certain notes payable and other financing transactions. When such warrants are classified as equity,
we measure the relative estimated fair value of such warrants which represents a discount from the face amount of the notes payable.
Such discounts are amortized to interest expense over the term of the notes. We analyze such warrants for classification as either
equity or derivative liabilities and value them based on binomial lattice models.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Beneficial Conversion Feature of Notes Payable</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The convertible feature of certain notes
payable provides for a rate of conversion that is below market value. Such feature is normally characterized as a &quot;beneficial
conversion feature&rdquo; of which we measure the estimated fair value in circumstances in which the conversion feature is not
required to be separated from the host instrument and accounted for separately, and record that value in the consolidated financial
statements as a discount from the face amount of the notes. Such discounts are amortized to interest expense over the term of
the notes.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Share-based Compensation</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We account for share-based compensation
awards using the fair-value method and record such expense based on the grant date fair value in the consolidated financial statements
over the requisite service period.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Derivative Instruments</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 40pt">We evaluate free-standing
derivative instruments (or embedded derivatives) to properly classify such instruments within equity or as liabilities in our
financial statements. Our policy is to settle instruments indexed to our common shares on a first-in-first-out basis.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The classification of a derivative instrument
is reassessed at each reporting date. If the classification changes as a result of events during a reporting period, the instrument
is reclassified as of the date of the event that caused the reclassification. There is no limit on the number of times a contract
may be reclassified.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Instruments classified as derivative liabilities
are remeasured each reporting period (or upon reclassification) and the change in fair value is recorded on our consolidated statement
of operations in other expense (income). We had no derivative instruments at March 31, 2017 and at March 31, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Income Taxes</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Deferred tax assets are recognized for
the future tax consequences attributable to the difference between the consolidated financial statements and their respective
tax basis. Deferred income taxes reflect the net tax effects of (a) temporary differences between the carrying amounts of assets
and liabilities for financial reporting purposes and the amounts reported for income tax purposes, and (b) tax credit carryforwards.
We record a valuation allowance for deferred tax assets when, based on our best estimate of taxable income (if any) in the foreseeable
future, it is more likely than not that some portion of the deferred tax assets may not be realized.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>




<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Off-Balance Sheet Arrangements</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have not entered into any off-balance
sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in
financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is
material to investors.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Convertible Notes Payable and Warrants</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">DECEMBER 2016 10% CONVERTIBLE NOTES</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In December 2016, we entered into a securities
purchase agreement (the &ldquo;Securities Purchase Agreement&rdquo;) with two accredited investors (collectively, the &ldquo;Holders&rdquo;),
pursuant to which the Holders purchased an aggregate of $680,400 principal amount of Notes (inclusive of due diligence fee of
$30,000 deemed paid as a subscription amount in the form of a Note in the principal amount of $32,400) for an aggregate cash subscription
amount of $600,000 and (b) warrants to purchase 127,575 shares of Common Stock (collectively, the &ldquo;Warrants&rdquo;).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The Notes bear interest at the rate of
10% per annum, and the principal amount and all accrued and unpaid interest thereon is convertible into shares of our common stock
at a $4.00 per share conversion price, which is subject to customary adjustment provisions for stock splits, dividends, recapitalizations
and the like. The Notes mature on July 1, 2018 and are subject to customary and usual terms for events of default and the like.
Each Holder has contractually agreed to restrict its ability to convert its Note such that the number of shares of the Common
Stock held by the Holder and its affiliates after such exercise does not exceed 4.99% of our then issued and outstanding shares
of Common Stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The Warrants issued to the Holders are
exercisable for a period of five years from the date of issuance at an exercise price of $4.50, subject to adjustment. A Holder
may exercise a Warrant by paying the exercise price in cash or by exercising the Warrant on a cashless basis. In the event a Holder
exercises a Warrant on a cashless basis, we will not receive any proceeds. The exercise price of the Warrants is subject to customary
adjustments provision for stock splits, stock dividends, recapitalizations and the like. Each Holder has contractually agreed
to restrict its ability to exercise its Warrant such that the number of shares of the Common Stock held by the Holder and its
affiliates after such exercise does not exceed 4.99% of our then issued and outstanding shares of Common Stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The estimated relative fair value of Warrants
issued in connection with the Notes was recorded as a debt discount and is being amortized as additional interest expense over
the term of the underlying debt. We recorded debt discount of $232,718 based on the relative fair value of these Warrants. In
addition, as the effective conversion price of the Notes was less than market price of the underlying common stock on the date
of issuance, we recorded an additional debt discount of $262,718 related to the beneficial conversion feature. We also recorded
deferred financing costs of $102,940, which was composed of an 8% original issue discount of $50,400, a $30,000 due diligence
fee (which was paid in the form of a note), $22,500 in legal fees, and a $40 bank charge. The combination of the above items led
to a combined discount against the convertible notes of $598,376.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">NOVEMBER 2014 10% CONVERTIBLE NOTES</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In November 2014, we entered into a subscription
agreement with two accredited investors providing for the issuance and sale of (i) convertible promissory notes in the aggregate
principal amount of $527,780 (the &ldquo;Notes&rdquo;) and (ii) five year warrants to purchase up to 47,125 shares of common stock
at a fixed exercise price of $8.40 per share (the &ldquo;Warrants&rdquo;). These Notes bear interest at the annual rate of 10%
and originally matured on April 1, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The aggregate gross cash proceeds to us
were $415,000 after subtracting legal fees of $35,000, a $27,780 due diligence fee and an original issuance discount of $50,000.
We recorded deferred financing costs of $112,780 to reflect the legal fees, due diligence fee and original issuance discount and
will amortize those costs over the life of the Notes using the effective interest method.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">These Notes are convertible at the option
of the holders into shares of our common stock at a fixed price of $5.60 per share, for up to an aggregate of 94,246 shares of
common stock. There are no registration requirements with respect to the shares of common stock underlying the Notes or the Warrants.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The estimated relative fair value of Warrants
issued in connection with the Notes was recorded as a debt discount and is amortized as additional interest expense over the term
of the underlying debt. We recorded debt discount of $240,133 based on the relative fair value of these Warrants. In addition,
as the effective conversion price of the Notes was less than market price of the underlying common stock on the date of issuance,
we recorded an additional debt discount of $287,647 related to the beneficial conversion feature.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.9pt"><B>Initial Amendment of the November 2014
10% Convertible Note Terms</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.9pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On November 12, 2015, we entered into an
amendment of terms (&ldquo;Amendment of Terms&rdquo;) with the two investors that participated in the November 2014 10% Convertible
Notes. The Amendment of Terms modified the terms of the subscription agreement, Notes and Warrants held by those investors to,
among other things, extended the maturity date of the Notes from April 1, 2016 to June 1, 2016, temporarily reduced the number
of shares that we must reserve with respect to conversion of the Notes, and temporarily suspended the time period during which
one of the investors may exercise its Warrants. In exchange for the investors&rsquo; agreements in the Amendment of Terms, we
paid one of the investors a cash fee of $90,000, which we recorded as deferred financing costs and amortized over the remaining
term of the notes.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Second Amendment and Extension of the November 2014 10%
Convertible Notes</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On June 27, 2016, we and certain investors
entered into further Amendments (the &ldquo;Amendments&rdquo;) to the Notes and the Warrants. The Amendments provide that the
Maturity Date (as defined in the Notes) was extended from June 1, 2016 to July 1, 2017 and that the conversion price per share
of the Notes was reduced from $5.60 per share of common stock to $5.00 per share of common stock. In addition, we reduced the
purchase price (as defined in the Warrants) from $8.40 per share to $5.00 per share of common stock. In connection with these
modifications, each of the investors signed a Consent and Waiver providing its consent under certain restrictive provisions, and
waiving certain rights, including a right to participate in certain offerings made by us, under a Securities Purchase Agreement
dated June 23, 2015, (the &ldquo;2015 SPA&rdquo;) to which we, the investors and certain other investors are parties, in order
to facilitate an at-the-market equity program (see Note 6).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The Amendments also increase the principal
amount of the Notes to $692,811 (in the aggregate) to (i) include accrued and unpaid interest through June 15, 2016, and (ii)
increase the principal amount by $80,000 (in the aggregate) as an extension fee for the extended maturity date of the Notes. With
respect to each Note, we entered into an Allonge to Convertible Promissory Note (each, an &ldquo;Allonge&rdquo;) reflecting the
changes in the principal amount, Maturity Date and conversion price of the Note.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We also issued to the investors new warrants
(the &ldquo;New Warrants&rdquo;) to purchase an aggregate of 30,000 shares of common stock with a Purchase Price (as defined in
the New Warrants) of $5.00 per share of common stock. We issued the New Warrants in substantially the same form as the prior Warrants,
and the New Warrants will expire on November 6, 2019, the same date on which the prior Warrants will expire.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The modification of the Notes was evaluated
under FASB Accounting Standards Codification (&ldquo;ASC&rdquo;) Topic No. 470-50-40, &ldquo;Debt Modification and Extinguishments&rdquo;.
Therefore, according to the guidance, the instruments were determined to be substantially different, and the transaction qualified
for extinguishment accounting. As a result, we recorded a loss on debt extinguishment of $536,889 and recognized an extension
fee expense of $80,000, which are included in other (income) expenses in the accompanying condensed consolidated statements of
operations. The debt extinguishment is comprised from the fair value of prior warrants issued in connection with the Notes of
$287,676, as well as $325,206 related to beneficial conversion feature and offset by debt discount of $75,993. The beneficial
conversion feature is a result of the effective conversion price of the new Notes being less than the market price of the underlying
common stock on the date of modification.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Third Amendment and Extension of the November 2014 10% Convertible
Notes</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In connection with the issuance of the
December 2016 10% Convertible Notes, the conversion price of the November 2014 10% Convertible Notes was reduced from $5.00 to
$4.00 per share and the expiration date of the November 2014 10% Convertible Notes was extended from July 1, 2017 to July 1, 2018.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The modification of the Notes was evaluated
under FASB Accounting Standards Codification (&ldquo;ASC&rdquo;) Topic No. 470-50-40, &ldquo;Debt Modification and Extinguishments&rdquo;.
Therefore, according to the guidance, the instruments were determined to be substantially different, and the transaction qualified
for extinguishment accounting. As a result, we recorded a gain on debt extinguishment of $58,691, which is included in other (income)
expenses in the accompanying condensed consolidated statements of operations. The recording of the modified Notes resulted in
a beneficial conversion of $233,748 which is the result of the effective conversion price of the new Notes being less than the
market price of the underlying common stock on the date of modification.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left"><B>March 2017 Registered Direct Offering</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On March 22, 2017, we entered into a Securities
Purchase Agreement (the &ldquo;Purchase Agreement&rdquo;) with certain institutional investors (the &ldquo;Investors&rdquo;) for
the sale of 575,000 shares of our common stock, par value $0.001 per share (the &ldquo;Common Stock&rdquo;), at a purchase price
of $3.50 per share, in a registered direct offering. Concurrently with the sale of the Common Shares, pursuant to the Purchase
Agreement, we also sold in a private placement warrants to purchase 575,000 shares of Common Stock (the &ldquo;Warrants&rdquo;).
The aggregate gross proceeds for the sale of the Common Shares and Warrants will be approximately $2 million. Subject to certain
ownership limitations, the Warrants will be initially exercisable commencing six months from the issuance date at an exercise
price equal to $3.95 per share of Common Stock, subject to adjustments as provided under the terms of the Warrants. The Warrants
will be exercisable for five years from the initial exercise date.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The net proceeds to us from the transactions,
after deducting the placement agent&rsquo;s fees and expenses (not including the Wainwright Warrants, as defined below), our estimated
offering expenses, and excluding the proceeds, if any, from the exercise of the Warrants, were $1,804,250. We intend to use the
net proceeds from the transactions for general corporate purposes.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The Common Shares (but not the Warrants
or shares issuable upon exercise of the Warrant) were sold by us pursuant to an effective shelf registration statement on Form
S-3, which was filed with the Securities and Exchange Commission (the &ldquo;SEC&rdquo;) on May 5, 2016 and subsequently declared
effective on May 12, 2016 (File No. 333-211151) (the &ldquo;Registration Statement&rdquo;), and the base prospectus dated as of
May 12, 2016 contained therein. We filed a prospectus supplement and the accompanying prospectus with the SEC in connection with
this sale of the Common Shares.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>





<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We also reduced the dollar amount of our
current at the market offering to $9,532,294 as a result of this offering and prior sales under the at the market offering.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The purchase agreement also covered the
exchange of 264,000 warrants issued to the purchasers thereunder in December 2014 for 198,000 shares of our common stock. Further,
in exchange for certain waivers given by the purchasers and certain other investors in a private placement of the Company in June
2015, the warrants issued in such private placement were amended to (i) reduce the exercise price to $3.95 per share, (ii) make
the warrants non-exercisable for a period of six months from the date of amendment, and (iii) extend the term of those warrants
by six months.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The Warrants and the shares issuable upon
exercise of the Warrants were sold and issued without registration under the Securities Act of 1933 (the &ldquo;Securities Act&rdquo;)
in reliance on the exemptions provided by Section 4(a)(2) of the Securities Act as transactions not involving a public offering
and Rule 506 promulgated under the Securities Act as sales to accredited investors, and in reliance on similar exemptions under
applicable state laws.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We also entered into an engagement letter
(the &ldquo;Engagement Letter&rdquo;) with Rodman &amp; Renshaw, a unit of H.C. Wainwright &amp; Co., LLC (&ldquo;Rodman&rdquo;),
pursuant to which Rodman agreed to serve as exclusive placement agent for the issuance and sale of the Common Shares and Warrants.
We paid Rodman an aggregate fee equal to 6% of the gross proceeds received by us from the sale of the securities in the transactions.
Pursuant to the Engagement Letter, we also agreed to grant to Rodman or its designees warrants to purchase up to 3% of the aggregate
number of shares sold in the transaction (the &ldquo;Rodman Warrants&rdquo;). The Engagement Letter has a nine month tail and
right of first offer periods, indemnity and other customary provisions for transactions of this nature. The Rodman Warrants have
substantially the same terms as the Warrants, except that the exercise price is 125% of $3.50. The Rodman Warrants and the shares
issuable upon exercise of the Rodman Warrants were issued in reliance on the exemption from registration provided by Section 4(a)(2)
of the Securities Act as transactions not involving a public offering and in reliance on similar exemptions under applicable state
laws. We also paid Rodman a reimbursement for non-accountable expenses in the amount of $50,000.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Securities Issued for Debt</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Historically, we have issued securities
for debt to reduce our obligations to avoid using our cash resources. In the fiscal year ended March 31, 2017 we issued 33,091
unregistered common shares for repayment in full of notes, including accrued interest, in the aggregate amount of $144,718. In
the fiscal year ended March 31, 2016 we did not issue any securities for debt. The average price discount of the common stock
issued for debt in the fiscal year ended March 31, 2017 was approximately 13%.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>For the Three Months Ended June 30, 2017 and 2016</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">RESULTS OF OPERATIONS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">THREE MONTHS ENDED JUNE 30, 2017 COMPARED TO THE THREE MONTHS
ENDED JUNE 30, 2016</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Revenues</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We did not record any government contract
revenue in the three months ended June 30, 2017 and we recorded government contract revenue in the three months ended June 30,
2016. This revenue arose from work performed under our government subcontract with Battelle Memorial Institute as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Three Months<BR> Ended 6/30/17</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Three Months<BR> Ended 6/30/16</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Change in<BR> Dollars</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 55%; text-align: left; padding-bottom: 1pt">Battelle Subcontract</TD><TD STYLE="width: 2%; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="width: 1%; padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; border-bottom: Black 1pt solid; text-align: right">4,635</TD><TD STYLE="width: 1%; padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; border-bottom: Black 1pt solid; text-align: right">(4,635</TD><TD STYLE="width: 1%; padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Total Government Contract Revenue</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">4,635</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(4,635</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD></TR>
</TABLE>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><I>&nbsp;</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><I>&nbsp;</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><I>&nbsp;</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><I>&nbsp;&nbsp;</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><I>DARPA Contract</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Previously, we generated contract revenue
under a contract with DARPA that we entered into on September 30, 2011. Under the DARPA award, we were engaged to develop a therapeutic
device to reduce the incidence of sepsis, a fatal bloodstream infection that often results in the death of combat-injured soldiers.
That contract was completed on September 30, 2016 and the related subcontract with Battelle was completed in March 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Operating Expenses</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Consolidated operating expenses for the
three months ended June 30, 2017 were $1,160,249 in comparison with $1,136,287 for the comparable period a year ago. This increase
of $23,962, or 2.1%, was due to increases in payroll and related expenses of $285,240, which was partially offset by a $224,726
decrease in professional fees and a $36,552 decrease in general and administrative expenses.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The $285,240 increase in payroll and related
expenses was primarily due to a $230,200 increase in stock-based compensation. The increase in stock-based compensation was due
to the RSU grants to our officers and directors in August 2016. Our cash-based payroll and related expenses increased by $55,040
due to headcount additions in our scientific staff.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The $224,726 decrease in our professional
fees was due to decreases in our non-DARPA-related professional fees of $208,236, in our DARPA-related professional fees of $11,600
and in our professional fees at ESI of $4,890. The $208,236 decrease in our non-DARPA-related professional fees was due to a $189,247
decrease in our legal fees, a $34,000 decrease in business development expenses, and a $25,993 decrease in our investor relations
fees.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The $36,552 decrease in general and administrative
expenses was primarily due to decreases of $21,264 in our DARPA-related general and administrative expenses and $14,706 in the
general and administrative expenses at ESI.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Other Expense</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Other expense during the three months ended
June 30, 2017 and 2016 consisted of losses on debt extinguishment, warrant repricing expense, losses on share for warrant exchanges
and interest expense. Other expense for the three months ended June 30, 2017 was other expense of $685,302 in comparison with
other expense of $1,004,897 for the three months ended June 30, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The following table breaks out the various
components of our other expense for both periods:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">Three Months&nbsp;<BR> Ended</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">Three Months&nbsp;<BR> Ended</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">6/30/17</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">6/30/16</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Change</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 55%; text-align: left">Loss on Debt Extinguishment</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 11%; text-align: right">376,909</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 11%; text-align: right">616,889</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 11%; text-align: right">(239,980</TD><TD STYLE="width: 1%; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Loss on Warrant Repricing</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">345,841</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(345,841</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">Loss on Share for Warrant Exchanges</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">119,789</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">119,789</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Interest Expense</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">188,604</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">42,167</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">146,437</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Total Other Expense</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">685,302</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">1,004,897</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(319,595</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Loss on Debt Extinguishment</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our loss on debt extinguishment for the
three months ended June 30, 2017 arose from a $376,909 loss associated with the June 2017 amendments to our convertible notes.
This compared to a loss of debt extinguishment of $616,889 for the three months ended June 30, 2016 - see below for additional
information.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">June 2017 Amendments &ndash; The $376,909
loss on debt extinguishment in the three months ended June 30, 2017 arose from an Exchange Agreement with two institutional investors
under which we issued 57,844 restricted shares in exchange for the cancellation of 77,125 warrants held by those investors (see
Loss on Share for Warrant Exchanges below). Additionally, we agreed with those investors that they would extend the expiration
dates of the convertible notes held by those investors from July 1, 2018 to July 1, 2019 in exchange for the reduction of the
conversion price of those notes from $4.00 per share to $3.00 per share. The modification of the notes was evaluated under FASB
Accounting Standards Codification (&ldquo;ASC&rdquo;) Topic No. 470-50-40, &ldquo;Debt Modification and Extinguishments&rdquo;.
Therefore, according to the guidance, the instruments were determined to be substantially different, and the transaction qualified
for extinguishment accounting.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">June 2016 Amendments - This loss on debt
extinguishment arose from the Amendments (the &ldquo;Amendments&rdquo;) to our November 2014 convertible notes The Amendments
provided that the maturity date of the notes was extended from June 1, 2016 to July 1, 2017 and that the conversion price was
reduced from $5.60 per share of common stock to $5.00 per share of common stock. In addition, we reduced the purchase price of
warrants issued in connection with the notes from $8.40 per share to $5.00 per share. In connection with these modifications,
each of the Investors signed a consent and waiver providing its consent under certain restrictive provisions, and waiving certain
rights, including a right to participate in certain offerings made by us, under a securities purchase agreement dated June 23,
2015, (the &ldquo;2015 SPA&rdquo;) to which we, the Investors and certain other investors are parties, in order to facilitate
an at-the-market equity program described in the liquidity and capital resources section of this report below. This loss also
included an $80,000 fee to extend the November 2014 convertible notes from June 1, 2016 to July 1, 2017. The $80,000 amount was
not a cash payment but rather was added to the principal of the notes.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">This modification of the notes was also
evaluated under ASC Topic No. 470-50-40, &ldquo;Debt Modification and Extinguishments&rdquo;. Therefore, according to the guidance,
the instruments were determined to be substantially different, and the transaction qualified for extinguishment accounting.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>




<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Loss on Warrant Repricing</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On June 27, 2016, we and certain investors
(the &ldquo;Unit Investors&rdquo;) entered into Consent and Waiver and Amendment agreements (the &ldquo;CWAs&rdquo;), relating
to an aggregate of 264,000 Warrants to Purchase Common Stock (the &ldquo;Unit Warrants&rdquo;) we had issued to the Unit Investors
on December 2, 2014 pursuant to a Securities Purchase Agreement dated November 26, 2014 (the &ldquo;2014 SPA&rdquo;). In the CWAs,
each of the Unit Investors provided its consent under certain restrictive provisions, and waived certain rights, including a right
to participate in certain offerings made by us, under the 2014 SPA in order to facilitate the at-the-market equity program described
in the notes to the Financial Statements. Pursuant to the CWAs, we reduced the Exercise Price (as defined in the Unit Warrants)
from $15.00 per share of common stock to $5.00 per share of common stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On June 27, 2016, each of the Unit Investors
also entered into a Consent and Waiver providing its consent under certain provisions, and waiving certain rights, including a
right to participate in certain offerings made by us, under the 2015 SPA in order to facilitate the at-the market equity program
described in the notes to the Financial Statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We measured the change in fair value that
arose from the reduction in exercise price from $15.00 to $5.00 and recorded a charge of $345,841 to our other expense to reflect
this change.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Loss on Share for Warrant Exchanges</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">During the three months ended June 30,
2017, we agreed with two individual investors to exchange 11,497 restricted shares for the cancellation of 22,993 warrants. Additionally,
during the period, we entered into an Exchange Agreement with two institutional investors under which we issued 57,844 restricted
shares in exchange for the cancellation of 77,125 warrants held by those investors. We measured the fair value of the shares issued
and the fair value of the warrants exchanged for those shares and recorded losses for each of those exchanges based on the changes
in fair value between the instruments exchanged.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Interest Expense</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Interest expense was $188,604 for the three
months ended June 30, 2017 compared to $42,167 in the corresponding prior period, an increase of $146,437. The various components
of our interest expense are shown in the following table:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">Three Months&nbsp;<BR> Ended</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">Three Months<BR> Ended</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">6/30/17</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">6/30/16</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Change</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 55%; text-align: left">Interest Expense</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 11%; text-align: right">33,802</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 11%; text-align: right">14,526</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 11%; text-align: right">19,276</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Amortization of Deferred Financing Costs</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">27,641</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(27,641</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Amortization of Note Discounts</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">154,802</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">154,802</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Total Interest Expense</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">188,604</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">42,167</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">146,437</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">As noted in the above table, the most significant
factor in the $146,437 increase in interest expense was the $154,802 increase in the amortization of note discounts, which related
to the amortization against the discount on our convertible notes. Other smaller factors in the change in our total interest were
a $27,641 decrease in the amortization of deferred financing costs and a $19,276 increase in our contractual interest expense.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Net Loss</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">As a result of the changes in revenues
and expenses noted above, our net loss before noncontrolling interests decreased from approximately $2,137,000 in the three month
period ended June 30, 2016 to $1,846,000 in the three month period ended June 30, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Basic and diluted loss attributable to
common stockholders were ($0.21) for the three month period ended June 30, 2017 compared to ($0.28) for the period ended June
30, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">LIQUIDITY AND CAPITAL RESOURCES</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">At June 30, 2017, we had a cash balance
of $327,206 and negative working capital of $42,649. This compares to a cash balance of $1,559,701 and working capital of $985,496
at March 31, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Significant additional financing must be
obtained in order to provide a sufficient source of operating capital and to allow us to continue to operate as a going concern.
In addition, we will need to raise capital to complete the approved human clinical trial in the U.S. We anticipate the primary
sources of this additional financing will be from an equity offering of up to $7.5 million based on a registration statement on
Form S-1 that we filed with the SEC on July 31, 2017, proceeds from sales of common stock under our at-the-market offering program,
from registered direct equity placements from our S-3 registration statement and from convertible debt financing.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On March 22, 2017, we entered into a Securities
Purchase Agreement (the &ldquo;Purchase Agreement&rdquo;) with certain institutional investors (the &ldquo;Investors&rdquo;) for
the sale of 575,000 shares (the &ldquo;Common Shares&rdquo;) of our common stock, par value $0.001 per share (the &ldquo;Common
Stock&rdquo;), at a purchase price of $3.50 per share, in a registered direct offering. Concurrently with the sale of the Common
Shares, pursuant to the Purchase Agreement, we also sold in a private placement warrants to purchase 575,000 shares of Common
Stock (the &ldquo;Warrants&rdquo;). The aggregate gross proceeds for the sale of the Common Shares and Warrants were approximately
$2 million.&nbsp; Subject to certain ownership limitations, the Warrants will be initially exercisable commencing six months from
the issuance date at an exercise price equal to $3.95 per share of Common Stock, subject to adjustments as provided under the
terms of the Warrants. The Warrants will be exercisable for five years from the initial exercise date.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The net proceeds to us from the transactions,
after deducting the placement agent&rsquo;s fees and expenses (not including the Wainwright Warrants, as defined below), our estimated
offering expenses, and excluding the proceeds, if any, from the exercise of the Warrants, were $1,804,250. We intend to use the
net proceeds from the transactions for general corporate purposes.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">During the fiscal year ended March 31,
2017, we also raised $955,105 from sales of our common stock under our ATM financing facility and subsequent to March 31, 2017
through the date of this filing, we have raised $42,279 from sales of our common stock under our ATM financing facility.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> If our gross proceeds from
this offering is less than $6 million, we will need to raise additional capital from other sources.The securities
purchase agreement being entered into with certain purchasers in this offering limit our ability to raise capital both (i)
for 90 days whatsoever, and (ii) for so long as warrants issued hereunder are outstanding, in any sort of variable priced
financing. Even without receipt of proceeds from this offering, we have sufficient cash to operate for the next 90 days, and
we do not intend to enter into any sort of variable priced financing in the future due to the highly dilutive nature of those
financings. Because we do not intend to enter into any variable priced financings, we would not forsee a need for a forward
or reverse split of our stock in the next 12 months. </P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Those financings, coupled with previously
existing funds on hand and revenues from our previous government contracts, have financed our operations through the first quarter
of the fiscal year ending March 31, 2018. However, we will require significant additional financing to complete the current and
expected additional future clinical trials in the U.S., as well as fund all of our continued research and development activities
for the Hemopurifier through the twelve month period from the issuance date of these interim financial statements. In addition,
as we expand our activities, our overhead costs to support personnel, laboratory materials and infrastructure will increase. Should
the financing we require to sustain our working capital needs be unavailable to us on reasonable terms, if at all, when we require
it, we may be unable to support our research and U.S. Food and Drug Administration, or FDA, clearance activities including our
planned clinical trials. The failure to implement our research and clearance activities would have a material adverse effect on
our ability to commercialize our products.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Future capital requirements will depend
upon many factors, including progress with pre-clinical testing and clinical trials, the number and breadth of our clinical programs,
the time and costs involved in preparing, filing, prosecuting, maintaining and enforcing patent claims and other proprietary rights,
the time and costs involved in obtaining regulatory approvals, any continued delays in completing our clinical trials, competing
technological and market developments, as well as our ability to establish collaborative arrangements, effective commercialization,
marketing activities and other arrangements. We expect to continue to incur increasing negative cash flows and net losses for
the foreseeable future.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Going Concern</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Management does not expect existing cash
as of June 30, 2017 to be sufficient to fund the Company&rsquo;s operations for at least twelve months from the issuance date
of these interim financial statements. These financial statements have been prepared on a going concern basis which assumes the
Company will continue to realize its assets and discharge its liabilities in the normal course of business. As of June 30, 2017,
the Company has incurred losses totaling approximately $95,620,000 since inception, has not yet generated material revenue from
operations, and will require additional funds to maintain its operations. These factors raise substantial doubt regarding the
Company&rsquo;s ability to continue as a going concern within one year after the consolidated financial statements are issued.
The Company&rsquo;s ability to continue as a going concern is dependent upon its ability to generate future profitable operations
and obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when
they become due. The Company intends to finance operating costs over the next twelve months through its existing financial resources
and we may also raise additional capital through equity offerings, including an equity offering of up to $7.5 million based on
a preliminary S-1 registration statement that we filed with the SEC on July 31, 2017, debt financings, collaborations and/or licensing
arrangements. If adequate funds are not available on acceptable terms, we may be required to delay, reduce the scope of, or curtail,
our operations. The accompanying consolidated financial statements do not include any adjustments to the recoverability and classification
of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as
a going concern.</P>





<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Cash Flows</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Cash flows from operating, investing and
financing activities, as reflected in the accompanying Condensed Consolidated Statements of Cash Flows, are summarized as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="text-align: center; border-bottom: Black 1pt solid">(In thousands)<BR> For the three months ended</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">June 30,<BR> 2017</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">June 30,<BR> 2016</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">Cash used in:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 66%; text-align: left">Operating activities</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">(1,075</TD><TD STYLE="width: 1%; text-align: left">)</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">(828</TD><TD STYLE="width: 1%; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">Investing activities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(24</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(2</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Financing activities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(134</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Net decrease in cash</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(1,233</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(830</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">NET CASH USED IN OPERATING ACTIVITIES. We used cash in our
operating activities due to our losses from operations. Net cash used in operating activities was approximately $1,075,000 in
the three months ended June 30, 2017 compared to $828,000 in the three months ended June 30, 2016, an increase of $247,000.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">NET CASH USED IN INVESTING ACTIVITIES. We used approximately
$24,000 of cash to purchase laboratory and office equipment in the three months ended June 30, 2017 compared to approximately
$2,000 in the three months ended June 30, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">NET CASH USED IN FINANCING ACTIVITIES. In the three months
ended June 30, 2017 we used approximately $134,000 in our financing activities primarily due to the payment of approximately $136,000
for tax withholding on vested rights.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">At the date of this filing, we plan to
invest significantly into purchases of our raw materials and into our contract manufacturing arrangement subject to successfully
raising additional capital.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">CRITICAL ACCOUNTING POLICIES</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The preparation of condensed consolidated
financial statements in conformity with accounting principles generally accepted in the United States of America requires us to
make a number of estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent
assets and liabilities at the date of the financial statements. Such estimates and assumptions affect the reported amounts of
expenses during the reporting period. On an ongoing basis, we evaluate estimates and assumptions based upon historical experience
and various other factors and circumstances. We believe our estimates and assumptions are reasonable in the circumstances; however,
actual results may differ from these estimates under different future conditions.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We believe that the estimates and assumptions
that are most important to the portrayal of our financial condition and results of operations, in that they require the most difficult,
subjective or complex judgments, form the basis for the accounting policies deemed to be most critical to us. These critical accounting
policies relate to revenue recognition, measurement of stock purchase warrants issued with notes payable, beneficial conversion
feature of convertible notes payable, impairment of intangible assets and long lived assets, stock compensation, and the classification
of warrant obligations, and evaluation of contingencies. We believe estimates and assumptions related to these critical accounting
policies are appropriate under the circumstances; however, should future events or occurrences result in unanticipated consequences,
there could be a material impact on our future financial condition or results of operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">There have been no changes to our critical
accounting policies as disclosed in our Form 10-K for the year ended March 31, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">OFF-BALANCE SHEET ARRANGEMENTS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have no obligations required to be disclosed
herein as off-balance sheet arrangements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><A NAME="a12"></A><B>BUSINESS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Overview and Corporate History</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">We are a medical technology
company focused on addressing unmet needs in global health and biodefense. The Aethlon Hemopurifier&reg; is a clinical-stage therapeutic
device designed for the single-use removal of life-threatening viruses from the circulatory system of infected individuals. We
believe the Hemopurifier&reg; can fulfill the studied for the broad-spectrum treatment of life-threatening highly glycosylated
viruses that are not addressed with an already approved treatment countermeasure objectives set forth by the U.S. Government to
protect citizens from bioterror and pandemic threats. In human studies, the Hemopurifier&reg; has been administered to HIV, Hepatitis-C
and Ebola infected individuals. Additionally, the Hemopurifier&reg; has also been validated to capture Zika virus, Lassa virus,
MERS-CoV, Cytomegalovirus, Epstein-Barr virus, Herpes Simplex virus, Chikungunya virus, Dengue virus, West Nile virus, Smallpox
related viruses, H1N1 Swine Flu virus, H5N1 Bird Flu virus, and the reconstructed Spanish flu virus of 1918. In several cases,
these validations were conducted in collaboration with leading government or non-government research institutes. In the United
States, we are focused on the clinical advancement of the Hemopurifier&reg; through FDA-reviewed clinical studies. We recently
concluded an FDA reviewed feasibility study to demonstrate safety of our device in health compromised individuals infected with
a viral pathogen. We are also the majority owner of Exosome Sciences, Inc. (ESI), a company focused on the discovery of exosomal
biomarkers to diagnose and monitor life-threatening diseases. Included among ESI&rsquo;s endeavors is the advancement of a TauSomeTM
biomarker candidate to diagnose Chronic Traumatic Encephalopathy (CTE) in the living. ESI previously documented that TauSome levels
in former NFL players to be 9x higher than same age-group control subjects.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On March 10, 1999, Aethlon, Inc., a California
corporation, Hemex, Inc., a Delaware corporation and the accounting predecessor to Aethlon, Inc., and Bishop, Inc., a publicly
traded company, completed an Agreement and Plan of Reorganization structured to result in Bishop, Inc.'s acquisition of all of
the outstanding common shares of Aethlon, Inc. and Hemex, Inc. Under the plan's terms, Bishop, Inc. issued shares of its common
stock to the stockholders of Aethlon, Inc. and Hemex, Inc. such that Bishop, Inc. then owned 100% of each company. Upon completion
of the transaction, Bishop, Inc. was renamed Aethlon Medical, Inc. Our executive offices are located at 9635 Granite Ridge Drive,
Suite 100, San Diego, California 92123. Our telephone number is (858) 459-7800. All references to &ldquo;us&rdquo; or &ldquo;we&rdquo;
are references to Aethlon Medical, Inc., combined with its subsidiary.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Target Market and Strategy</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in; text-indent: 0.45in">Our primary therapeutic business
segment is directed toward commercializing our Hemopurifier&reg; to address a significant unmet need in global health; the broad-spectrum
treatment of life-threatening highly glycosylated viruses that are not addressed with an already approved antiviral drug agent.
Of the approximate 300 viruses known to be infectious to man, only 9 are addressed with approved antiviral drugs. We also believe
our device can serve as a first-line countermeasure against newly emerging viruses or those that have been genetically engineered
to be agents of bioterrorism. We are not aware of an antiviral drug strategy to combat such threats. We have also demonstrated
that our Hemopurifier&reg; can combine to improve the benefit of an antiviral drug regimen.</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In oncology indications, we have been exploring
the ability of the Hemopurifier&reg; to capture tumor-derived exosomes, which promote cancer progression and seed the spread of
metastasis.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The second facet of our business is conducted
through ESI, which is our diagnostic business segment that is advancing the validation of exosomal biomarkers to diagnose and
monitor life-threatening disease conditions that may be current or future therapeutic targets of Aethlon Medical.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We also pursue grants or contracts with
the U.S. Government. We recently completed two Department of Defense (DOD) contracts with the Defense Advanced Research Projects
Agency (DARPA) that involved the advancement of a device to treat sepsis. In these programs, we competed 29 of 29 milestone tasks,
which resulted in the generation of approximately $5,936,000 in revenue from our primary contract with DARPA over the period October
1, 2011 through September 30, 2016. While both of those contracts are now complete, we intend to conduct further government contract
business in the future.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Our Lead Device: The Aethlon Hemopurifier</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The Aethlon Hemopurifier is a device that
selectively targets the rapid elimination of circulating viruses and tumor-secreted exosomes that promote cancer progression.
More specifically, the Hemopurifier addresses antiviral drug-resistance in Hepatitis C virus and Human Immunodeficiency Virus-infected
individuals; serves as a countermeasure against viral pathogens not addressed by drug or vaccine therapies; and, we believe, represents
the first therapeutic strategy to address cancer promoting exosomes. In clinical studies conducted in India, safety and efficacy
observations of Hemopurifier therapy have been observed in both Hepatitis C virus and Human Immunodeficiency Virus-infected individuals.
We have recently completed the treatment of eight patients in our first U.S. Food and Drug Administration, or FDA, approved study
of Hemopurifier therapy in the U.S. and are preparing our final report on that study for submission to the FDA, as part of our
study reporting responsibilities. .The feasibility study was conducted on Hepatitis C virus (HCV) infected dialysis patients,
which reported that an average capture of 154 million HCV viruses (in International Units, I.U.) within the Hemopurifier during
the four-hour treatments. Early feasibility studies allow for prompt clinical evaluation of devices to provide proof of principle
and initial clinical safety data. This early feasibility study was suggested, because nonclinical methods were not viewed as adequate
to advance the development process and many of the viruses and exomes that the Hemopurifier has the potential to provide clinical
benefit cannot be studied due to ethical reasons. We were granted entry into FDA&rsquo;s Expedited Access Pathway (EAP) Program
on September 8, 2017 which is allowing us to obtain input from FDA as to what indication(s) and studies we should include in our
clinical program to obtain an initial approval of the Hemopurifier as a medical device. The EAP program is a voluntary program
for certain medical devices that demonstrate the potential to address unmet medical needs for life threatening or irreversibly
debilitating diseases or conditions that are subject to premarket approval applications (PMA), premarket notification (510[k])
or requests for De Novo designation. The Hemopurifier is being studied for the treatment of life-threatening broad-spectrum highly
glycosylated viruses that are not addressed with an already approved treatment. It has not yet been established, however, whether
such reduction in viral load will result in an improvement in patient mortality or other clinically- beneficial endpoints for
any disease or condition to meet the criteria for the EAP program.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>The Scientific Mechanism of the Hemopurifier</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.5in">The Hemopurifier is an extracorporeal
device designed for the single-use removal of viruses, viral toxins, and deleterious exosomes from the circulatory system of treated
patients. Delivery of Hemopurifier therapy can occur through the established infrastructure of continuous renal replacement therapy
and dialysis instruments routinely found in hospitals and clinics worldwide. Many extracorporeal techniques, such as dialysis
or plasmapheresis, are designed to remove circulating particles solely by molecule size. However, the Hemopurifier incorporates
a lectin affinity agent that is designed to bind to a unique high mannose signature that is abundant on the surface of tumor-derived
exosomes and glycoproteins that reside on the outer membrane of infectious viruses. The Hemopurifier is designed to provide a
broad-spectrum treatment against life-threatening highly glycosylated viruses that are not addressed with an already approved
treatment to inhibit the presence of certain cancer and infectious disease related particles. A single treatment with the Hemopurifier
can last from three to six and one half hours in duration.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>The Hemopurifier - U.S. Clinical Trials</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.5in">On March 13, 2017, we disclosed
that we concluded an FDA approved feasibility study of Hemopurifier therapy, which demonstrated safety of our device in health
-compromised individuals infected with a viral pathogen as a model to suggest the potential of our device as a broad-spectrum
treatment against life-threatening highly glycosylated viruses that are not addressed with an already approved treatment countermeasure
against infectious viral pathogens, where a reduction in viral load would be deemed beneficial to improve patient mortality or
another clinically-beneficial endpoint. More specifically, the feasibility study was conducted on Hepatitis C virus (HCV) -infected
dialysis patients at DaVita MedCenter Dialysis in Houston, Texas. The principal investigator of the study was Dr. Ronald Ralph.
We reported that there were no device-related adverse events in the eight enrolled subjects who met the study inclusion-exclusion
criteria. We also reported that an average capture of 154 million HCV viruses (in International Units, I.U.) within the Hemopurifier&reg;
during 4-hour treatments.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.5in">On August 11, 2017, we submitted
an Expedited Access Pathway (EAP) program submission to the FDA, which included a request for a &ldquo;Breakthrough Technology&rdquo;
designation, which was established under the 21<SUP>st</SUP> Century Cures Act signed into law in 2016. The proposed indications
for use includes &quot;The Hemopurifier is a single-use device indicated for the treatment of life-threatening highly glycosylated
viruses that are not addressed with an approved treatment,&quot; and on September 8, 2017, we received a letter from the FDA informing
us that our combination product and proposed indication for use meets the criteria and has been granted EAP designation. Through
this program, we will work collaboratively with FDA to design a data development plan and regulatory pathway intended to achieve
FDA-approval of the device, and through this process, we believe the regulatory advancement of our device with the FDA will be
accelerated.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.5in">Additionally, we are advancing
the Hemopurifier&reg; for the broad-spectrum treatment of life-threatening highly glycosylated viruses that are not addressed
with an already approved treatment to fulfill the treatment objectives of the 2016 Public Health Emergency Medical Countermeasure
Enterprise (PHEMCE), which defines the plan of the U.S. government to protect citizens against bioterror and pandemic threats.
Based on preclinical and early-phase or feasibility clinical studies, we believe the Hemopurifier&reg; has the potential to treat
broad-spectrum life-threatening highly glycosylated viruses that are not addressed with an already approved treatment as a treatment
countermeasure. Our goal would be for our device to be procured by the U.S. government for the strategic national stockpile. Currently,
we have not begun discussions for inclusion in the strategic national stockpile.</P>



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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>The Hemopurifier - Antiviral Studies in India</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Previously, we conducted Hepatitis C virus
treatment studies at the Apollo Hospital, Fortis Hospital, and most recently the Medanta Medicity Institute in India.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In the Medanta Medicity Institute study,
twelve Hepatitis C virus-infected individuals were enrolled to receive three six-hour Hemopurifier treatments during the first
three days of a 48-week peginterferon+ribavirin treatment regimen. The study was conducted under the leadership of Dr. Vijay Kher
at the Medanta Medicity Institute, a multi-specialty medical institute established to be a premier center for medical tourism
in India. Dr. Kher&rsquo;s staff reported that Hemopurifier therapy was well tolerated and without device-related adverse events
in the twelve treated patients.</P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Of these twelve patients, ten completed
the Hemopurifier-peginterferon+ribavirin treatment protocol, including eight genotype-1 patients and two genotype-3 patients.
Eight of the ten patients achieved a sustained virologic response, which is the clinical definition of treatment cure and is defined
as undetectable Hepatitis C virus in the blood 24 weeks after the completion of the 48-week peginterferon+ribavirin drug regimen.
Both genotype-3 patients achieved a sustained virologic response, while six of the eight genotype-1 patients achieved a sustained
virologic response.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Of the ten patients who completed the full
treatment protocol, five also achieved a rapid virologic response, defined as undetectable Hepatitis C virus in the blood at day
30 of therapy. Rapid virologic response represents the clinical endpoint that best predicts sustained virologic response cure
rates resulting from peginterferon+ribavirin therapy. As a point of reference, the landmark Individualized Dosing Efficacy vs
Flat Dosing to Assess Optimal Pegylated Interferon Therapy study of 3,070 Hepatitis C virus genotype-1 patients documented that
10.35% (n=318/3070) of peginterferon+ribavirin-treated patients achieved a rapid virologic response. Patients who achieved a rapid
virologic response had sustained virologic response rates of 86.2% (n=274/318) versus sustained virologic response rates of 32.5%
(n=897/2752) in non-rapid virologic response patients. Two of the genotype-1 patients who achieved a rapid virologic response
also achieved an immediate virologic response, defined as undetectable Hepatitis C virus in the blood seven days after initiation
of Hemopurifier-peginterferon+ribavirin treatment protocol. The earliest measured report of undetectable Hepatitis C virus in
blood in the Individualized Dosing Efficacy vs Flat Dosing to Assess Optimal Pegylated Interferon Therapy study was on day 14
of the study.</P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Data from two patients was not included
in the reported Hemopurifier-peginterferon+ribavirin dataset. One of these patients was a genotype-5 patient who discontinued
peginterferon+ribavirin therapy at day 180, yet still achieved a sustained virologic response. The second patient was a genotype-3
patient who also achieved a sustained virologic response, yet was unable to tolerate peginterferon+ribavirin therapy and discontinued
therapy at day-90. Overall, ten of the twelve patients who enrolled in the study achieved a sustained virologic response and seven
of the twelve patients achieved a rapid virologic response.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>EBOLA Virus</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Time Magazine named the Hemopurifier&reg;
to be a &ldquo;Top 25 Invention&rdquo; as the result of treating an ebola-infected physician at Frankfurt University Hospital
in Germany. The physician was comatose with multiple organ failure at the time of treatment with the Hemopurifier&reg;. At the
American Society of Nephrology Annual Meeting, Dr. Helmut Geiger, Chief of Nephrology at Frankfurt University Hospital reported
that the patient received a single 6.5 hour Hemopurifier&reg; treatment. Prior to treatment, viral load was measured at 400,000
c/ml. Post-treatment viral load at reported to be 1,000 c/ml. Dr. Geiger also reported that 242 million copies of Ebola virus
were measured to be captured within the Hemopurifier&reg; during treatment. The patient made a full recovery.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Hemopurifier - Human Immunodeficiency Virus; Single Proof
Study</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In addition to treating Hepatitis C virus-infected
individuals, we have conducted a single proof-of-principle treatment study related to the treatment of Human Immunodeficiency
Virus. In the study, Hemopurifier therapy reduced viral load by 93% in a Human Immunodeficiency Virus-Acquired Immunodeficiency
Syndrome-infected individual without the administration of antiviral drug therapy. The study protocol provided for 12 Hemopurifier
treatments, each four hours in duration, which were administered over the course of one month.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Researchers at the Morehouse School of
Medicine have since discovered that the Hemopurifier is able to capture exosomes that transport negative regulatory factor protein,
which is reported to suppress the immune response in Human Immunodeficiency Virus-infected individuals.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Exosome Sciences, Inc. - Diagnostic Candidates</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Through our majority-owned subsidiary Exosome,
which is our diagnostic product-oriented business segment, we are developing exosome-based product candidates to diagnose and
monitor neurological disorders and cancer. Since it began operations in 2013, Exosome researchers have disclosed that they have
isolated brain-specific biomarkers associated with Alzheimer's Disease and Chronic Traumatic Encephalopathy (CTE). Specific to
CTE, Exosome is participating in a research collaboration with The Boston University CTE Center to study the correlation of a
biomarker known as tausome with CTE.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In January 2017, Exosome announced plans
to initiate a clinical study involving retired NFL players and a data-supported biomarker candidate to detect and monitor CTE
in living individuals. CTE is a neurodegenerative disease that has often been found in American football players, boxers and other
individuals with a history of repetitive head trauma. At present, CTE diagnosis is determined after death through an analysis
of brain tissue.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The goal of the study is to establish a
clinical collaboration with up to 200 former professional football players and clinical investigators at multiple U.S. locations.
If fully enrolled, the study would be the largest to date in former NFL players, who are at a high risk of suffering from CTE.
The goal of the study will be to further validate a CTE biomarker candidate known as plasma exosomal tau, or a TauSomeTM.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Kendall Van Keuren-Jensen, Ph.D., Co-Director
of the Translational Genomics Research Institute's (TGen) Center for Noninvasive Diagnostics in Phoenix, will serve as principal
investigator for the study. Dr. Van Keuren-Jensen is neurodegenerative disease thought leader whose research includes discovery
and detection of biomarkers for central nervous system disorders.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On September 20, 2017, our collaborator,
Translational Genomics Research Institute, received institutional review board approval for our upcoming CTE study on retired
NFL players.&nbsp; The title of the study is &ldquo;The quantification of biomarkers in the blood, urine, and saliva of former
contact sports players and controls.&rdquo; Formal initiation of patient enrollment has yet to be commenced or disclosed.</P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><B>U.S. Government Contract with the Defense
Advanced Research Projects Agency</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On September 30, 2011, we entered into
a $6.8 million multi-year contract with the Defense Advanced Research Projects Agency, or DARPA, part of the Department of Defense,
resulting from our response to a program entitled &ldquo;Dialysis-Like Therapeutics.&rdquo; Under this contract, our tasks include
the development of a dialysis-like device to prevent sepsis, a fatal bloodstream infection that is often the cause of death in
combat-injured soldiers.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The initial award from DARPA was a fixed-price
contract with potential total payments to us of $6,794,389 over the course of five years. As noted below, such contract was subsequently
reduced by $858,469. Fixed price contracts require the achievement of multiple, incremental milestones to receive the full award
during each year of the contract. Under the terms of the contract, we are required to perform certain incremental work towards
the achievement of specific milestones against which we will invoice the government for fixed payment amounts.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Originally, only the base year (year one
of the contract) was effective for the parties, however, DARPA subsequently exercised the option on the second, third and fourth
years of the contract. DARPA has the option to enter into the contract for year five. The milestones are comprised of planning,
engineering and clinical targets, the achievement of which in some cases will require the participation and contribution of third
party participants under the contract. We cannot assure you that we alone, or with third party participants, will meet such milestones
to the satisfaction of the government and in compliance with the terms of the contract or that we will be paid the full amount
of the contract revenues during any year of the remaining contract term. We cannot assure you that DARPA will exercise its option
to continue the contract for year five. We commenced work under the contract in October 2011.</P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In February 2014, DARPA reduced the scope
of our contract in years three through five of the contract. The reduction in scope focused our research on exosomes, viruses
and blood processing instrumentation. This scope reduction will reduce the possible payments under the contract by $858,469 over
years three through five.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The DARPA contract required us to perform
certain scientific research and development activities geared toward the achievement of specific milestones set forth in the contract.
In the fiscal year ended March 31, 2017, we invoiced the U.S. Government for the final two milestones under our DARPA contract
in the aggregate amount of $387,438. In the fiscal year ended March 31, 2016, we invoiced the U.S. Government for four milestones
under our DARPA contract in the amount of $863,011. As the DARPA contract was completed on September 30, 2016, we do not expect
to record any future revenue related to that contract.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Subcontract with Battelle Memorial Institute</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We entered into a subcontract agreement
with Battelle in March 2013. Battelle was chosen by DARPA to be the prime contractor on the systems integration portion of the
original DARPA contract, and we were one of several subcontractors on that systems integration project. The Battelle subcontract
was under a time and materials basis, and we began generating revenues under the subcontract in the three months ended September
30, 2013. That contract has now concluded. The Battelle subcontract was our first cost-reimbursable contract.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our revenue under this contract was a function
of cost reimbursement plus an overhead mark-up for hours devoted to the project by specific employees (with specific hourly rates
for those employees), for travel expenses related to the project, for any equipment purchased for the project and for the cost
of any consultants hired by us to perform work on the project. Each payment required approval by the program manager at Battelle.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Research and Development Costs</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">A substantial portion of our operating
budget is used for research and development activities. The cost of research and development, all of which has been charged to
operations, amounted to approximately $673,000 and $782,000 in the fiscal years ended March 31, 2017 and 2016, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Intellectual Property</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We currently own or have license rights
to a number of U.S. and foreign patents and patent applications and endeavor to continually improve our intellectual property
position. We consider the protection of our technology, whether owned or licensed, to the exclusion of use by others, to be vital
to our business. While we intend to focus primarily on patented or patentable technology, we may also rely on trade secrets, unpatented
property, know-how, regulatory exclusivity, patent extensions and continuing technological innovation to develop our competitive
position. We also own certain trademarks.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Patents</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have been exclusively assigned all rights
and title to and interest in an invention and related worldwide patent rights for a method to treat cancer under an assignment
agreement with the London Health Science Center Research, Inc. The invention provides for the &quot;Depression of anticancer immunity
through extracorporeal removal of microvesicular particles&quot; (including exosomes) for which the U.S. Patent and Trademark
Office issued a patent in 2012 (patent #8,288,172) and for which we have filed additional patent applications domestically and
abroad (patent applications #US13/623662, #US14/180093, #US14/185033, #EP7,752,778.6, #HK9,104,740.6, #IN8139/DELNP/2008 and #CA2644855).
Please see the tables below for more information regarding these patents and patent applications.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The agreement provides for an upfront payment
of 800 shares of restricted common stock and a 2% royalty on any future net sales. We are also responsible for paying certain
patent application and filing costs. Under the assignment agreement, the London Health Science Center Research, Inc. sold and
assigned all of its rights, title and interest in the worldwide patents to us.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The following table lists all of our issued
patents and patent applications, including their ownership status:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt"><B>Patents Issued in
the United States</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: center; margin-bottom: 0pt"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: Black 1pt solid">PATENT #</TD>
    <TD STYLE="padding-bottom: 1pt; border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">PATENT NAME</TD><TD STYLE="padding-bottom: 1pt; border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="text-align: center; border-bottom: Black 1pt solid">ISSUANCE<BR>
    DATE</TD><TD STYLE="padding-bottom: 1pt; border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="text-align: center; border-bottom: Black 1pt solid">OWNED<BR>
    OR<BR>
    LICENSED</TD><TD STYLE="padding-bottom: 1pt; border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="text-align: center; border-bottom: Black 1pt solid">EXPIRATION<BR>
    DATE</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: left"></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center"></TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 13%">9,707,333</TD>
    <TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 49%; text-align: left">Extracorporeal removal of microvesicular particles</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 11%; text-align: center">7/18/17</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 11%; text-align: center">Owned</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 11%; text-align: center">10/2/29</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>9,364,601</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: left">Extracorporeal removal of microvesicular particles</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">6/14/16</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Owned</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">10/2/29</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>8,288,172</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: left">Extracorporeal removal of microvesicular particles (exosomes) (method patent)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">10/16/12</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Owned</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">3/30/29</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>7,226,429</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: left">Method for removal of viruses from blood by lectin affinity hemodialysis</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">6/5/07</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Owned</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">1/20/24</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>6,528,057</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: left">Method for removal of HIV and other viruses from blood</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">3/4/03</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Licensed</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">8/30/19</TD></TR>
</TABLE>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: center; margin-bottom: 0pt"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>





<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Patent Applications in the United States</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">OWNED</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD></TD><TD>&nbsp;</TD>
    <TD></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">FILING</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">OR</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="border-bottom: Black 1pt solid">APPLICATION #</TD><TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">APPLICATION NAME</TD><TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: center">DATE</TD><TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: center">LICENSED</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 13%; text-align: left">15/121736</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 55%; text-align: left">Brain specific exosome based diagnostics and extracorporeal therapies</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 13%; text-align: center">8/25/16</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 13%; text-align: center">Owned</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">62/541538</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">Multiplex cerebrospinal fluid processing system</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">8/04/17</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Owned</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">14/856361</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">Device and method for purifying virally infected blood</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">9/16/15</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Owned</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">14/790684</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">Affinity capture of circulating biomarkers</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">7/02/15</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Owned</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">14/490418</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">Method for removal of viruses from blood by lectin affinity hemodialysis</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">9/18/14</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Owned</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">14/185033</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">Extracorporeal removal of microvesicular particles</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">2/20/14</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Owned</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">13/808561</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">Methods and compositions for quantifying exosomes</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">8/14/13</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Owned</TD></TR>
</TABLE>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Foreign Patents</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: Black 1pt solid">PATENT #</TD><TD STYLE="padding-bottom: 1pt; border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">PATENT NAME</TD><TD STYLE="padding-bottom: 1pt; border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: center">ISSUANCE<BR>
    DATE</TD><TD STYLE="padding-bottom: 1pt; border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="text-align: center; border-bottom: Black 1pt solid">OWNED OR <BR>LICENSED</TD><TD STYLE="padding-bottom: 1pt; border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: center">EXPIRATION<BR>
    DATE</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 13%; text-align: left">2353399</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 52%; text-align: left">Method for removal of viruses from blood by lectin affinity hemodialysis (Russia)</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 9%; text-align: center">4/27/09</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 9%; text-align: center">Owned</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 9%; text-align: center">1/20/24</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">770344</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">Method for removal of HIV and other viruses from blood (Australia)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">6/3/04</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Licensed</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">8/30/19</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">DE69929986</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">Method for removal of HIV and other viruses from blood (Germany)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">2/22/06</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Licensed</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">8/30/19</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">1109564</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">Method for removal of HIV and other viruses from blood (France)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">2/22/06</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Licensed</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">8/30/19</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">1109564</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">Method for removal of HIV and other viruses from blood (Great Britain)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">2/22/06</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Licensed</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">8/30/19</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">1109564</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">Method for removal of HIV and other viruses from blood (Italy)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">2/22/06</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Licensed</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">8/30/19</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">2342203</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">Method for removal of HIV and other viruses from blood (Canada)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">3/1/11</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Licensed</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">8/30/19</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">1624785</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">Method for removal of viruses from blood by lectin affinity hemodialysis (Belgium)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">7/17/13</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Owned</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">1/20/24</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">1624785</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">Method for removal of viruses from blood by lectin affinity hemodialysis (Ireland)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">7/17/13</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Owned</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">1/20/24</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">1624785</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">Method for removal of viruses from blood by lectin affinity hemodialysis (Italy)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">7/17/13</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Owned</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">1/20/24</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">1624785</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">Method for removal of viruses from blood by lectin affinity hemodialysis (Great Britain)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">7/17/13</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Owned</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">1/20/24</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">1624785</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">Method for removal of viruses from blood by lectin affinity hemodialysis (France)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">7/17/13</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Owned</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">1/20/24</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">1624785</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">Method for removal of viruses from blood by lectin affinity hemodialysis (Germany)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">7/17/13</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Owned</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">1/20/24</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">2516403</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">Method for removal of viruses from blood by lectin affinity hemodialysis (Canada)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">8/12/14</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Owned</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">1/20/24</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">2591359</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">Methods for quantifying exosomes (Germany)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">3/01/17</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Owned</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">7/07/31</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">2591359</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">Methods for quantifying exosomes (France)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">3/01/17</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Owned</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">7/07/31</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">2591359</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">Methods for quantifying exosomes (Great Britain)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">3/01/17</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Owned</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">7/07/31</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">2591359</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">Methods for quantifying exosomes (Spain)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">3/01/17</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Owned</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">7/07/31</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Foreign Patent Applications</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: right">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">FILING</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">OWNED OR</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: Black 1pt solid">APPLICATION #</TD><TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">APPLICATION NAME</TD><TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="text-align: center; border-bottom: Black 1pt solid">DATE</TD><TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="text-align: center; border-bottom: Black 1pt solid">LICENSED</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>EP20070752778</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">Extracorporeal removal of microvesicular particles (exosomes) (Europe)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">3/9/07</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Owned</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 13%; text-align: left">9,104,740.6</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 55%; text-align: left">Extracorporeal removal of microvesicular particles (exosomes) (Hong Kong)</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 13%; text-align: center">3/9/07</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 13%; text-align: center">Owned</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">8139/DELNP/2008</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">Extracorporeal removal of microvesicular particles (exosomes) (India)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">3/9/07</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Owned</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">2644855</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">Extracorporeal removal of microvesicular particles (Canada)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">3/9/07</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Owned</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>EP20110804372</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">Methods and compositions for quantifying exosomes (Europe)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">7/7/11</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Owned</TD></TR>
</TABLE>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>





<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>International Patent Applications</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 25%; border-bottom: Black 1pt solid"><BR>
    <FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">APPLICATION # </FONT></TD>
    <TD STYLE="width: 25%; border-bottom: Black 1pt solid"><BR>
    <FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">APPLICATION NAME</FONT></TD>
    <TD STYLE="width: 25%; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">FILING
    </FONT><BR>
    <FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">DATE</FONT></TD>
    <TD STYLE="width: 25%; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">OWNED
    OR </FONT><BR>
    <FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">LICENSED</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">PCT/US2016/062194</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Exosomal tau as a biomarker for brain disorders</FONT></TD>
    <TD STYLE="text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">11/16/16</FONT></TD>
    <TD STYLE="text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Owned</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">PCT/US2016/ 028482</FONT></TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Methods for delivering regional citrate anticoagulation
    during extracorporeal blood treatments</FONT></TD>
    <TD STYLE="text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">4/20/16</FONT></TD>
    <TD STYLE="text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Owned</FONT></TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We expect that our ability to enforce our
patents and proprietary rights in many countries will be adversely impacted due to possible changes in law, our lack of familiarity
with foreign law, or our lack of professional resources in jurisdictions outside the U.S. We cannot guarantee that any patents
issued or licensed to us, including within the U.S., will provide us with competitive advantages or will not be challenged by
others, or will not expire prior to our successful commercialization of our products. Furthermore, we cannot be certain that others
will not independently develop similar products or will not design around patents issued or licensed to us. We cannot guarantee
that patents that are issued will not be challenged, invalidated or infringed upon or designed around by others, or that the claims
contained in such patents will not infringe the patent claims of others, or provide us with significant protection against competitive
products, or otherwise be commercially valuable. We may need to acquire licenses under patents belonging to others for technology
potentially useful or necessary to us. If any such licenses are required, we cannot be certain that they will be available on
terms acceptable to us, if at all. To the extent that we are unable to obtain patent protection for our products or technology,
our business may be materially adversely affected by competitors who develop substantially equivalent technology.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Trademarks</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have obtained registered trademarks
in the U.S. for the marks Exosome Sciences&reg;, Hemopurifier and Aethlon Medical, Inc. and have applied for the Tausome trademark
in the U.S., which application is currently pending. We have applied for trademark protection on Hemopurifier in India and that
application is currently pending. We also have common law trademark rights in Aethlon ADAPTTM and ELLSATM.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Licensing and Assignment Agreements</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Effective January 1, 2000, we entered into
an agreement with a related party (HEMEX) under which an invention and related patent rights for a method of removing Human Immunodeficiency
and other viruses from the blood using the Hemopurifier were assigned to us by the inventors in exchange for an 8.75% royalty
to be paid on future net sales of the patented product or process and shares of our common stock. On March 4, 2003, the related
patent (patent #6,528,057) was issued and we issued 3,922 shares of restricted common stock to that related party. The license
runs for the life of the patent, which expires in August 2019.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 6pt"><P STYLE="margin: 0pt">&nbsp;</P></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On November 7, 2006, we entered into an
exclusive assignment agreement with the London Health Science Center Research, Inc. under which an invention and related patent
rights for a method to treat cancer were assigned to us. The invention provides for the &quot;Extracorporeal removal of microvesicular
particles&quot; for which the U.S. Patent and Trademark Office allowed a patent (patent #8,288,172) in the U.S. as of October
2012. The agreement provides for an upfront payment of 800 shares of restricted common stock and a 2% royalty on any future net
sales. We are also responsible for paying certain patent application and filing costs. Under the assignment agreement, we own
the patents outright for the life of the patent, which expires in March 2029. Under certain circumstances, ownership of the patents
may revert back to the London Health Science Center Research, Inc. if there is an uncured substantial breach of the assignment
agreement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Industry</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The industry for treating infectious disease
and cancer is extremely competitive, and companies developing new treatment procedures face significant capital and regulatory
challenges. Additionally, as the Hemopurifier is a new device, we have the additional challenge of establishing medical industry
support, which will be driven by treatment data resulting from clinical studies of each disease condition that we pursue. The
industry includes pharmaceutical companies and medical device companies competing to treat illnesses on a worldwide basis.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Competition</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We are advancing our Hemopurifier as a
treatment strategy to enhance and prolong current drug therapies by removing the viral strains that cause drug resistance. We
are also advancing the Hemopurifier as a tool for cancer treatment in conjunction with existing, and to be developed, cancer therapies.
The Hemopurifier also may prolong life for infected patients who have become drug resistant or have been infected with a viral
pathogen for which there is no drug or vaccine therapy. We believe our Hemopurifier augments the benefit of drug therapies and
should not be considered a competitor to such treatments. However, if the industry considered the Hemopurifier to be a potential
replacement for drug therapy, or a device that limited the need or volume of existing drug therapies, then the marketplace for
the Hemopurifier would be extremely competitive. We believe our Hemopurifier is the sole therapeutic device able to selectively
remove viruses and immunosuppressive proteins from circulation. However, we are aware that Asahi Kasei Kurary Medical based in
Japan has created a double filtration plasmapheresis system that indiscriminately removes particles from blood in a certain molecule
range that includes Hepatitis C virus. Asahi Kasei Kurary Medical is now marketing this device in Japan as an adjunct therapy
for Hepatitis C virus. We may also face competition from producers of antiviral drugs and vaccines.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>





<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Government Regulation of Medical Devices</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The Hemopurifier is subject to regulation
by numerous regulatory bodies, primarily the FDA, and comparable international regulatory agencies. These agencies require manufacturers
of medical devices to comply with applicable laws and regulations governing the development, testing, manufacturing, labeling,
marketing, storage, distribution, advertising and promotion, and post-marketing surveillance reporting of medical devices. Devices
are generally subject to varying levels of regulatory control, the most comprehensive of which requires that a clinical evaluation
program be conducted before a device receives approval for commercial distribution. Failure to obtain approval or clearance to
market our product and products under development and to meet the ongoing requirements of these regulatory authorities could prevent
us from commercializing the Hemopurifier and future products in the U.S. and elsewhere.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Hemopurifier Investigational Device Exemption and Supplement</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In 2013, the FDA approved our investigational
device exemption to initiate human clinical studies in the U.S. as a feasibility study. We were required to reach agreement with
the internal review board of DaVita MedCenter Dialysis prior to beginning our U.S. clinical trial. We are also required to obtain
patients' informed consent that complies with both FDA requirements and state and federal privacy regulations. We, the FDA or
the internal review board at each site at which a clinical trial is being performed may suspend a clinical trial at any time for
various reasons, including a belief that the risks to study subjects outweigh the benefits. Even if a trial is completed, the
results of clinical testing may not demonstrate the safety and efficacy of the device, may be equivocal or may otherwise not be
sufficient to obtain approval of the product. The investigational device exemption is part of the FDA&rsquo;s approval process.
This process is discussed in detail in the &ldquo;Pre-Marketing Regulations in the U.S.&rdquo; section below.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In December 2014, the FDA approved our
request for a supplement to our investigational device exemption to establish a protocol to clinically investigate the use of
the Hemopurifier for the treatment of Ebola-infected patients in the U.S. Under the supplement, we may treat up to 20 Ebola-infected
persons, at no more than 10 institutions in the U.S., using the supplement protocol; however, this is not a clinical trial. We
must clearly distinguish data collected in the supplement protocol from data collected in our chronic Hepatitis C virus clinical
trial (discussed above). Prior to treating Ebola-infected patients, we must comply with specified patient protection procedures
established by the applicable institution including its institutional review board. Also, we must report any unanticipated adverse
events resulting from the supplement protocol to the FDA within 10 working days. Even if the protocol is established, and patients
are treated, the results of such treatments may not demonstrate the safety and efficacy of the device. In addition, we cannot
assure you that any Ebola-infected individuals will be treated under this protocol.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">DaVita MedCenter Dialysis treated a total
of eight patients per the protocol under our clinical trial and then notified us that it was unlikely that they would be able
to locate additional HCV patients undergoing dialysis to treat as part of the trial. Therefore on April 11, 2017, we notified
the FDA that we were concluding the trial with the eight patients treated. The FDA accepted that decision to terminate the trial
with eight patients completed. We have six months to complete and submit the final report on the trial to the FDA.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Pre-Marketing Regulations in the U.S.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Unless an exemption applies, each medical
device distributed commercially in the United States requires either prior 510(k) clearance or premarket approval, or PMA, from
the FDA. The FDA classifies medical devices into one of three classes. Class I devices are subject to only general controls, such
as establishment registration and device listing, labeling, medical device reporting, and prohibitions against adulteration and
misbranding. Class II medical devices generally require prior 510(k) clearance before they may be commercially marketed in the
United States. Devices deemed by the FDA to pose the greatest risk, such as life-sustaining, life-supporting or implantable devices,
or devices deemed not substantially equivalent to a predicate device, are placed in Class III, generally requiring submission
of a PMA supported by clinical trial data. Our Hemopurifier is a Class III product, and we believe that products utilizing our
Aethlon ADAPTTM system will be considered to be Class III products and thus will require submission and approval of a PMA. In
the future, we may develop new products that are considered to be Class II and require the clearance of a 510(k).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><I>510(k) Clearance Pathway</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">To obtain 510(k) clearance, a premarket
notification must be submitted to FDA demonstrating that the proposed device is substantially equivalent to a previously cleared
510(k) device or a device that was in commercial distribution before May 28, 1976 for which the FDA has not yet called for the
submission of premarket approval applications. FDA&rsquo;s 510(k) clearance pathway usually takes from three to twelve months,
but it can take significantly longer. The FDA may require additional information, including clinical data, to make a determination
regarding substantial equivalence.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">After a device receives 510(k) clearance,
any modification that could significantly affect its safety or effectiveness, or that would constitute a new or major change in
its intended use, will require a new 510(k) clearance or, depending on the modification, require premarket approval. The FDA requires
each manufacturer to determine whether the proposed change requires submission of a 510(k), or a premarket approval, but the FDA
can review any such decision and can disagree with a manufacturer&rsquo;s determination. If the FDA disagrees with a manufacturer&rsquo;s
determination, the FDA can require the manufacturer to cease marketing and/or recall the modified device until 510(k) clearance
or premarket approval is obtained. If the FDA requires a 510(k) holder to seek 510(k) clearance or premarket approval for any
modifications to a previously cleared product, the 510(k) holder also may be required to cease marketing or recall the modified
device until this clearance or approval is obtained.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>





<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><I>Premarket Approval Pathway</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">A PMA must be supported by extensive data,
including but not limited to data obtained from technical, preclinical and clinical studies and relating to manufacturing and
labeling to demonstrate to the FDA&rsquo;s satisfaction the safety and effectiveness of the device.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">After a PMA submission is sufficiently
complete, the FDA will accept the application and begin an in-depth review, which generally takes between one and three years,
but may take significantly longer. During this review period, the FDA will typically request additional information or clarification
of the information already provided. Also, an advisory panel of experts from outside the FDA may be convened to review and evaluate
the application and provide recommendations to the FDA as to the approvability of the device. The FDA may or may not accept the
panel&rsquo;s recommendation. In addition, the FDA will conduct a pre-approval inspection of the manufacturing facility to ensure
compliance with Quality System Regulation, or QSR. New PMA applications or PMA supplements are required for modifications that
affect the safety or effectiveness of the device, including, for example, certain types of modifications to the device&rsquo;s
indication for use, manufacturing process, labeling and design. PMA supplements often require submission of the same type of information
as a PMA application, except that the supplement is limited to information needed to support any changes from the device covered
by the original PMA application and may not require as extensive clinical data or the convening of an advisory panel.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><I>Clinical Trials</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Clinical trials are almost always required
to support a PMA. To perform a clinical trial in the United States for a significant risk device, FDA requires the device sponsor
to file an Investigational Device Exemption, or IDE, application with the FDA and obtain IDE approval prior to commencing the
human clinical trial. An IDE amendment or supplement must also be submitted before initiating a significant change to the clinical
protocol or device under an existing IDE. The IDE application must be supported by appropriate data, such as animal and laboratory
testing results, and any available data on human clinical experience, showing that it is safe to test the device in humans and
that the testing protocol is scientifically sound.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The IDE must be approved in advance by
the FDA for a specific number of patients. Clinical trials conducted in the U.S. for significant risk devices may begin once the
IDE application is approved by the FDA and the appropriate institutional review boards, or IRBs, overseeing the welfare of the
research subjects and responsible for that particular clinical trial. Under its regulations, the FDA responds to an IDE or an
IDE amendment within 30 days. The FDA may approve the IDE or amendment, grant an approval with certain conditions, or identify
deficiencies and request additional information. It is common for the FDA to require additional information before approving an
IDE or amendment for a new trial, and thus final FDA approval on a submission may require more than the initial 30 days. The FDA
may also require that a small-scale feasibility study be conducted before a pivotal trial may commence. In a feasibility trial,
the FDA limits the number of patients, sites and investigators that may participate. Feasibility trials are typically structured
to obtain information on safety and to help determine how large a pivotal trial should be to obtain statistically significant
results.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Clinical trials are subject to extensive
recordkeeping and reporting requirements. Our clinical trials must be conducted under the oversight of an IRB for the relevant
clinical trial sites and must comply with FDA regulations, including but not limited to those relating to good clinical practices.
We are also required to obtain the patients&rsquo; informed consent in form and substance that complies with both FDA requirements
and state and federal privacy and human subject protection regulations. We, the FDA or the IRB may suspend a clinical trial at
any time for various reasons, including a belief that the risks to study subjects outweigh the anticipated benefits. Even if a
trial is completed, the results of clinical testing may not adequately demonstrate the safety and effectiveness of the device
or may otherwise not be sufficient to obtain FDA approval to market the product in the U.S.</P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Expedited Access Pathway</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On August 11, 2017, we submitted an Expedited
Access Pathway (EAP) program submission to the FDA, which included a request for a &ldquo;Breakthrough Technology&rdquo; designation,
which was established under the 21<SUP>st</SUP> Century Cures Act signed into law in 2016. The proposed indications for use includes
&quot;The Hemopurifier is a single-use device indicated for the treatment of life-threatening highly glycosylated viruses that
are not addressed with an approved treatment,&quot; and on September 8, 2017, we received a letter from the FDA informing us that
our combination product and proposed indication for use meets the criteria and has been granted EAP designation. Through this
program, we will work collaboratively with FDA to design a data development plan and regulatory pathway intended to achieve FDA-approval
of the device, and through this process, we believe the regulatory advancement of our device with the FDA will be accelerated.
The EAP program is a voluntary program for certain medical devices that demonstrate the potential to address unmet medical needs
for life threatening or irreversibly debilitating diseases or conditions that are subject to PMAs, premarket notification (510[k])
or requests for De Novo designation. Under EAP, the FDA works with device sponsors to try to reduce the time and cost from development
to marketing decision without changing the FDA's PMA approval standard of reasonable assurance of safety and effectiveness, the
standards for granting De Novo requests, or any other standards of valid scientific evidence we should include in our clinical
program to obtain an initial approval of the Hemopurifier as a medical device. The Hemopurifier is being studied for the treatment
of life-threatening broad-spectrum highly glycosylated viruses that are not addressed with an already approved treatment. It has
not yet been established, however, whether such reduction in viral load will result in an improvement in patient mortality or
other clinically- beneficial endpoints for any disease or condition to meet the criteria for the EAP program.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>





<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Post-Marketing Regulations in the U.S.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Should our Hemopurifier device be approved
for market use in the U.S. by the FDA, numerous regulatory requirements continue to apply. These include:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>the FDA's
                                         Quality System Regulation which requires manufacturers, including third-party manufacturers,
                                         to follow stringent design, testing, control, documentation and other quality assurance
                                         procedures during all aspects of the manufacturing process;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>labeling
                                         regulations and FDA prohibitions against the promotion of products for un-cleared, unapproved
                                         or off-label uses;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>clearance
                                         or approval of product modifications that could significantly affect safety or efficacy
                                         or that would constitute a major change in intended use;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">medical
                                         device reporting regulations, which require that manufacturers report to the FDA if their
                                         device may have caused or contributed to a death or serious injury or malfunctioned in
                                         a way that would likely cause or contribute to a death or serious injury if the malfunction
                                         were to recur;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>product
                                         listing and establishment registration, which helps facilitate FDA inspections and other
                                         regulatory action; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>post-market
                                         surveillance regulations, which apply when necessary to protect the public health or
                                         to provide additional safety and effectiveness data for the device.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The regulations also require that we report
to the FDA any incident in which our product may have caused or contributed to a death or serious injury or in which our product
malfunctioned and, if the malfunction were to recur, would likely cause or contribute to death or serious injury.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We will also be required to register with
FDA as a medical device manufacturer within 30 days of commercial distribution of our products and must obtain all necessary state
permits or licenses to operate our business. As a manufacturer, we are subject to announced and unannounced inspections by FDA
to determine our compliance with quality system regulation and other regulations, and these inspections may include the manufacturing
facilities of our suppliers. Failure by us or by our suppliers to comply with applicable regulatory requirements can result in
enforcement action by the FDA or state authorities, which may include any of the following sanctions:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD>untitled letters, warning letters, fines, injunctions, consent decrees and civil penalties;</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD>unanticipated expenditures to address or defend such actions;</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD>customer notifications for repair, replacement, refunds;</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD>recall, detention or seizure of our products;</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD>operating restrictions or partial suspension or total shutdown of production;</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD>refusing or delaying our requests for premarket approval of new products or modified products;</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD>operating restrictions;</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD>withdrawing PMA approvals that have already been granted;</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD>refusal to grant export approval for our products; or</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD>criminal prosecution.</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt"><B>Compliance with
U.S. Health Care Laws</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We must comply with various U.S. federal
and state laws, rules and regulations pertaining to healthcare fraud and abuse, including anti-kickback regulations, as well as
other healthcare laws in connection with the commercialization of our products. Fraud and abuse laws are interpreted broadly and
enforced aggressively by various state and federal agencies, including the U.S. Department of Justice, the U.S. Office of Inspector
General for the Department of Health and Human Services and various state agencies.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The U.S. federal Anti-Kickback Statute,
42 U.S.C. &sect;&nbsp;1320a-7b, prohibits persons, including a medical device manufacturer (or a party acting on its behalf),
from knowingly or willfully soliciting, receiving, offering or paying remuneration, directly or indirectly, in exchange for or
to induce either the referral of an individual for a service or product or the purchasing, ordering, arranging for, or recommending
the ordering of, any service or product for which payment may be made by Medicare, Medicaid or any other federal healthcare program.
This statute has been interpreted to apply to arrangements between medical device manufacturers on one hand and healthcare providers
on the other. The term &ldquo;remuneration&rdquo; is not defined in the federal Anti-Kickback Statute and has been broadly interpreted
to include anything of value, such as cash payments, gifts or gift certificates, discounts, waiver of payments, credit arrangements,
ownership interests, the furnishing of services, supplies or equipment, and the provision of anything at less than its fair market
value. Courts have broadly interpreted the scope of the law, holding that it may be violated if merely one purpose of an arrangement
is to induce referrals, irrespective of the existence of other legitimate purposes. The Anti-Kickback Statute prohibits many arrangements
and practices that are lawful in businesses outside of the healthcare industry. Although there are a number of statutory exemptions
and regulatory safe harbors protecting certain business arrangements from prosecution, the exemptions and safe harbors are drawn
narrowly, and practices that involve remuneration intended to induce prescribing, purchasing or recommending may be subject to
scrutiny if they do not qualify for an exemption or safe harbor. Our practices may not in all cases meet all of the criteria for
safe harbor protection from federal Anti-Kickback Statute liability. The reach of the Anti-Kickback Statute was broadened by the
recently enacted Patient Protection and Affordable Care Act of 2010 and the Health Care and Education Affordability Reconciliation
Act of 2010, collectively, the Affordable Care Act or ACA, which, among other things, amends the intent requirement of the federal
Anti-Kickback Statute such that a person or entity no longer needs to have actual knowledge of the statute or specific intent
to violate it in order to have committed a violation. In addition, the ACA provides that the government may assert that a claim
including items or services resulting from a violation of the federal Anti-Kickback Statute constitutes a false or fraudulent
claim for purposes of the federal False Claims Act (discussed below) or the civil monetary penalties statute, which imposes fines
against any person who is determined to have presented or caused to be presented claims to a federal healthcare program that the
person knows or should know is for an item or service that was not provided as claimed or is false or fraudulent. In addition
to the federal Anti-Kickback Statute, many states have their own anti-kickback laws. Often, these laws closely follow the language
of the federal law, although they do not always have the same scope, exceptions, safe harbors or sanctions. In some states, these
anti-kickback laws apply not only to payments made by government healthcare programs but also to payments made by other third-party
payors, including commercial insurance companies.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We may also be subject to various federal
and state marketing laws, such as the federal Physician Payments Sunshine Act, which generally require certain types of expenditures
in the United States and the particular states to be tracked and reported. The federal Physician Payment Sunshine Act, being implemented
as the Open Payments Program, requires certain pharmaceutical and medical device manufacturers to engage in extensive tracking
of payments or transfers of value to physicians and teaching hospitals, maintenance of a payments database, and public reporting
of the payment data. Device manufacturers with products for which payment is available under Medicare, Medicaid or the State Children&rsquo;s
Health Insurance Program are required to track and report such payments. Moreover, several states have enacted legislation requiring
pharmaceutical and medical device companies to establish marketing compliance programs or even prohibit providing meals to prescribers
or other marketing related activities. Compliance with such requirements may require investment in infrastructure to ensure that
tracking and reporting is performed properly. Although compliance programs can mitigate the risk of investigation and prosecution
for violations of these laws, the risks cannot be entirely eliminated.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>International Regulation</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">International development and sales of
medical devices are subject to foreign government regulations, which vary substantially from country to country. The time required
to obtain approval by a foreign country may be longer or shorter than that required for FDA approval, and the requirements may
differ. For example, the primary regulatory authority with respect to medical devices in Europe is that of the European Union.
The unification of these countries into a common market has resulted in the unification of laws, standards and procedures across
these countries, which may expedite the introduction of medical devices like those we are offering and developing.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The European Union has adopted numerous
directives and standards regulating the design, manufacture, clinical trials, labeling and adverse event reporting for medical
devices. Devices that comply with the requirements of relevant directives will be entitled to bear CE Conformity Marking, indicating
that the device conforms to the essential requirements of the applicable directives and, accordingly, can be commercially distributed
throughout the European Union. Actual implementation of these directives, however, may vary on a country-by-country basis.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">To date, we have not begun any process
to obtain the CE Mark and have no immediate plans to test or commercialize the Hemopurifier in any European Union countries.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Manufacturing</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Manufacturing of our Hemopurifier occurs
in collaboration with a contract manufacturer based in San Diego, California that is compliant with the Good Manufacturing Practice
regulations promulgated by the FDA. Our contract manufacturer is registered with the FDA. We also have received an export license
from the FDA that allows the export our Hemopurifier for commercial purposes to India. To date, our manufacture of the Hemopurifier
has been limited to quantities necessary to support our clinical studies.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>





<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Sources and Suppliers</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We are not dependent on any specific vendors
for the materials used in our Hemopurifier. The key raw materials in the Hemopurifier include the affinity lectin Galanthus nivalis
agglutinin, pharmaceutical grade diatomaceous earth, plasmapheresis cartridges and certain chemical binding agents. The affinity
lectin is available from several life science supply companies in the U.S. Diatomaceous earth is available from several life science
supply companies in the U.S. To date, we have purchased plasmapheresis cartridges from one vendor in Europe however similar cartridges
are commercially available from vendors on a worldwide basis should that European vendor cease to be available for any reason,
including prohibitive pricing. The chemical binding agents are available from a number of life science supply companies on a worldwide
basis. We typically purchase our raw materials on purchase order basis. Therefore, we remain subject to risks of supply shortages
and price increases that potentially could materially adversely affect our financial condition and operating results if and when
we begin large scale manufacture of the Hemopurifier.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The key raw materials used by Exosome Sciences,
Inc. in its research are blood samples supplied by research partners and a number of chemical and lab products commercially available
from vendors on a worldwide basis. Exosome Sciences, Inc. is not dependent on any specific vendors for the materials used in its
research activities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Sales and Marketing</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We do not currently have any sales and
marketing capability. With respect to commercialization efforts in the future, we intend to build or contract for distribution,
sales and marketing capabilities for any product candidate that is approved. From time to time, we have had and are having strategic
discussions with potential collaboration partners for our product candidates, although no assurance can be given that we will
be able to enter into one or more collaboration agreements for our product candidates on acceptable terms, if at all.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Product Liability</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The risk of product liability claims, product
recalls and associated adverse publicity is inherent in the testing, manufacturing, marketing and sale of medical products. We
have limited clinical trial liability insurance coverage. We cannot assure you that future insurance coverage will be adequate
or available. We may not be able to secure product liability insurance coverage on acceptable terms or at reasonable costs when
needed. Any liability for mandatory damages could exceed the amount of our coverage. A successful product liability claim against
us could require us to pay a substantial monetary award. Moreover, a product recall could generate substantial negative publicity
about our products and business and inhibit or prevent commercialization of other future product candidates.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Employees</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have six full-time employees consisting
of our Chief Executive Officer, our President, our Chief Financial Officer, two research scientists and an executive assistant.
We utilize, whenever appropriate, consultants in order to conserve cash and resources.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We believe our employee relations are good.
None of our employees are represented by a labor union or are subject to collective-bargaining agreements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Description of Properties</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We currently lease approximately 2,576
square feet of executive office space at 9635 Granite Ridge Drive, Suite 100, San Diego, California 92123 under a 39-month gross
plus utilities lease that commenced on December 1, 2014 with an initial rental rate of $6,054 per month. Such lease expires in
March 2018. We believe this leased facility will be satisfactory for our office needs over the term of the lease.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We also lease approximately 1,700 square
feet of laboratory space at 11585 Sorrento Valley Road, Suite 109, San Diego, California 92121 at the rate of $4,838 per month
on a one-year lease that expires in November 2017. We presently intend to renew this lease as we believe this leased facility
will be satisfactory for our laboratory needs over the near term.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our Exosome Sciences, Inc. subsidiary previously
rented approximately 2,055 square feet of office and laboratory space at 11 Deer Park Drive, South Brunswick, New Jersey at the
rate of $3,917 per month on a one-year lease that expired in October 2015. In October 2015, Exosome Sciences, Inc. relocated to
a different suite at the same office complex. Exosome Sciences leased that suite, comprised of approximately 541 square feet of
office and laboratory space located at 9 Deer Park Drive, South Brunswick, New Jersey, at the rate of $1,352 per month on a month-to-month
lease basis. In January 2016, we exercised our 30-day notice to terminate the Exosome Sciences&rsquo; lease in New Jersey prior
to consolidating our laboratory operations in San Diego.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Legal Proceedings</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We may be involved from time to time in
various claims, lawsuits, and/or disputes with third parties or breach of contract actions incidental to the normal course of
our business operations. We are currently not involved in any litigation or any pending legal proceedings.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><A NAME="a52"></A><B>DIRECTORS AND EXECUTIVE
OFFICERS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">The names, ages and positions of our directors
and executive officers as of September 8, 2017 are listed below:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: Black 1pt solid">NAMES</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">TITLE OR POSITION</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: center">AGE</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 32%; text-align: left; padding-bottom: 1pt">James A. Joyce (1)</TD><TD STYLE="width: 2%; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 58%; text-align: left; padding-bottom: 1pt">Chairman, Chief Executive Officer and Secretary</TD><TD STYLE="width: 2%; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 6%; text-align: center; padding-bottom: 1pt">55</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: center; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Rodney S. Kenley (2)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">President and Director</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: center; padding-bottom: 1pt">67</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: center; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">James B. Frakes (3)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">Chief Financial Officer and Senior Vice President - Finance</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: center; padding-bottom: 1pt">60</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: center; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Edward G. Broenniman</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">Director</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: center; padding-bottom: 1pt">80</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: center; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Chetan S. Shah, MD</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt">Director</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: center; padding-bottom: 1pt">48</TD></TR>
</TABLE>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 5%">(1)</TD><TD STYLE="width: 95%">Effective June 1, 2001, Mr. Joyce was appointed our President and
                                     Chief Executive Officer, replacing Mr. Barry, who served as a member of the Board of Directors
                                     until March 30, 2017. Mr. Joyce resigned from the position of President upon the appointment
                                     of Mr. Kenley to such position on October 27, 2010.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 5%">(2)</TD><TD STYLE="width: 95%">Effective October 27, 2010, Mr. Kenley was appointed as our President.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 5%">(3)</TD><TD STYLE="width: 95%">Effective September 27, 2010, Mr. Frakes was appointed as our Chief
                                     Financial Officer.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Certain additional information concerning
the individuals named above is set forth below. This information is based on information furnished us by each individual noted.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>James A. Joyce, Chairman, CEO and Secretary</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Mr. Joyce is the founder of Aethlon Medical,
Inc. and has been the Chairman of the Board and Secretary since March 1999. On June 1, 2001, our Board of Directors appointed
Mr. Joyce to the additional role of CEO. Mr. Joyce also serves as the Executive Chairman of Exosome Sciences, Inc. In 1992, Mr.
Joyce founded and was the sole stockholder of James Joyce &amp; Associates, an organization that provided management consulting
and corporate finance advisory services to CEOs and CFOs of publicly traded companies. Previously, from 1989 to 1991, Mr. Joyce
was Chairman and Chief Executive Officer of Mission Labs, Inc. Prior to that Mr. Joyce was a principal in charge of U.S. operations
for London Zurich Securities, Inc. Mr. Joyce is a graduate of the University of Maryland. We believe that Mr. Joyce is qualified
to serve as our director because of his role in founding our company and his prior experience, including his experience in the
extracorporeal industry and in the financial markets.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Rodney S. Kenley, President and Director</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Mr. Kenley has been President and a Director
since October 2010. He has 38 years of experience in healthcare, most of which have been spent in the extracorporeal blood purification
arena. Mr. Kenley held several positions at Baxter Healthcare (Travenol) from 1977 through 1990 including International Marketing
Manager, Business Unit Manager for Peritoneal and Hemodialysis products, Manager of New Business Development, Director of Worldwide
Product Planning, Director of Advanced Product Development, and VP of Electronic Drug Infusion. Mr. Kenley founded Aksys Ltd.
in January 1991 to develop and commercialize his concept of a daily home hemodialysis system which was commercially launched in
2002 as the PHD system. In 2004, Mr. Kenley initiated the development of a second-generation home hemodialysis system in partnership
with DEKA Research &amp; Development Corporation in Manchester, New Hampshire. In 2007, the assets of Aksys Ltd. were acquired
by DEKA, where Mr. Kenley was employed prior to joining Aethlon Medical, Inc. Mr. Kenley received his Bachelor of Arts degree
in Biology and Chemistry from Wabash College, a Master&rsquo;s of Science degree in Molecular Biology from Northwestern University
and a Masters of Management from the Kellogg School of Management, also at Northwestern University. We believe that Mr. Kenley
is qualified to serve as our director as a result of his experience in developing extracorporeal blood purification products.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>James B. Frakes, Chief Financial Officer and Senior Vice
President &ndash; Finance</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Mr. Frakes joined Aethlon Medical, Inc.
in January 2008 and brought 16 consecutive years of financial responsibility for publicly traded companies, as well as specific
knowledge and experience in equity and debt transactions, acquisitions, public reporting and Sarbanes-Oxley Section 404 internal
control requirements. Mr. Frakes also serves as the Chief Financial Officer of Exosome Sciences, Inc. He previously served as
the CFO for Left Behind Games Inc., a start-up video game company. Prior to 2006, he served as CFO of NTN Buzztime, Inc., an interactive
entertainment company. Mr. Frakes received an MBA from the University of Southern California and completed his BA with Honors
at Stanford University.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Edward G. Broenniman, Director</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Mr. Broenniman became a director of Aethlon
Medical, Inc. in March 1999. He has been the Managing Director of The Piedmont Group, LLC, a venture advisory firm, since 1978.
Mr. Broenniman recently served on the Board of Directors of publicly traded QuesTech (acquired by CACI International), and currently
serves on the Boards of two privately held firms. His nonprofit Boards are the Dingman Center for Entrepreneurship's Board of
Advisors at the University of Maryland, the National Association of Corporate Directors, National Capital Chapter and the Board
of the Association for Corporate Growth, National Capital Chapter. We believe that Mr. Broenniman is qualified to serve as our
director because of his extensive management experience.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Chetan S. Shah, MD, Director</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Dr. Shah became a director of Aethlon Medical,
Inc. in June 2013. Dr. Shah is a board-certified Otolaryngologist. He is an Advisory Board Member at The Bank of Princeton, and
a partner and Board member of the Surgery Center at Hamilton as well as Physician Management Systems and Princeton Eye &amp; Ear,
which he founded in 2009. Dr. Shah serves on the board of two other private companies. He holds teaching positions and serves
on multiple hospital committees in the area and is on the Audiology and Speech Language Pathology Committee for the State of New
Jersey. He also served as vice-president of the Board of Medical Examiners for the State of New Jersey. Dr. Shah received his
Bachelor&rsquo;s degree and Medical Degree from Rutgers University and Robert Wood Johnson Medical School. We believe that Dr.
Shah is qualified to serve as our director because of his medical background as both a board-certified Otolaryngologist and a
member of various medical boards and hospital committees in New Jersey.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Board of Directors</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our Board of Directors has the responsibility
for establishing broad corporate policies and for overseeing our overall performance. Members of the Board of Directors are kept
informed of our business activities through discussions with the CEO, President and other officers, by reviewing analyses and
reports sent to them, and by participating in Board and committee meetings. Our bylaws provide that each of the directors serves
for a term that extends to our next annual meeting of stockholders. Our Board of Directors presently has an Audit Committee, a
Compensation Committee and a Nominating and Corporate Governance Committee, on each of which Mr. Broenniman and Dr. Shah serve.
Mr. Broenniman is Chairman of the Audit Committee and the Nominating and Corporate Governance Committee, and Dr. Shah is Chairman
of the Compensation Committee.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">2012 DIRECTORS COMPENSATION PROGRAM</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In July 2012, our Board of Directors approved
a board compensation program that modified and superseded the 2005 Directors Compensation Program, which was previously in effect.
Under the 2012 program, in which only non-employee directors may participate, an eligible director will receive a grant of $35,000
worth of ten-year options to acquire shares of common stock, with such grant being valued at the exercise price based on the average
of the closing bid prices of the common stock for the five trading days preceding the first day of the fiscal year. In addition,
under this program, eligible directors will receive cash compensation equal to $500 for each committee meeting attended and $1,000
for each formal board meeting attended.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">At March 31, 2017, we had issued 26,757
options under the 2005 program to outside directors and 79,309 options to employee-directors, 21,756 outside directors&rsquo;
options had been forfeited, 5,000 outside directors&rsquo; options had been exercised, 79,309 employee-directors&rsquo; options
had been forfeited and no options under the 2005 program remained outstanding. There were no issuances of stock options to our
outside directors in the fiscal years ended March 31, 2016 and 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On June 6, 2014, our Board of Directors
approved certain changes to the 2012 program. Under this modified program, a new eligible director will receive an initial grant
of $50,000 worth of options to acquire shares of common stock, with such grant being valued at the exercise price based on the
average of the closing bid prices of the common stock for the five trading days preceding the first day of the fiscal year. These
options will have a term of ten years and will vest 1/3 upon grant and 1/3 upon each of the first two anniversaries of the date
of grant. In addition, at the beginning of each fiscal year, each existing director eligible to participate in the modified 2012
program also will receive a grant of $35,000 worth of options valued at the exercise price based on the average of the closing
bid prices of the common stock for the five trading days preceding the first day of the fiscal year. Such options will vest on
the first anniversary of the date of grant. In lieu of per meeting fees, eligible directors will receive an annual board retainer
fee of $30,000. The modified 2012 program also provides for the following annual retainer fees: Audit Committee Chair - $5,000,
Compensation Committee chair - $5,000, Nominating Committee chair - $5,000, Audit Committee member - $4,000, Compensation Committee
member - $4,000, Nominating Committee member - $4,000 and lead independent director - $15,000.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On August 9, 2016, the Board approved further
modifications to the program. Under the modified 2012 Program, in which only non-employee directors may participate, a new eligible
director will receive an initial grant of $50,000 worth of RSUs or, at the discretion of the Board, options to acquire shares
of Common Stock. RSUs granted under this provision will be valued based on the average of the closing prices of the Common Stock
for the five trading days preceding and including the date of grant and will vest at a rate determined by the Board in its discretion.
Options granted under this provision will be valued at the exercise price, which will be based on the average of the closing prices
of the Common Stock for the five trading days preceding and including the date of grant. Such options will have a term of ten
years and will vest at a rate determined by the Board in its discretion.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">At the beginning of each fiscal year, each
existing director eligible to participate in the 2012 Program will receive a grant of $35,000 worth of RSUs or, at the discretion
of the Board, options to acquire shares of Common Stock. RSUs granted under this provision will be valued based on the average
of the closing prices of the Common Stock for the five trading days preceding and including the first day of the fiscal year (or
preceding and including the date of grant, if such grant is not made on the first day of the fiscal year) and will vest at a rate
determined by the Board in its discretion. Options granted under this provision will be valued at the exercise price, which will
be based on the average of the closing prices of the Common Stock for the five trading days preceding and including the first
day of the fiscal year (or preceding and including the date of grant, if such grant is not made on the first day of the fiscal
year). Such options will have a term of ten years and will vest at a rate determined by the Board in its discretion.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The RSU grants and the changes to the 2012
Program were approved and recommended by our Compensation Committee prior to approval by the Board.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Family Relationships</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">There are no family relationships between
or among the directors, executive officers or persons nominated or chosen by us to become directors or executive officers.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">There are no arrangements or understandings
between any two or more of our directors or executive officers or between any of our directors or executive officers and any other
person pursuant to which any director or officer was or is to be selected as a director or officer, and there is no arrangement,
plan or understanding as to whether non-management stockholders will exercise their voting rights to continue to elect the current
Board of Directors. There are also no arrangements, agreements or understandings between non-management stockholders that may
directly or indirectly participate in or influence the management of our affairs.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Involvement in Legal Proceedings</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">To the best of our knowledge, during the
past ten years, none of the following occurred with respect to a present or former director or executive officer of our company:
(1) any bankruptcy petition filed by or against such person or any business of which such person was a general partner or executive
officer either at the time of the bankruptcy or within two years prior to that time; (2) any conviction in a criminal proceeding
or being subject to a pending criminal proceeding (excluding traffic violations and other minor offenses); (3) being subject to
any order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of any competent jurisdiction, permanently
or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking
activities; (4) being found by a court of competent jurisdiction (in a civil action), the Securities and Exchange Commission or
the Commodities Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment
has not been reversed, suspended or vacated; and (5) being the subject of, or a party to, any federal or state judicial or administrative
order, judgment, decree or finding, not subsequently reversed, suspended or vacated, relating to an alleged violation of any federal
or state securities or commodities law or regulation, law or regulation respecting financial institutions or insurance companies
or law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or (6) being the subject
of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization
(as defined in Section 3(a)(26) of the Securities Exchange Act of 1934), any registered entity (as defined in Section 1(a)(29)
of the Commodity Exchange Act), or any equivalent exchange, association, entity or organization that has disciplinary authority
over its members or associated persons.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.9pt"><B>Code of Ethics</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.9pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On February 23, 2005, the Board of Directors
approved a &quot;Code of Business Conduct and Ethics,&rdquo; which applies to our principal executive officer, our principal financial
officer, our principal accounting officer and persons performing similar tasks. Our Code of Business Conduct and Ethics is available
on our company website at <FONT STYLE="color: blue">www.aethlonmedical.com</FONT>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Audit Committee and Audit Committee Financial Expert</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our Board of Directors formed an Audit
Committee in May of 1999. Mr. Edward Broenniman (the Chairman of the Audit Committee) and Dr. Chetan S. Shah serve as members
of the Audit Committee. The Board of Directors has determined that Mr. Broenniman is an &quot;audit committee financial expert&quot;
as that term is defined by Item 407 of Regulation S-K. Mr. Broenniman and Dr. Shah meet the NASDAQ Stock Market's independence
standards for members of such audit committees.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><A NAME="a53"></A><B>EXECUTIVE COMPENSATION</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The following executive compensation disclosure
reflects all compensation awarded to, earned by or paid to the executive officers below for the fiscal years ended March 31, 2017
and March 31, 2016. The following table summarizes all compensation for fiscal years 2017 and 2016 received by our Chief Executive
Officer, and our three most highly compensated executive officers who earned more than $100,000 in fiscal year 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">SUMMARY COMPENSATION TABLE FOR 2017 AND 2016 FISCAL YEARS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid; vertical-align: bottom"><FONT STYLE="font-size: 8pt">NAMED EXECUTIVE
    OFFICER AND PRINCIPAL POSITION</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: center; vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid; vertical-align: bottom"><FONT STYLE="font-size: 8pt">YEAR</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: center; vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: center; vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid; vertical-align: bottom"><P STYLE="margin-top: 0; margin-bottom: 0"><BR><FONT STYLE="font-size: 8pt">SALARY</FONT></P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0"><FONT STYLE="font-size: 8pt">($)</FONT></P></TD><TD STYLE="padding-bottom: 1pt; text-align: center; vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: center; vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid; vertical-align: bottom"><FONT STYLE="font-size: 8pt">BONUS
    ($)</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: center; vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: center; vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid; vertical-align: bottom"><P STYLE="margin-top: 0; margin-bottom: 0"><FONT STYLE="font-size: 8pt">STOCK</FONT></P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0"><FONT STYLE="font-size: 8pt">AWARDS
                                         ($)</FONT></P></TD><TD STYLE="padding-bottom: 1pt; text-align: center; vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: center; vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid; vertical-align: bottom"><FONT STYLE="font-size: 8pt">OPTION
    AWARDS ($)(5)</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: center; vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: center; vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid; vertical-align: bottom"><FONT STYLE="font-size: 8pt">NON-
    </FONT><BR> <FONT STYLE="font-size: 8pt">EQUITY </FONT><BR> <FONT STYLE="font-size: 8pt">INCENTIVE </FONT><BR> <FONT STYLE="font-size: 8pt">PLAN
    </FONT><BR> <FONT STYLE="font-size: 8pt">COMPEN- </FONT><BR> <FONT STYLE="font-size: 8pt">SATION </FONT><BR> <FONT STYLE="font-size: 8pt">($)</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: center; vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: center; vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid; vertical-align: bottom"><P STYLE="margin-top: 0; margin-bottom: 0"><FONT STYLE="font-size: 8pt">NON-</FONT></P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0"><FONT STYLE="font-size: 8pt">QUALIFIED
                                         DEFERRED COMPEN- SATION </FONT><BR><FONT STYLE="font-size: 8pt">EARNINGS($)</FONT></P></TD><TD STYLE="padding-bottom: 1pt; text-align: center; vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: center; vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid; vertical-align: bottom"><FONT STYLE="font-size: 8pt">ALL
    OTHER COMP ($)</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: center; vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: center; vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid; vertical-align: bottom"><FONT STYLE="font-size: 8pt">TOTAL
    ($)</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: center; vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; width: 28%"><FONT STYLE="font-size: 8pt">James A. Joyce (1) </FONT><BR></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: center; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 5%; text-align: center; vertical-align: top"><FONT STYLE="font-size: 8pt">2017</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="width: 5%; text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">385,000</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="width: 5%; text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="width: 5%; text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">678,380</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="width: 5%; text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="width: 5%; text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="width: 5%; text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="width: 5%; text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="width: 5%; text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">1,063,380</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">CHIEF EXECUTIVE OFFICER</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: center; vertical-align: top"><FONT STYLE="font-size: 8pt">2016</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">370,417</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">275,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">645,417</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: center; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">Richard H. Tullis, PhD (2)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: center; vertical-align: top"><FONT STYLE="font-size: 8pt">2017</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-left: 3pt; text-indent: -3pt"><FONT STYLE="font-size: 8pt">VICE PRESIDENT AND CHIEF SCIENCE
    OFFICER</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: center; vertical-align: top"><FONT STYLE="font-size: 8pt">2016</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">188,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">188,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: center; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-size: 8pt">James B. Frakes (3)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: center; vertical-align: top"><FONT STYLE="font-size: 8pt">2017</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">235,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">55,640</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">290,640</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-left: 3pt; text-indent: -3pt"><FONT STYLE="font-size: 8pt">CHIEF FINANCIAL OFFICER AND
    SVP- FINANCE</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: center; vertical-align: top"><FONT STYLE="font-size: 8pt">2016</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">226,429</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">125,500</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">351,929</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: center; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">Rodney S. Kenley (4)</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: center; vertical-align: top"><FONT STYLE="font-size: 8pt">2017</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">275,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">55,640</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">330,640</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-size: 8pt">PRESIDENT</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD STYLE="text-align: center; vertical-align: top"><FONT STYLE="font-size: 8pt">2016</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">268,750</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">50,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">$</FONT></TD><TD STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 8pt">318,750</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">(1) The aggregate number
of stock awards and stock option awards issued to Mr. Joyce and outstanding as of March 31, 2017 is 158,500 and 210,000, respectively.
In September 2015, Mr. Joyce received a $35,000 salary increase from $350,000 to $385,000.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">(2) The aggregate number of stock awards
and stock option awards issued to Dr. Tullis and outstanding as of March 31, 2017 is zero and 46,000, respectively. In January
2015, we paid Dr. Tullis $93,377 in payment of accrued salary. Dr. Tullis resigned as an employee effective February 9, 2016 and
is now a consultant to the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">(3) Mr. Frakes was appointed
as Chief Financial Officer on September 27, 2010 after previously serving as Senior Vice President-Finance on a part-time basis.
The aggregate number of stock awards and stock option awards issued to Mr. Frakes and outstanding as of March 31, 2017 is 13,000
and 25,000, respectively. In September 2015, Mr. Frakes received a $25,000 salary increase from $210,000 to $235,000.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">(4) Mr. Kenley was appointed
President on October 27, 2011. The aggregate number of stock awards and stock option awards issued to Mr. Kenley and outstanding
as of March 31, 2017 is 13,000 and 35,000, respectively. In September 2015, Mr. Kenley received a $15,000 salary increase from
$260,000 to $275,000.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">(5) See note 5 to our
financial statements for the years ended March 31, 2017 and 2016 regarding the assumptions made in valuing the restricted stock
unit awards in the above table.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">EMPLOYMENT CONTRACTS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We entered into an employment agreement
with Mr. Joyce effective April 1, 1999. The agreement, which is cancelable by either party upon sixty days&rsquo; notice, will
be in effect until the Chairman retires or ceases to be employed by us. Under the terms of the agreement, if Mr. Joyce is terminated
he may become eligible to receive a salary continuation payment in the amount of at least twelve months' base salary, which was
increased to $385,000 per year in September 2015.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">During the fiscal year ended March 31,
2016, Mr. Joyce earned bonuses totaling $100,000 from us, excluding a retention bonus (see below) and bonuses totaling $75,000
from Exosome Sciences, Inc. That bonus was based upon targets established by our compensation committee. Aethlon did not pay any
bonuses during the fiscal year ended March 31, 2017. Mr. Joyce received bonuses totaling $60,000 from Exosome during the fiscal
year ended March 31, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Mr. Joyce's employment agreement provides
for medical insurance and disability benefits, and one year of severance pay if his employment is terminated by us without cause
or due to change in our control before the expiration of the agreement, and allows for bonus compensation and stock option grants
as determined by our Board of Directors. The agreement also contains restrictive covenants preventing competition with us and
the use of confidential business information, except in connection with the performance of his duties for us, for a period of
two years following the termination of his employment with us.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In February 2016, we entered into a part-time
consulting agreement with Tullis, who was previously our CSO (formerly with an employment agreement with a $195,000 salary and
a termination continuation payment equal to one year&rsquo;s base salary). Under that agreement, Tullis continued to provide services
under the terms of a consulting agreement with us. In connection with the change in his employment, Tullis resigned as our Vice
President. Under the consulting agreement, Tullis rendered approximately twenty (20) hours per week of such services, for which
we paid him a consulting fee of $10,000 per month. The term of the consulting agreement was for an initial sixty-day period and,
unless terminated earlier by either party, shall automatically extend for additional one-month periods. Either party to the consulting
agreement may terminate it upon 30 day&rsquo;s prior written notice to the other party. Concurrently with the entry into the consulting
agreement, Tullis and the Company mutually agreed to terminate his employment agreement with us.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In November 2016, the scope of the consulting
agreement was amended to reduce the hours from 20 hours per week to 20 hours per month with a reduction in monthly consulting
fees from the original $10,000 per month to $4,000 per month. Then in February 2017, the scope of the consulting agreement was
further amended to reduce the hours from 20 hours per month to 10 hours per month with a reduction in monthly consulting fees
from $4,000 per month to $2,000 per month.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On September 27, 2010, Mr. Frakes was appointed
our Chief Financial Officer. We have not entered into a written employment agreement with Mr. Frakes. As Chief Financial Officer,
Mr. Frakes received an annual salary initially set at $180,000 and medical insurance benefits. In June 2014, his salary was increased
from $180,000 to $210,000 per year. In September 2015, Mr. Frakes received a $25,000 salary increase from $210,000 to $235,000.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">During the fiscal year ended March 31,
2016, Mr. Frakes earned bonuses totaling $75,000 from us, excluding a retention bonus (see below). That bonus was based upon targets
established by our compensation committee. Aethlon did not pay any bonuses during the fiscal year ended March 31, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Mr. Kenley was appointed our President
on October 27, 2010. Pursuant to a written offer of employment executed by us and Mr. Kenley, he received an annual salary initially
set at $240,000 and medical insurance benefits. In June 2014, his salary was increased from $240,000 to $260,000 per year. In
September 2015, Mr. Kenley received a $15,000 salary increase from $260,000 to $275,000.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">During the fiscal year ended March 31,
2016, Mr. Kenley received a retention bonus (see below). Aethlon did not pay any bonuses during the fiscal year ended March 31,
2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.9pt"><B>Retention Agreements</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.9pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On October 16, 2015, following a recommendation
of our Compensation Committee, we approved retention bonus grants to three of our executive officers under a newly established
Aethlon Senior Management Retention Program to maintain management stability going forward. The Board approved a $100,000 retention
bonus for Mr. James A. Joyce, our Chief Executive Officer, a $50,000 retention bonus for Mr. Rodney S. Kenley, our President,
and a $50,000 retention bonus for Mr. James B. Frakes, our Chief Financial Officer.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In connection with the bonus granted to
Mr. Joyce, we entered into an amendment of Mr. Joyce&rsquo;s Employment Agreement dated April 1, 1999. Pursuant to the amendment,
if within two years of the effective date of the amendment, we terminate Mr. Joyce&rsquo;s employment with us for &ldquo;Cause&rdquo;
(as defined in his employment agreement) or Mr. Joyce terminates his employment with us other than for &ldquo;Good Reason&rdquo;
(as defined in his employment agreement), Mr. Joyce must repay in full the amount of the bonus received from us. In the event
of his death or disability or termination by us other than for &ldquo;Cause&rdquo; or termination by Mr. Joyce for &ldquo;Good
Reason,&rdquo; Mr. Joyce will not be required to repay any portion of the bonus received by him.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In connection with the bonus granted to
Mr. Kenley, we entered into an amendment of Mr. Kenley&rsquo;s Offer Letter dated October 27, 2010. Pursuant to the amendment,
if within two years of the effective date of the amendment, we terminate Mr. Kenley&rsquo;s employment with us for &ldquo;Cause&rdquo;
(as defined in the amendment) or Mr. Kenley terminates his employment with us other than for &ldquo;Good Reason&rdquo; (as defined
in the amendment), Mr. Kenley must repay in full the amount of the bonus received from us. In the event of his death or disability
or termination by us other than for &ldquo;Cause&rdquo; or termination by Mr. Kenley for &ldquo;Good Reason,&rdquo; Mr. Kenley
will not be required to repay any portion of the bonus received by him.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In connection with the bonus granted to
Mr. Frakes, we entered into a Retention Bonus Agreement with Mr. Frakes. Pursuant to the agreement, if within two years of the
effective date of the agreement, we terminate Mr. Frakes&rsquo; employment with us for &ldquo;Cause&rdquo; (as defined in the
agreement) or Mr. Frakes terminates his employment with us other than for &ldquo;Good Reason&rdquo; (as defined in the agreement),
Mr. Frakes must repay in full the amount of the bonus received from us. In the event of his death or disability or termination
by us other than for &ldquo;Cause&rdquo; or termination by Mr. Frakes for &ldquo;Good Reason,&rdquo; Mr. Frakes will not be required
to repay any portion of the bonus received by him.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Outstanding Equity Awards at 2017 Fiscal Year-End</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The following table sets forth certain
information concerning stock option awards granted to our named executive officers.</P>

<P STYLE="margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt">OUTSTANDING EQUITY AWARDS AT 2017 FISCAL
YEAR</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt">END OPTIONS AWARDS</P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"></P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2">NUMBER OF SECURITIES UNDERLYING UNEXERCISED OPTIONS EXERCISABLE</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2">RESTRICTED STOCK UNITS EXERCISED</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2">RESTRICTED STOCK UNITS UNEXERCISABLE</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2">OPTION EXERCISE PRICE</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2">DATE OF OPTION</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: Black 1pt solid">NAME</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: left; padding-bottom: 1pt; border-bottom: Black 1pt solid">(#)</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: left; padding-bottom: 1pt; border-bottom: Black 1pt solid">(#)</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: left; padding-bottom: 1pt; border-bottom: Black 1pt solid">(#)</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: left; padding-bottom: 1pt; border-bottom: Black 1pt solid">($)</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: left; border-bottom: Black 1pt solid">EXPIRATION</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 25%; text-align: left">James A. Joyce</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; text-align: right">50,000</TD><TD STYLE="width: 1%; text-align: left">(1)</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; text-align: right">&ndash;</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; text-align: right">&ndash;</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 11%; text-align: right">18.00</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; text-align: right">09/21/17</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">40,000</TD><TD STYLE="text-align: left">(2)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">12.50</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">02/21/19</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">50,000</TD><TD STYLE="text-align: left">(3)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">12.50</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">09/27/20</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">40,000</TD><TD STYLE="text-align: left">(4)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">5.00</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">07/01/23</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">30,000</TD><TD STYLE="text-align: left">(7)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">9.50</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">06/06/24</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">158,500</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">475,500</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">N/A</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">N/A</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">Richard H. Tullis</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">15,000</TD><TD STYLE="text-align: left">(5)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">20.50</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">06/14/18</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">(former CSO)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">20,000</TD><TD STYLE="text-align: left">(6)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">12.50</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">09/27/20</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">10,000</TD><TD STYLE="text-align: left">(4)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">5.00</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">07/01/23</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,000</TD><TD STYLE="text-align: left">(7)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">9.50</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">06/06/24</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">James B. Frakes</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">10,000</TD><TD STYLE="text-align: left">(6)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">12.50</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">09/27/20</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">10,000</TD><TD STYLE="text-align: left">(4)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">5.00</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">07/01/23</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,000</TD><TD STYLE="text-align: left">(7)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">9.50</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">06/06/24</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">13,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">39,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">N/A</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">N/A</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">Rodney S. Kenley</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">20,000</TD><TD STYLE="text-align: left">(6)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">12.50</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">10/27/20</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">10,000</TD><TD STYLE="text-align: left">(4)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">5.00</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">7/01/23</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,000</TD><TD STYLE="text-align: left">(7)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">9.50</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">06/06/24</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">13,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">39,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">N/A</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">N/A</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Note: All our stock options are fully
vested or will completely vest within 60 days of this report.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">(1)<FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;
</FONT>This option was fully vested as of June 13, 2010.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">(2)<FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;
</FONT>This option was fully vested as of December 15, 2010.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">(3)<FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;
</FONT>This option was fully vested as of September 27, 2013.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">(4)<FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;
</FONT>This option vests ratably on July 1, 2014, July 1, 2015, July 1, 2016 and July 1, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">(5)<FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;
</FONT>This option was fully vested as of December 15, 2011.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">(6)<FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;
</FONT>This option was fully vested as of October 27, 2014.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">(7)<FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;
</FONT>This option was fully vested as of June 6, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Director Compensation for 2017 Fiscal Year</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The following director
compensation disclosure reflects all compensation awarded to, earned by or paid to the directors below for the fiscal year ended
March 31, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 9pt">Fees</FONT><BR>
    <FONT STYLE="font-size: 9pt">Earned</FONT><BR> <FONT STYLE="font-size: 9pt">or Paid in</FONT><BR> <FONT STYLE="font-size: 9pt">Cash</FONT><BR>
    <FONT STYLE="font-size: 9pt">($)</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 9pt">Stock Awards </FONT><BR>
    <FONT STYLE="font-size: 9pt">($)</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 9pt">Option Awards </FONT><BR>
    <FONT STYLE="font-size: 9pt">($)</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 9pt">Non-Equity</FONT><BR>
    <FONT STYLE="font-size: 9pt">Incentive</FONT><BR> <FONT STYLE="font-size: 9pt">Plan</FONT><BR> <FONT STYLE="font-size: 9pt">Compensation</FONT><BR>
    <FONT STYLE="font-size: 9pt">($)</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 9pt">Nonqualified Deferred
    Compensation Earnings </FONT><BR>
    <FONT STYLE="font-size: 9pt">($)</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 9pt">All</FONT><BR>
    <FONT STYLE="font-size: 9pt">Other</FONT><BR> <FONT STYLE="font-size: 9pt">Compensation</FONT><BR>
    <FONT STYLE="font-size: 9pt">($)</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 9pt">Total </FONT><BR>
    <FONT STYLE="font-size: 9pt">($)</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">James A. Joyce (1)</FONT></TD><TD><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">$</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 9pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 9pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 9pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 9pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 9pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 9pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">$</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 9pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">Rodney S. Kenley (2)</FONT></TD><TD><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">$</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 9pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 9pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 9pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 9pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 9pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 9pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">$</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 9pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; width: 27%"><FONT STYLE="font-size: 9pt">Edward G. Broenniman (3)</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 9pt">$</FONT></TD><TD STYLE="width: 8%; text-align: right"><FONT STYLE="font-size: 9pt">39,000</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right"><FONT STYLE="font-size: 9pt">94,438</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="width: 7%; text-align: right"><FONT STYLE="font-size: 9pt">&ndash;</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="width: 7%; text-align: right"><FONT STYLE="font-size: 9pt">&ndash;</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="width: 7%; text-align: right"><FONT STYLE="font-size: 9pt">&ndash;</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="width: 7%; text-align: right"><FONT STYLE="font-size: 9pt">&ndash;</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 9pt">$</FONT></TD><TD STYLE="width: 8%; text-align: right"><FONT STYLE="font-size: 9pt">133,438</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">Franklyn S. Barry, Jr. (4)</FONT></TD><TD><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">$</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 9pt">39,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 9pt">94,438</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 9pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 9pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 9pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 9pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">$</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 9pt">133,438</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">Chetan S. Shah, MD (5)</FONT></TD><TD><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">$</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 9pt">39,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 9pt">94,438</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 9pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 9pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 9pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 9pt">&ndash;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">$</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 9pt">133,438</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 9pt">&nbsp;</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<!-- Field: Rule-Page --><DIV ALIGN="LEFT" STYLE="margin-top: 3pt; margin-bottom: 3pt"><DIV STYLE="font-size: 1pt; border-top: Black 1pt solid; width: 25%">&nbsp;</DIV></DIV><!-- Field: /Rule-Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">(1)<FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;
</FONT>All compensation received by Mr. Joyce in fiscal year 2017 is disclosed in the Summary Compensation Table above. Mr. Joyce
received no compensation as a director in fiscal year 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">(2)<FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;
</FONT>All compensation received by Mr. Kenley in fiscal year 2017 is disclosed in the Summary Compensation Table above. Mr. Kenley
received no compensation as a director in fiscal year 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">(3)<FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;
</FONT>The aggregate number of stock awards and options awards issued and outstanding as of March 31, 2017 are 16,432 and 43,431,
respectively. Mr. Broenniman received stock option grants of 3,684 shares on June 6, 2014, 8,537 shares on March 14, 2014, and
9,211 shares on July 24, 2012 for his service as an outside director. The June 2014 option vested 3,684 shares on March 31, 2015,
the March 2014 option vested all 8,537 shares at grant and the 2012 option vested 3,961 at grant, with 5,250 vesting in the June
2013 quarter. In January 2016, we paid $39,000 to Mr. Broenniman in payment of accrued Board of Directors fees for the fiscal
year ended March 31, 2015 and in April 2016 we paid $38,000 to Mr. Broenniman in payment of accrued Board of Directors fees for
the fiscal year ended March 31, 2016. During the fiscal year ended March 31, 2017, we paid Mr. Broenniman $29,250 in Board of
Directors fees.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">(4)<FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;
</FONT>The aggregate number of stock awards and options awards issued and outstanding as of March 31, 2017 are 16,432 and 41,431,
respectively. Mr. Barry received stock option grants of 3,684 shares on June 6, 2014, 8,537 shares on March 14, 2014 and 9,211
shares on July 24, 2012 for his service as an outside director. The June 2014 option vested 3,684 shares on March 31, 2015, the
March 2014 option vested all 8,537 shares at grant and the 2012 option vested 3,961 at grant, with 5,250 vesting in the June 2013
quarter. In October 2015, we paid $39,000 to Mr. Barry in payment of accrued Board of Directors fees for the fiscal year ended
March 31, 2015 and in April 2016 we paid $39,000 to Mr. Barry in payment of accrued Board of Directors fees for the fiscal year
ended March 31, 2016. During the fiscal year ended March 31, 2017, we paid Mr. Barry $29,250 in Board of Directors fees. Mr. Barry
retired from our Board of Directors as of March 30, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">(5)&nbsp; The aggregate number of stock awards
and options awards issued and outstanding as of March 31, 2017 are 16,432 and 11,205, respectively. Dr. Shah received stock option
grants of 3,684 on June 6, 2014 and 7,520 shares on July 24, 2012 for his service as an outside director. The June 2014 option
vested 3,684 shares on March 31, 2015, and the 2014 option vested all 7,520 shares at grant. In October 2015, we paid $39,000
to Dr. Shah in payment of accrued Board of Directors fees for the fiscal year ended March 31, 2015 and in April 2016 we paid $39,000
to Dr. Shah in payment of accrued Board of Directors fees for the fiscal year ended March 31, 2016. During the fiscal year ended
March 31, 2017, we paid Dr. Shah $29,250 in Board of Directors fees.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Directors Compensation Program</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We maintain a board compensation program,
in which only non-employee directors may participate. Please see the &ldquo;Equity Compensation Plans &ndash; 2012 Directors Compensation
Program&rdquo; section of this Report for more information on the program.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><A NAME="a54"></A><B>SECURITY OWNERSHIP
OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The following table sets forth information
as of September 7, 2017, with respect to the ownership of our common stock, by (i) each person known by us to be the beneficial
owner of more than five percent (5%) of the outstanding shares of each class of our capital stock, (ii) each of our directors
and director nominees (if any), (iii) each of our named executive officers and (iv) all of our current executive officers and
directors as a group. As of such date, we had <FONT STYLE="background-color: white">8,951,081</FONT> shares of our common stock
issued and outstanding. The term &quot;executive officer&quot; is defined as the President/Chief Executive Officer, Secretary,
Chief Financial Officer/Treasurer, any vice-president in charge of a principal business function (such as administration or finance),
or any other person who performs similar policy making functions for us. We believe that each individual or entity named has sole
investment and voting power with respect to shares of common stock indicated as beneficially owned by them, subject to community
property laws where applicable, excepted where otherwise noted:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 10.1pt">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; background-color: white; border-collapse: collapse">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">NAME AND ADDRESS</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">AMOUNT AND NATURE OF BENEFICIAL OWNERSHIP (1) (2)</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">PERCENT OF BENEFICIAL OWNERSHIP BEFORE
    OFFERING</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">PERCENT OF BENEFICIAL OWNERSHIP AFTER OFFERING**</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #EEEEEE">
    <TD><FONT STYLE="font-size: 10pt">James A. Joyce, Chief Executive Officer and Director</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #EEEEEE">
    <TD><FONT STYLE="font-size: 10pt">9635 Granite Ridge Drive, Suite 100</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #EEEEEE">
    <TD STYLE="width: 41%; border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">San Diego, CA 92123</FONT></TD>
    <TD STYLE="width: 1%; border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="width: 18%; border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">386,939 shares (3)</FONT></TD>
    <TD STYLE="width: 1%; border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="width: 18%; border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">4.30% </FONT></TD>
    <TD STYLE="width: 1%; border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="width: 18%; border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;2.81%</FONT></TD>
    <TD STYLE="width: 1%; border-bottom: black 1pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">Rodney S. Kenley, President and Director</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">9635 Granite Ridge Drive, Suite 100</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">San Diego, CA 92123</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">47,262 shares (4)</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">*</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;*</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #EEEEEE">
    <TD><FONT STYLE="font-size: 10pt">James B. Frakes, Chief Financial Officer</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #EEEEEE">
    <TD><FONT STYLE="font-size: 10pt">9635 Granite Ridge Drive, Suite 100</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #EEEEEE">
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">San Diego, CA 92123</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">35,726 shares (5)</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">*</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;*</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">Franklyn S. Barry, Jr., Former Director</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">9635 Granite Ridge Drive, Suite 100</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">San Diego, CA 92123</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">54,233 shares (6)</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">*</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;*</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #EEEEEE">
    <TD><FONT STYLE="font-size: 10pt">Edward G. Broenniman, Director</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #EEEEEE">
    <TD><FONT STYLE="font-size: 10pt">9635 Granite Ridge Drive, Suite 100</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #EEEEEE">
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">San Diego, CA 92123</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">59,755 shares (7)</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">*</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;*</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">Chetan Shah, MD, Director</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">9635 Granite Ridge Drive, Suite 100</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">San Diego, CA 92123</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">405,628 shares (8)</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">4.50% </FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;2.95%</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #EEEEEE">
    <TD><FONT STYLE="font-size: 10pt">Empery Asset Management, LLC (12)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #EEEEEE">
    <TD><FONT STYLE="font-size: 10pt">1 Rockefeller Plaza, Suite 1205</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #EEEEEE">
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">New York, New York 10020</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">1,586,096 shares (9)</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">8.7%</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;5.36%</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">Ellen R Weiner Family Revocable Trust (12)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">10300 W. Charleston Blvd. #13-222</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">Las Vegas, NV 89135</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">708,335 shares (10)</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">7.80% </FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;5.16%</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #EEEEEE">
    <TD><FONT STYLE="font-size: 10pt">Alpha Capital Anstalt (12)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #EEEEEE">
    <TD><FONT STYLE="font-size: 10pt">Lettstrasse 32, FL-9490 Vaduz,</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #EEEEEE">
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">Furstentums, Liechtenstein</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">738,958 shares (11)</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">7.70% </FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;5.38%</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">Sachs Investment Group, LLC (12)</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">1346 S. Third St., Louisville, KY 40208</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">1,344,305 shares</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">15.10% </FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;9.79%</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #EEEEEE">
    <TD><FONT STYLE="font-size: 10pt">All Current Directors and Executive Officers as a Group (7</FONT></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #EEEEEE">
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">members)</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">989,542 shares</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">10.60% </FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;7.21%</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>




<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">____________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">*</TD>
    <TD>Less than 1%</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>
<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">**</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Based upon an assumed 4,777,070 shares of our
    common stock offered hereby.</FONT></TD></TR>
</TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">(1)</TD>
    <TD>Based on 8,951,081 shares of common stock outstanding on our transfer records as of September 8, 2017.</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>


<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">(2)</TD>
    <TD>Calculated pursuant to Rule 13d-3(d)(1) of the Securities Exchange Act of 1934. Under Rule 13d-3(d)(1), shares not outstanding
    that are subject to options, warrants, rights or conversion privileges exercisable by a person within 60 days are deemed outstanding
    for the purpose of calculating the number and percentage owned by such person but not deemed outstanding for the purpose of
    calculating the percentage owned by each other person listed. Except where otherwise noted, we believe that each individual
    or entity named has sole investment and voting power with respect to the shares of common stock indicated as beneficially
    owned by such person, subject to community property laws, where applicable.</TD></TR>
</TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"></P>


<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">(3)</TD>
    <TD>Includes 50,000 stock options exercisable at $18.00 per share, 90,000 stock options exercisable at $12.50 per share, 40,000
    stock options exercisable at $5.00 per share and 30,000 stock options exercisable at $9.50 per share. Also includes shares
    underlying 19,079 restricted stock units that will vest and issue on September _7, 2017.</TD></TR>
</TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">(4)</TD>
    <TD>Includes 20,000 stock options exercisable at $12.50 per share, 10,000 stock options exercisable at $5.00 per share and
    5,000 stock options exercisable at $9.50 per share. Also includes shares underlying 1,797 restricted stock units that will
    vest and issue on September 7, 2017.</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">(5)</TD>
    <TD>Includes 10,000 stock options exercisable at $12.50 per share, 10,000 stock options exercisable at $5.00 per share and
    5,000 stock options exercisable at $9.50 per share. Also includes shares underlying 1,594 restricted stock units that will
    vest and issue on September 7, 2017.</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">(6)</TD>
    <TD>Includes 10,000 stock options exercisable at $20.50 per share, 10,000 stock options exercisable at $12.50 per share, 9,211
    stock options exercisable at $3.80 per share, 8,537 stock options exercisable at $4.10 per share and 3,684 stock options exercisable
    at $9.50 per share.</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">(7)</TD>
    <TD>Includes 10,000 stock options exercisable at $20.50 per share, 12,000 stock options exercisable at $12.50 per share, 9,211
    stock options exercisable at $3.80 per share, 8,537 stock options exercisable at $4.10 per share and 3,684 stock options exercisable
    at $9.50 per share.</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">(8)</TD>
    <TD>Includes warrants to purchase 109,322 shares of common stock at exercise prices ranging from $4.65 per share to $6.60
    per share, and 7,521 stock options exercisable at $4.10 per share and 3,684 stock options exercisable at $9.50 per share.</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">(9)</TD>
    <TD><P STYLE="margin: 0pt 0">Includes warrants held by funds managed by Empery Asset Management, LP (&ldquo;Empery&rdquo;)
        to purchase 813,096 shares of common stock at an exercise price of $3.95 per share. Empery&rsquo;s beneficial ownership
        is limited contractually to the extent that exercise of such warrants would cause the aggregate number of shares of common
        stock beneficially owned by Empery to exceed 4.99% of our outstanding shares. The percentage of beneficial ownership before
        offering for Empery gives effect to such 4.99% beneficial ownership blocker, while the number of shares in the prior column
        does not give effect to such blocker. The information about Empery set forth in this chart was taken from the most recent
        Schedule 13G filed by Empery.</P>


</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">(10)</TD>
    <TD>Includes common stock issuable upon exercise of warrants held by the Ellen R. Weiner Family Revocable Trust. The trust
    owns 235,934 warrants to purchase common shares at prices ranging from $2.10 to $5.40 per share.</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">(11)</TD>
    <TD>Includes certain shares issuable upon the conversion of convertible notes and exercise of warrants held by Alpha Capital
    Anstalt (&ldquo;Alpha&rdquo;). Alpha owns two convertible notes in the aggregate principal amount of $979,603 convertible
    into 244,901 shares of common stock at $4.00 and warrants to purchase 448,432 shares of common stock at prices ranging from
    $3.95 to $5.00 per share. Alpha&rsquo;s beneficial ownership is limited contractually to the extent that exercise of such
    notes and warrants would cause the aggregate number of shares of common stock beneficially owned by Alpha to exceed 4.99%
    of our outstanding shares. Accordingly, beneficial ownership for Alpha does not reflect 254,537 shares underlying such notes
    and warrants.</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">(12)</TD>
    <TD>More-than-5% stockholder.</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: center; margin-bottom: 0pt"><A NAME="a55"></A><B>CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The following describes all transactions
since April 1, 2015, and all proposed transactions, in which we were or are to be a participant and the amount involved exceeds
the lesser of $120,000 or one percent of the average of our total assets at year-end for the last two completed fiscal years,
and in which any related person had or will have a direct or indirect material interest.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In June 2015, Mr. James Joyce, our Chief
Executive Officer, Mr. James Frakes, our Chief Financial Officer and Dr. Chetan Shah, a director of our company, agreed to waive
their rights to acquire an aggregate of 402,318 shares of common stock underlying certain stock options and warrants held by them.
Those waivers were required in order to make a sufficient number of shares of common stock available for issuance upon the exercise
of the warrants issued in our June 2015 financing. Those waivers expired when we amended our Articles of Incorporation on March
31, 2016, to increase sufficiently the number of authorized shares of common stock available for issuance following approval of
that measure at our annual stockholders&rsquo; meeting on March 29, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In September 2015, the Compensation Committee
approved and we paid bonuses of $100,000 and $75,000 to Mr. Joyce and Mr. Frakes, respectively, for achieving an agreed milestone
event of achieving a Nasdaq listing.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Retention Agreements</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On October 16, 2015, following a recommendation
of our Compensation Committee, we approved retention bonus grants to three of our executive officers under a newly established
Aethlon Senior Management Retention Program to maintain management stability going forward. The Board approved a $100,000 retention
bonus for Mr. James A. Joyce, our Chief Executive Officer, a $50,000 retention bonus for Mr. Rodney S. Kenley, our President,
and a $50,000 retention bonus for Mr. James B. Frakes, our Chief Financial Officer.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In connection with the bonus granted to
Mr. Joyce, we entered into an amendment of Mr. Joyce&rsquo;s Employment Agreement dated April 1, 1999. Pursuant to the amendment,
if within two years of the effective date of the amendment, we terminate Mr. Joyce&rsquo;s employment with us for &ldquo;Cause&rdquo;
(as defined in his employment agreement) or Mr. Joyce terminates his employment with us other than for &ldquo;Good Reason&rdquo;
(as defined in his employment agreement), Mr. Joyce must repay in full the amount of the bonus received from us. In the event
of his death or disability or termination by us other than for &ldquo;Cause&rdquo; or termination by Mr. Joyce for &ldquo;Good
Reason,&rdquo; Mr. Joyce will not be required to repay any portion of the bonus received by him.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In connection with the bonus granted to
Mr. Kenley, we entered into an amendment of Mr. Kenley&rsquo;s Offer Letter dated October 27, 2010. Pursuant to the amendment,
if within two years of the effective date of the amendment, we terminate Mr. Kenley&rsquo;s employment with us for &ldquo;Cause&rdquo;
(as defined in the amendment) or Mr. Kenley terminates his employment with us other than for &ldquo;Good Reason&rdquo; (as defined
in the amendment), Mr. Kenley must repay in full the amount of the bonus received from us. In the event of his death or disability
or termination by us other than for &ldquo;Cause&rdquo; or termination by Mr. Kenley for &ldquo;Good Reason,&rdquo; Mr. Kenley
will not be required to repay any portion of the bonus received by him.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In connection with the bonus granted to
Mr. Frakes, we entered into a Retention Bonus Agreement with Mr. Frakes. Pursuant to the agreement, if within two years of the
effective date of the agreement, we terminate Mr. Frakes&rsquo; employment with us for &ldquo;Cause&rdquo; (as defined in the
agreement) or Mr. Frakes terminates his employment with us other than for &ldquo;Good Reason&rdquo; (as defined in the agreement),
Mr. Frakes must repay in full the amount of the bonus received from us. In the event of his death or disability or termination
by us other than for &ldquo;Cause&rdquo; or termination by Mr. Frakes for &ldquo;Good Reason,&rdquo; Mr. Frakes will not be required
to repay any portion of the bonus received by him.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Other Transactions</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Mr. Joyce received aggregate bonus payments
of $60,000 from Exosome throughout the fiscal years ended March 31, 2017 and March 31, 2016 per targets set by the Compensation
Committee.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Director Independence </B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Mr. Broenniman and Dr. Shah are independent
directors as that term is defined by NASDAQ Stock Market Rule 5605(a)(2). We currently have a compensation committee, a nominating
and corporate governance committee and an audit committee. Of the members of our Board of Directors, Mr. Broenniman and Dr. Shah
both meet the NASDAQ Stock Market's independence standards for members of such committees.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>




<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><A NAME="a56"></A><B>DESCRIPTION OF CAPITAL
STOCK</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>General</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our authorized capital consists of 10,000,000
shares of common stock, par value $0.001 per share. As of September 7, 2017, there were issued and outstanding <FONT STYLE="background-color: white">8,951,081
</FONT>shares of common stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Common Shares</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The holders of our common stock are entitled
to one vote (or consent) per share on all matters to be voted on by the stockholders. Holders of common stock are entitled to
receive ratably such dividends as may be declared by the Board of Directors out of funds legally available therefor. If we liquidate,
dissolve or wind up, holders of common stock are entitled to share ratably in all assets remaining after payment of all debts
and other liabilities. Holders of common stock have no preemptive, conversion or subscription rights. There are no redemption
or sinking fund provisions applicable to the common stock. All outstanding shares of common stock are, and all shares of common
stock to be outstanding upon completion of this offering will be, validly issued, fully paid and nonassessable.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Effective as of June 10, 2015, Section
6 of Article I of our Bylaws was amended and restated in its entirety as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">&ldquo; 6. Stockholders representing a majority of
the stock issued and outstanding, either in person or by proxy, shall constitute a quorum for the transaction of business at any
meeting of stockholders; <I>provided</I>, <I>however</I>, that at any time during which shares of the capital stock of the company
are listed for trading on the NASDAQ Stock Market, stockholders representing not less than thirty-three and one-third percent
(33 1/3%) of the common voting stock issued and outstanding, either in person or by proxy, shall constitute a quorum for the transaction
of business at any meeting of the holders of common stock.&rdquo;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Except as otherwise required by Nevada
law or as otherwise stated in our Bylaws, all stockholder action is taken by the vote of a majority of common stock voting as
a single class present at a meeting of stockholders at which a quorum consisting of a majority of the outstanding shares of common
stock is present in person or proxy.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Options and Warrants Convertible into Common Shares</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">As of June 30, 2017, there were outstanding
common share purchase options entitling the holders to purchase 414,547 common shares at a weighted average exercise price of
$11.24 per share and warrants entitling the holders to purchase up to 2,475,737 common shares at a weighted average exercise price
of $3.53 per share.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><A NAME="a57"></A><B>DESCRIPTION
OF SECURITIES WE ARE OFFERING</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><FONT STYLE="background-color: white">We
are offering (i) 4,777,070 units, each unit consisting of one share of our common stock and one common warrant to purchase one
share of our common stock, or (ii) up to 4,777,070 pre-funded units, each pre-funded unit consisting of one pre-funded warrant
to purchase one share of our common stock and one common warrant to purchase one share of our common stock. For each pre-funded
unit we sell, the number of units we are offering will be decreased on a one-for-one basis. The share of common stock and accompanying
common warrant included in each unit will be issued separately, and the pre-funded warrant to purchase one share of common stock
and the accompanying common warrant included in&nbsp;each pre-funded unit will be issued separately. Units will not be issued
or certificated. We are also registering the shares of common stock included in the units and the shares of common stock&nbsp;issuable
from time to time upon exercise of the pre-funded warrants included in pre-funded units and common warrants included in the units
and the pre-funded units&nbsp;offered hereby.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Common Stock</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The material terms and provisions of our
common stock and each other class of our securities which qualifies or limits our common stock are described under the caption
&ldquo;Description of Capital Stock&rdquo; in this prospectus.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"><B>Pre-Funded Warrants</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 5.2pt 0pt 0; text-indent: 46pt">&ldquo;Pre-funded&rdquo; warrants
provide any purchaser in this offering with the ability purchase more than 4.99% of our issued and outstanding stock . This is
accomplished through purchasing &ldquo;pre-funded&rdquo; warrants at a price equal to the purchase price for units, less $.01,
which $.01 is the exercise price for the &ldquo;pre-funded&rdquo; warrants. Each &ldquo;pre-funded&rdquo; unit is exerciseable
into a unit as offered hereunder. Thus, the purchaser is paying essentially the purchase price for a unit at closing of the offering
but is not deemed to beneficially own the shares of common stock included in the units until the purchaser exercises the &ldquo;pre-funded&rdquo;
warrant. Once purchased, the purchase price of the &ldquo;pre-funded&rdquo; warrants is not refundable. While the warrant permits
waiver of provisions by us and the holder of the warrant, this would not affect the &ldquo;pre-funding&rdquo; as that is the purchase
price of the instrument which is paid at the time of closing and becomes part of our proceeds received from the offering. In addition,
the pre-funded warrants are perpetual and do not have expiration date.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"><B><I>Duration and Exercise Price</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Each pre-funded warrant&nbsp;will have
an initial exercise price per share equal to $0.01. The pre-funded warrants will be immediately exercisable and may be exercised
at any time until the pre-funded warrants are exercised in full. The exercise price and number of shares of common stock issuable
upon exercise is subject to appropriate adjustment in the event of stock dividends, stock splits, reorganizations or similar events
affecting our common stock and the exercise price. The pre-funded warrants will be issued separately from the accompanying common
warrants included in the pre-funded units, and may be transferred separately immediately thereafter.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>




<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"><B><I>Exercisability</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The pre-funded warrants will be exercisable,
at the option of each holder, in whole or in part, by delivering to us a duly executed exercise notice accompanied by payment
in full for the number of shares of our common stock purchased upon such exercise (except in the case of a cashless exercise as
discussed below). A holder (together with its affiliates) may not exercise any portion of the pre-funded warrant to the extent
that the holder would own more than 4.99% of the outstanding common stock immediately after exercise, except that upon at least
61 days&rsquo; prior notice from the holder to us, the holder may increase the amount of ownership of outstanding stock after
exercising the holder&rsquo;s pre-funded warrants up to 9.99% of the number of shares of our common stock outstanding immediately
after giving effect to the exercise, as such percentage ownership is determined in accordance with the terms of the pre-funded
warrants. Purchasers of pre-funded units in this offering may also elect prior to the issuance of the pre-funded warrants to have
the initial exercise limitation set at 9.99% of our outstanding common stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"><B><I>Cashless Exercise</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">If, at the time a holder exercises its
pre-funded warrants, a registration statement registering the issuance of the shares of common stock underlying the pre-funded
warrants under the Securities Act is not then effective or available for the issuance of such shares, then in lieu of making the
cash payment otherwise contemplated to be made to us upon such exercise in payment of the aggregate exercise price, the holder
may elect instead to receive upon such exercise (either in whole or in part) the net number of shares of common stock determined
according to a formula set forth in the pre-funded warrants.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"><B><I>Transferability</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Subject to applicable laws, a pre-funded
warrant may be transferred at the option of the holder upon surrender of the pre-funded warrant to us together with the appropriate
instruments of transfer.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"><B><I>Fractional Shares</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">No fractional shares of common stock will
be issued upon the exercise of the pre-funded warrants. Rather, the number of shares of common stock to be issued will, at our
election, either be rounded up to the nearest whole number or we will pay a cash adjustment in respect of such final fraction
in an amount equal to such fraction multiplied by the exercise price.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"><B><I>Trading Market</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">There is no trading market available for
the pre-funded warrants on any securities exchange or nationally recognized trading system.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"><B><I>Right as a Stockholder</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Except as otherwise provided in the pre-funded
warrants or by virtue of such holder&rsquo;s ownership of shares of our common stock, the holders of the pre-funded warrants do
not have the rights or privileges of holders of our common stock, including any voting rights, until they exercise their pre-funded
warrants.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Warrants</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The following is a summary of all material
terms and provisions of the warrants that are being offered hereby, the form of which has been filed as an exhibit to the registration
statement of which this prospectus is a part. Prospective investors should carefully review the terms and provisions of the form
of warrant for a complete description of the terms and conditions of the warrants.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in"><I>Duration and Exercise Price</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Each warrant offered hereby will have an
exercise price equal to $_______. The warrants will be immediately exercisable and will expire on the fifth anniversary of the
original issuance date. The warrants will be issued separately from the common stock, and may be transferred separately immediately
thereafter. Warrants will be issued in certificated form only.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><I>Exercisability</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The warrants will be exercisable, at the
option of each holder, in whole or in part, by delivering to us a duly executed exercise notice accompanied by payment in full
for the number of shares of our common stock purchased upon such exercise (except in the case of a cashless exercise as discussed
below). A holder (together with its affiliates) may not exercise any portion of the warrant to the extent that the holder would
own more than 4.99% of the outstanding common stock after exercise, except that upon at least 61 days&rsquo; prior notice from
the holder to us, the holder may increase the amount of ownership of outstanding stock after exercising the holder&rsquo;s warrants
up to 9.99% of the number of shares of our common stock outstanding immediately after giving effect to the exercise, as such percentage
ownership is determined in accordance with the terms of the warrants.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in"><I>Cashless Exercise</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">If, at the time a holder exercises its
warrant, there is no effective registration statement registering, or the prospectus contained therein is not available for an
issuance of the shares underlying the warrant to the holder, then in lieu of making the cash payment otherwise contemplated to
be made to us upon such exercise in payment of the aggregate exercise price, the holder may elect instead to receive upon such
exercise (either in whole or in part) the net number of shares of common stock determined according to a formula set forth in
the warrant.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in"><I>Fundamental Transactions</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In the event of any fundamental transaction,
as described in the warrants and generally including any merger with or into another entity, sale of all or substantially all
of our assets, tender offer or exchange offer, or reclassification of our common stock, then upon any subsequent exercise of a
warrant, the holder will have the right to receive as alternative consideration, for each share of our common stock that would
have been issuable upon such exercise immediately prior to the occurrence of such fundamental transaction, the number of shares
of common stock of the successor or acquiring corporation or of our company, if it is the surviving corporation, and any additional
consideration receivable upon or as a result of such transaction by a holder of the number of shares of our common stock for which
the warrant is exercisable immediately prior to such event.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in"><I>Transferability</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Subject to applicable laws and a standard
legend with regard to restriction on transfer only in compliance with a public offering or an available exemption therefrom, the
warrant may be transferred at the option of the holder upon surrender of the warrant to us together with the appropriate instruments
of transfer.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in"><I>No Listing</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">There is no established trading market
for the warrants, and we do not expect an active trading market to develop. We do not intend to list the warrants on any securities
exchange or other trading market. Without a trading market, the liquidity of the warrants will be extremely limited.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in"><I>Right as a Shareholder</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Except as otherwise provided in the warrants
or by virtue of such holder&rsquo;s ownership of shares of our common stock, the holders of the warrants do not have the rights
or privileges of holders of our common stock, including any voting rights, until they exercise their warrants.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in"><I>Waivers and Amendments</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Subject to certain exceptions, any term
of the warrants may be amended or waived with our written consent and the written consent of the holders of at least a majority
of the then-outstanding warrants.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><A NAME="a58"></A><B>PLAN OF DISTRIBUTION</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Pursuant to an engagement agreement, we
have engaged H.C. Wainwright &amp; Co., LLC, or the placement agent, to act as our exclusive placement agent in connection with
this offering of our securities pursuant to this prospectus on a reasonable best efforts basis. The engagement agreement does
not give rise to any commitment by the placement agent to purchase any of our securities, and the placement agent will have no
authority to bind us by virtue of the engagement agreement. The placement agent may engage sub-agents or selected dealers to assist
with the offering.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The placement agent is not purchasing or
selling any of the securities offered by us under this prospectus, nor is it required to arrange the purchase or sale of any specific
number or dollar amount of securities. The placement agent has agreed to use reasonable best efforts to arrange for the sale of
the securities. There is no required minimum number of securities that must be sold as a condition to completion of this offering.
Further, the placement agent does not guarantee that it will be able to raise new capital in any prospective offering.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We will deliver the securities being issued
to the investors upon receipt of investor funds for the purchase of the securities offered pursuant to this prospectus. We expect
to deliver the securities being offered pursuant to this prospectus on or about ________. Investors purchasing a minimum of $500,000
of the securities offered hereby will have the option to execute a securities purchase agreement with us. This securities purchase
agreement, as well as the warrants offered hereunder, contain clauses which require the parties to waive
the right to trial by jury in any dispute between them and establish New York County, NY as the exclusive forum for resolution
of those disputes.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> In addition to rights and remedies available
to all purchasers in this offering under federal securities and state law, the purchasers which enter into a securities purchase
agreement will also be able to bring claims of breach of contract against us. The ability to pursue a claim for breach of contract
is material to larger purchasers in this offering as a means to enforce the following covenants uniquely available to them under
the securities purchase agreement: (i) timely delivery of shares; (ii) agreement to not enter into variable rate financings while
any warrants offered hereunder are outstanding; (iii) agreement to not enter into any financings for 90 days from closing; and
(iv) agreement not to enter into any stock splits for a year from closing. </P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The nature of the representations, warranties
and covenants in the securities purchase agreements shall include:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; background-color: white"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>standard
                                         issuer representations and warranties on matters such as organization, qualification,
                                         authorization, no conflict, no governmental filings required, current in SEC filings,
                                         no litigation, labor or other compliance issues, environmental, intellectual property
                                         and title matters and compliance with various laws such as the Foreign Corrupt Practices
                                         Act; and</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD><FONT STYLE="font-size: 10pt; color: windowtext">covenants
                                         regarding matters such as registration of warrant shares, no integration with other offerings,
                                         filing of an 8-K to disclose entering into these securities purchase agreements, no shareholder
                                         rights plans, no material nonpublic information, use of proceeds, indemnification of
                                         purchasers, reservation and listing of common stock, no subsequent equity sales for 90
                                         days and no stock splits for one year. </FONT></TD></TR></TABLE>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The following table shows the per unit
and total placement agent fees we will pay in connection with the sale of the securities in this offering, assuming the purchase
of all of the securities we are offering.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: top; text-align: left">
    <TD STYLE="width: 50%; text-align: center; border-bottom: Black 1pt solid">Per Unit</TD>
    <TD STYLE="width: 50%; text-align: center; border-bottom: Black 1pt solid">Per Pre-Funded Unit</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>Placement Agent Fees</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left; background-color: rgb(238,238,238)">
    <TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left; background-color: White">
    <TD>Total</TD>
    <TD>&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Fees and Expenses</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have agreed to pay the placement agent
a total cash fee equal to 6% of the gross proceeds of this offering and management fee of 1.0% of the gross proceeds of this offering
(which fees may be reduced under certain circumstances). We will also pay the placement agent a reimbursement for non-accountable
expenses of $50,000 and reimbursement for the placement agent's legal fees and expenses in the amount of up to $100,000. We estimate
the total offering expenses of this offering that will be payable by us, excluding the placement agent's fees, will be approximately
$250,000.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Right of First Refusal</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have also agreed to give the placement
agent, subject to the completion of this offering, certain rights of first refusal for a period of nine months with respect to
certain transactions, including any further capital raising transactions undertaken by us and right for a tail for a period of
six months.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"><B>Placement Agent Warrants</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In addition, we have agreed to issue to
the placement agent warrants to purchase up to 3.0% of the aggregate number of shares of common stock sold in the offering and
issuable upon the exercise of the pre-funded warrants at an exercise price of $1.96 per share (representing 125% of the assumed
public offering price for the shares), exercisable for five years from the date of the effectiveness of this offering. The placement
agent warrants will have substantially the same terms as the common warrants being sold to the investors in this offering. Pursuant
to FINRA Rule 5110(g), the placement agent warrants and any shares of common stock issued upon exercise of the placement agent
warrants shall not be sold, transferred, assigned, pledged, or hypothecated, or be the subject of any hedging, short sale, derivative,
put or call transaction that would result in the effective economic disposition of the securities by any person for a period of
180 days immediately following the date of effectiveness or commencement of sales of this offering, except the transfer of any
security: (i) by operation of law or by reason of our reorganization; (ii) to any FINRA member firm participating in the offering
and the officers or partners thereof, if all securities so transferred remain subject to the lock-up restriction set forth above
for the remainder of the time period; (iii) if the aggregate amount of our securities held by the placement agent or related persons
do not exceed 1% of the securities being offered; (iv) that is beneficially owned on a pro-rata basis by all equity owners of
an investment fund, provided that no participating member manages or otherwise directs investments by the fund and the participating
members in the aggregate do not own more than 10% of the equity in the fund; or (v) the exercise or conversion of any security,
if all securities remain subject to the lock-up restriction set forth above for the remainder of the time period.</P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Lock-Up Agreements</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our executive officers and directors have
agreed, subject to certain exceptions (such as shares underlying RSUs), not to offer, sell, agree to sell, directly or indirectly,
or otherwise dispose of shares of common stock or warrants or any other securities convertible into or exchangeable for shares
of common stock except for the shares of common stock included in the units and the shares of common stock&nbsp;issuable upon
exercise of the common warrants included in the units and the pre-funded units and the pre-funded warrants included in the pre-funded&nbsp;units&nbsp;offered
in this offering without the prior written consent of the placement agent for a period of 90 days after the consummation of this
offering. In addition, we have agreed, subject to certain exceptions, to not issue, enter into any agreement to issue or announce
the issuance or proposed issuance of any shares of common stock or common stock equivalents from the date of this prospectus until
60 days after the closing of this offering.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Indemnification</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have agreed to indemnify the placement
agent and specified other persons against certain liabilities relating to or arising out of the placement agent's activities under
the engagement agreement and to contribute to payments that the placement agent may be required to make in respect of such liabilities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Determination of Offering Price</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The offering price of the securities we
are offering was negotiated between us and the investors, in consultation with the placement agent based on the trading of our
securities prior to the offering, among other things. Other factors considered in determining the offering price of the securities
we are offering include the history and prospects of the company, the stage of development of our business, our business plans
for the future and the extent to which they have been implemented, an assessment of our management, general conditions of the
securities markets at the time of the offering and such other factors as were deemed relevant.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Listing</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our common stock is listed on The NASDAQ
Capital Market under the symbol &ldquo;AEMD.&rdquo;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Transfer Agent and Registrar</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The transfer agent and registrar for our
common stock is Computershare Investor Services. The transfer agent&rsquo;s address is P.O. Box 30170, College Station, TX 77842.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Other Relationships</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">From time to time, the placement agent
has provided, and may provide in the future, various advisory, investment and commercial banking and other services to us in the
ordinary course of business, for which they have received and may continue to receive customary fees and commissions. However,
except as disclosed in this prospectus, we have no present arrangements with the placement agent for any further services.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The placement agent acted as our exclusive
placement agent for our registered direct offering consummated in March 2017, for which it received compensation.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In addition, we have entered into a sales
agreement with the placement agent pursuant to which we may offer and sell shares of our common stock having an aggregate offering
price of up to $9,532,294 from time to time at prevailing market prices through the placement agent as our sales agent. As of
September 13,2017, an aggregate of $2,605,519 was sold. Sales under this sales agreement are suspended until closing of this offering.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><A NAME="a59"></A><B>LEGAL MATTERS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Jolie Kahn, Esq. has passed upon the validity
of the shares of common stock offered by this prospectus. Ellenoff Grossman &amp; Schole LLP will pass upon certain legal matters
for the placement agent.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><A NAME="a60"></A><B>EXPERTS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The consolidated financial statements of
Aethlon Medical, Inc. as of March 31, 2017 and 2016 and for each of the years in the two-year period ended March 31, 2017 have
been audited by Squar Milner LLP, an independent registered public accounting firm, as stated in their report thereon (which report
expresses an unqualified opinion and includes an explanatory paragraph relating to the Company&rsquo;s ability to continue as
a going concern), and included in this Prospectus and Registration Statement in reliance upon such report and upon the authority
of such firm as experts in accounting and auditing.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><A NAME="a61"></A><B>WHERE YOU CAN FIND
MORE INFORMATION</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have filed with the Securities and Exchange
Commission, or SEC, a registration statement on Form S-1 under the Securities Act of 1933 with respect to the shares of common
stock, warrants and pre-funded warrants offered hereby. This prospectus, which constitutes a part of the registration statement,
does not contain all of the information set forth in the registration statement or the exhibits filed with the registration statement.
For further information about us and the common stock and warrants offered hereby, we refer you to the registration statement
and the exhibits filed with the registration statement. Statements contained in this prospectus regarding the contents of any
contract or any other document that is filed as an exhibit to the registration statement are not necessarily complete, and each
such statement is qualified in all respects by reference to the full text of such contract or other document filed as an exhibit
to the registration statement. A copy of the registration statement and the filed exhibits may be inspected without charge at
the public reference room maintained by the SEC, located at 100 F Street, NE, Washington, DC 20549, and copies of all or any part
of the registration statement may be obtained from that office at prescribed rates. Please call the SEC at 1-800-SEC-0330 for
further information about the public reference room. The SEC also maintains a website that contains reports, proxy and information
statements and other information regarding registrants that file electronically with the SEC. The address of the website is <FONT STYLE="color: blue">www.sec.gov</FONT>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We are subject to the information and reporting
requirements of the Securities Exchange Act of 1934, or Exchange Act, and, in accordance with this law, are required to file periodic
reports, proxy statements and other information with the SEC. These periodic reports, proxy statements and other information are
available for inspection and copying at the SEC&rsquo;s public reference facilities and the website of the SEC referenced above.
We make available free of charge, on or through the investor relations section of our website, annual reports on Form 10-K, quarterly
reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a)
or 15(d) of the Exchange Act as soon as reasonably practicable after we electronically file such material with, or furnish it
to, the SEC. The information found on our website is not part of this prospectus.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">This prospectus includes statistical and
other industry and market data that we obtained from industry publications and research, surveys and studies conducted by third
parties. Industry publications and third-party research, surveys and studies generally indicate that they have gathered their
information from sources they believe to be reliable, although they do not guarantee the accuracy or completeness of such information.
While we believe that these industry publications and third-party research, surveys and studies are reliable, we have not independently
verified such data.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">AETHLON MEDICAL, INC. AND SUBSIDIARY</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><A NAME="a25"></A>INDEX TO CONSOLIDATED FINANCIAL
STATEMENTS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Page</B></FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Annual Consolidated Financial Statements
    </B></FONT></TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD><A HREF="#a28"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Report of Independent Registered
    Public Accounting Firm</FONT></A></TD>
    <TD STYLE="text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">F-2</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD><A HREF="#a29"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Consolidated Balance Sheets as
    of March 31, 2017 and 2016</FONT></A></TD>
    <TD STYLE="text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">F-3</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt"><A HREF="#a30"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Consolidated
    Statements of Operations for the Years Ended March 31, 2017 and 2016</FONT></A></TD>
    <TD STYLE="text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">F-4</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD><A HREF="#a31"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Consolidated Statements of Equity
    for the Years Ended March 31, 2017 and 2016</FONT></A></TD>
    <TD STYLE="text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">F-5</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt"><A HREF="#a32"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Consolidated
    Statements of Cash Flows for the Years Ended March 31, 2017 and 2016</FONT></A></TD>
    <TD STYLE="text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">F-6</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD><A HREF="#a33"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Notes to Consolidated Financial
    Statements</FONT></A></TD>
    <TD STYLE="text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">F-7</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD><B>Interim Condensed Consolidated Financial Statements (Unaudited) </B></TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD><A HREF="#a01">Condensed Consolidated Balance Sheets as of June 30, 2017 and March 31, 2017</A></TD>
    <TD STYLE="text-align: center">F-32</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD><A HREF="#a02">Condensed Consolidated Statements of Operations for the three months ended June 30, 2017 and 2016</A></TD>
    <TD STYLE="text-align: center">F-33</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD><A HREF="#a03">Condensed Consolidated Statements of Cash Flows for the three months ended June 30, 2017 and 2016</A></TD>
    <TD STYLE="text-align: center">F-34</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD><A HREF="#a04">Notes to Condensed Consolidated Financial Statements</A></TD>
    <TD STYLE="text-align: center">F-35</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><A NAME="a28"></A>REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">To the Board of Directors and Stockholders</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Aethlon Medical, Inc. and Subsidiary</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">We have audited the accompanying consolidated balance sheets of
Aethlon Medical, Inc. and Subsidiary (the &quot;Company&quot;) as of March 31, 2017 and 2016 and the related consolidated statements
of operations, equity, and cash flows for the years then ended. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial statements based on our audits.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">We conducted our audits in accordance with the standards of the
Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain
reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on
a test basis, evidence supporting the amounts and disclosures in the financial statements. The Company is not required to have,
nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of
internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances,
but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting.
Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management,
as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for
our opinion.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In our opinion, the consolidated financial statements referred
to above present fairly, in all material respects, the financial position of the Company as of March 31, 2017 and 2016, and the
results of their operations and their cash flows for the years then ended in conformity with U.S. generally accepted accounting
principles.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The accompanying financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, during the fiscal year
ended March 31, 2017 the Company incurred a net loss and generated negative cash flows from operating activity and as of March
31, 2017 had an accumulated deficit of approximately $93,778,000. These factors raise substantial doubt about the Company's ability
to continue as a going concern. Management's plans regarding these matters are also described in Note 1. The consolidated financial
statements do not include any adjustments that might result from the outcome of this uncertainty.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">/s/ SQUAR MILNER LLP</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">SAN DIEGO, CALIFORNIA</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">JUNE 28, 2017</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">AETHLON MEDICAL, INC. AND SUBSIDIARY</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><A NAME="a29"></A>CONSOLIDATED BALANCE SHEETS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">March 31, 2017</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">March 31, 2016</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: center">ASSETS</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">CURRENT ASSETS</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 66%; padding-left: 10pt">Cash</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">1,559,701</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">2,123,737</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 10pt">Accounts receivable</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">199,471</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 10pt">Prepaid expenses and other current assets</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">37,551</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">53,294</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; text-indent: 31.5pt">TOTAL CURRENT ASSETS</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">1,597,252</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">2,376,502</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">Property and equipment, net</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">29,223</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">36,038</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Patents, net</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">84,996</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">94,161</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-bottom: 1pt">Deposits</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">14,897</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">22,415</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; text-indent: 31.5pt">TOTAL ASSETS</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">1,726,368</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">2,529,116</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: center">LIABILITIES AND STOCKHOLDERS&rsquo; EQUITY</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">CURRENT LIABILITIES</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 10pt">Accounts payable</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">484,423</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">244,804</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-left: 10pt">Due to related parties</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">57,866</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">145,112</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 10pt">Other current liabilities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">69,467</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">136,695</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; text-indent: 31.5pt">TOTAL CURRENT LIABILITIES</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">611,756</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">526,611</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Convertible notes payable, net</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">519,200</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">500,139</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: 31.5pt">TOTAL LIABILITIES</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,130,956</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,026,750</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">COMMITMENTS AND CONTINGENCIES (Note 12)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">STOCKHOLDERS&rsquo; EQUITY</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-left: 20pt; text-indent: -10pt">Common stock, $0.001 par value, 30,000,000 shares authorized
    at March 31, 2017 and 2016; 8,797,086 and 7,622,393 issued and outstanding at March 31, 2017 and 2016, respectively</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8,796</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7,621</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 10pt">Additional paid-in capital</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">94,445,739</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">88,047,142</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 10pt">Accumulated deficit</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(93,778,156</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(86,502,043</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 10pt; text-indent: -10pt">TOTAL AETHLON MEDICAL, INC. STOCKHOLDERS&rsquo;
    EQUITY BEFORE NONCONTROLLING INTERESTS</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">676,379</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">1,552,720</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; text-indent: 13.5pt">NONCONTROLLING INTERESTS</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(80,967</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(50,354</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">TOTAL STOCKHOLDERS&rsquo; EQUITY</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">595,412</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">1,502,366</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">TOTAL LIABILITIES AND STOCKHOLDERS&rsquo; EQUITY</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">1,726,368</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">2,529,116</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">See accompanying notes to the consolidated
financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">AETHLON MEDICAL, INC. AND SUBSIDIARY</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><A NAME="a30"></A>CONSOLIDATED STATEMENTS OF
OPERATIONS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="text-align: center; border-bottom: Black 1pt solid">Years Ended March 31,</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">2017</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">2016</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>REVENUES:</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 66%; text-align: left; padding-bottom: 1pt; padding-left: 10pt">Government contract revenue</TD><TD STYLE="width: 2%; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="width: 13%; border-bottom: Black 1pt solid; text-align: right">392,073</TD><TD STYLE="width: 1%; padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="width: 13%; border-bottom: Black 1pt solid; text-align: right">886,572</TD><TD STYLE="width: 1%; padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-left: 20pt">Total revenues</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">392,073</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">886,572</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">OPERATING EXPENSES</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 10pt">Professional fees</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,161,592</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,259,096</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-left: 10pt">Payroll and related expenses</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,479,347</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,083,297</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 10pt">General and administrative</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">849,491</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">929,013</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 20pt">Total operating expenses</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">6,490,430</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">5,271,406</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">OPERATING LOSS</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(6,098,357</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(4,384,834</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">OTHER EXPENSE</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 10pt">Loss on debt extinguishment</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">558,198</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-left: 10pt">Warrant repricing expense</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">345,841</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 10pt">Interest and other expenses</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">304,330</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">573,782</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 20pt">Total other expense</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">1,208,369</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">573,782</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-left: 10pt; text-indent: -10pt">NET LOSS BEFORE NONCONTROLLING INTERESTS</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(7,306,726</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(4,958,616</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 10pt; text-indent: -10pt">LOSS ATTRIBUTABLE TO NONCONTROLLING
    INTERESTS</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(30,613</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(86,287</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 10pt; text-indent: -10pt">NET LOSS ATTRIBUTABLE TO COMMON
    STOCKHOLDERS</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(7,276,113</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(4,872,329</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 10pt; text-indent: -10pt">Basic and diluted net loss per
    share available to common stockholders</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(0.94</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(0.66</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 10pt; text-indent: -10pt">Weighted average number of common
    shares outstanding - basic and diluted</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">7,764,237</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">7,393,695</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">See accompanying notes to the consolidated
financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">AETHLON MEDICAL, INC. AND SUBSIDIARY</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><A NAME="a31"></A>CONSOLIDATED STATEMENTS OF
EQUITY</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">FOR THE YEARS ENDED MARCH 31, 2017 AND 2016</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 8pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: center; padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="14" STYLE="text-align: center; border-bottom: Black 1pt solid">ATTRIBUTABLE TO AETHLON MEDICAL, INC.</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: center; padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="6" STYLE="text-align: center; border-bottom: Black 1pt solid">COMMON STOCK</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">ADDITIONAL PAID IN</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">ACCUMULATED</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">NON-<BR> CONTROLLING</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 8pt">TOTAL</FONT></P></TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: center; padding-left: 10pt; text-indent: -10pt; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">SHARES</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">AMOUNT</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">CAPITAL</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">DEFICIT</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">INTERESTS</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">EQUITY</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 40%; padding-left: 5pt; text-indent: -5pt">BALANCE - MARCH 31, 2015</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 7%; text-align: right">6,657,046</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 7%; text-align: right">6,657</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 7%; text-align: right">82,238,507</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 7%; text-align: right">(81,629,714</TD><TD STYLE="width: 1%; text-align: left">)</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 7%; text-align: right">35,933</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 7%; text-align: right">651,383</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-left: 5pt; text-indent: -5pt">Issuances of common stock for cash</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">959,140</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">958</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,605,797</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,606,755</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-left: 5pt; text-indent: -5pt">Issuance of common stock under cashless warrant exercises</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,292</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(5</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-left: 5pt; text-indent: -5pt">Issuance of common stock due to rounding up from reverse split</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">915</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(1</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-left: 5pt; text-indent: -5pt">Stock-based compensation expense</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">202,844</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">202,844</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 10pt; text-indent: -10pt">Net loss</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(4,872,329</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(86,287</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(4,958,616</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-left: 5pt; text-indent: -5pt">BALANCE - MARCH 31, 2016</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7,622,393</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">7,621</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">88,047,142</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">(86,502,043</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">(50,354</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">1,502,366</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-left: 5pt; text-indent: -5pt">Issuances of common stock for cash under at the market program</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">216,078</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">216</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">954,889</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">955,105</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-left: 5pt; text-indent: -5pt">Issuances of common stock and warrants under registered direct financing</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">773,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">773</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,803,477</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,804,250</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-left: 5pt; text-indent: -5pt">Issuances of common stock under conversions of convertible notes and related
    accrued interest</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">33,091</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">33</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">144,686</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">144,719</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-left: 10pt; text-indent: -10pt">Warrant repricing expense</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">345,841</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">345,841</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-left: 10pt; text-indent: -10pt">Loss on debt extinguishment</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">558,198</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">558,198</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-left: 5pt; text-indent: -5pt">Debt discount on convertible notes payable</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">783,868</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">783,868</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-left: 10pt; text-indent: -10pt">Repurchase of restricted stock units</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">149,864</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">150</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(378,668</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(378,518</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">Exercise of cashless warrants</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,660</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(3</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-left: 10pt; text-indent: -10pt">Stock-based compensation expense</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,186,309</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,186,309</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 10pt; text-indent: -10pt">Net loss</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(7,276,113</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(30,613</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(7,306,726</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-bottom: 2.5pt; padding-left: 10pt; text-indent: -10pt">BALANCE - MARCH 31, 2017</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">8,797,086</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">8,796</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">94,445,739</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(93,778,156</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(80,967</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">595,412</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">See accompanying notes to the consolidated
financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">AETHLON MEDICAL, INC. AND SUBSIDIARY</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><A NAME="a32"></A>CONSOLIDATED STATEMENTS OF
CASH FLOWS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">FOR THE YEARS ENDED MARCH 31, 2017 AND 2016</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">2017</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">2016</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-left: 10pt; text-indent: -10pt">Cash flows from operating activities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 66%; text-align: left; padding-left: 20pt; text-indent: -10pt">Net loss</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">(7,306,726</TD><TD STYLE="width: 1%; text-align: left">)</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">(4,958,616</TD><TD STYLE="width: 1%; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-left: 20pt; text-indent: -10pt">Adjustments to reconcile net loss to net cash used in
    operating activities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 30pt; text-indent: -10pt">Depreciation and amortization</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">32,413</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">38,524</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-left: 30pt; text-indent: -10pt">Warrant repricing expense</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">345,841</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 30pt; text-indent: -10pt">Loss on debt extinguishment</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">558,198</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-left: 30pt; text-indent: -10pt">Stock based compensation</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,186,309</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">202,844</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 30pt; text-indent: -10pt">Amortization of debt discount and deferred financing
    costs</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">220,439</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">517,233</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 10pt; text-indent: -10pt">Changes in operating assets and liabilities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-left: 20pt; text-indent: -10pt">Accounts receivable</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">199,471</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(6,130</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 20pt; text-indent: -10pt">Prepaid expenses and other current assets</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">15,743</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">19,841</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-left: 20pt; text-indent: -10pt">Other assets</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7,518</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(95,638</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 20pt; text-indent: -10pt">Accounts payable and other current liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">322,140</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(46,365</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 20pt; text-indent: -10pt">Due to related parties</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(87,246</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(1,000</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 10pt; text-indent: -10pt">Net cash used in operating activities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(3,505,900</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(4,329,307</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 10pt; text-indent: -10pt">Cash flows from investing activities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 20pt; text-indent: -10pt">Purchases of property and equipment</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(16,433</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(9,307</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 10pt; text-indent: -10pt">Net cash used in investing activities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(16,433</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(9,307</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 10pt; text-indent: -10pt">Cash flows from financing activities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-left: 20pt; text-indent: -10pt">Cash paid for repurchase of restricted stock units</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(378,518</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 20pt; text-indent: -10pt">Proceeds from the issuance of convertible notes payable</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">577,460</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 20pt; text-indent: -10pt">Net proceeds from the issuance of
    common stock and warrants</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">2,759,355</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">5,606,755</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 10pt; text-indent: -10pt">Net cash provided by financing activities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">2,958,297</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">5,606,755</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 10pt; text-indent: -10pt">Net (decrease) increase in cash</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(564,036</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,268,141</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 10pt; text-indent: -10pt">Cash at beginning of year</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">2,123,737</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">855,596</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 10pt; text-indent: -10pt">Cash at end of year</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">1,559,701</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">2,123,737</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 10pt; text-indent: -10pt">Supplemental information of non-cash investing and financing
    activities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 20pt; text-indent: -10pt">Conversion of debt, accrued liabilities
    and accrued interest to common stock</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">144,719</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 20pt; text-indent: -10pt">Reclassification of accrued interest
    to convertible notes payable</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">85,031</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-bottom: 2.5pt; padding-left: 20pt; text-indent: -10pt">Issuance of shares for warrants</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">198</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 20pt; text-indent: -10pt">Issuance of shares under vested
    restricted stock units</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">150</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 20pt; text-indent: -10pt">Issuance of shares under cashless
    warrant exercises</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">3</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">5</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 20pt; text-indent: -10pt">Debt discount on convertible notes
    payable</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">783,868</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">See accompanying notes to the consolidated
financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Aethlon Medical, Inc. and Subsidiary</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><A NAME="a33"></A>Notes to Consolidated Financial
Statements</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">1. ORGANIZATION, LIQUIDITY AND SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">ORGANIZATION</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">We create medical technologies to address unmet needs in global
health and biodefense. The Aethlon Hemopurifier&reg; is a clinical-stage therapeutic device that eliminates life-threatening viruses
from the circulatory system of infected individuals. We believe the Aethlon Hemopurifier&reg; can achieve the broad-spectrum countermeasure
goal set forth by the U.S. Department of Health and Human Services (HHS). The device has been validated to capture Ebola, Zika,
Lassa, MERS-CoV, HIV, Hepatitis C, Cytomegalovirus, Epstein-Barr, Herpes Simplex, Chikungunya, Dengue, West Nile, Smallpox related
viruses, H1N1 Swine Flu, H5N1 Bird Flu, and the reconstructed Spanish flu virus of 1918. At present, the Hemopurifier&reg; is
being advanced under an FDA approved clinical study. Aethlon is also the majority owner of Exosome Sciences, Inc., a company focused
on the discovery of exosomal biomarkers to diagnose and monitor life-threatening diseases.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Aethlon Medical, Inc. and subsidiary (&ldquo;Aethlon&rdquo;, the
&ldquo;Company&rdquo;, &ldquo;we&rdquo; or &ldquo;us&rdquo;) is a medical device company focused on creating innovative devices
that address unmet medical needs in in global health and biodefense. The Aethlon Hemopurifier&reg; is a clinical-stage therapeutic
device that eliminates life-threatening viruses from the circulatory system of infected individuals. On June 25, 2013, the United
States Food and Drug Administration (FDA) approved an Investigational Device Exemption (IDE) that allows us to initiate human
feasibility studies of the Aethlon Hemopurifier&reg; in the U.S. We ended the treatment phase of the study after treating eight
end-stage renal disease patients who were infected with the Hepatitis C virus (HCV) to demonstrate the safety of Hemopurifier
therapy. Successful completion of this study will allow us the opportunity to initiate pivotal studies that are required for market
clearance to treat HCV and other disease conditions in the U.S.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Successful outcomes of human trials will also be required by the
regulatory agencies of certain foreign countries where we intend to sell this device. Some of our patents may expire before FDA
approval or approval in a foreign country, if any, is obtained. However, we believe that certain patent applications and/or other
patents issued more recently will help protect the proprietary nature of the Hemopurifier(R) treatment technology.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In October 2013, our subsidiary, Exosome Sciences, Inc. (&ldquo;ESI&rdquo;),
commenced operations with a focus on advancing exosome-based strategies to diagnose and monitor the progression of cancer, infectious
disease and other life-threatening conditions.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Our common stock is quoted on the Nasdaq Capital Market under the
symbol &ldquo;AEMD.&rdquo;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">REVERSE STOCK SPLIT</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">On April 14, 2015, the Company completed a 1-for-50 reverse stock
split. Accordingly, authorized common stock was reduced from 500,000,000 shares to 10,000,000 shares, and each 50 shares of outstanding
common stock held by stockholders were combined into one share of common stock. The accompanying consolidated financial statements
and accompanying notes have been retroactively revised to reflect such reverse stock split as if it had occurred on April 1, 2014.
All shares and per share amounts have been revised accordingly.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">LIQUIDITY AND GOING CONCERN</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The accompanying consolidated financial statements have been prepared
assuming that we will continue as a going concern, which contemplates, among other things, the realization of assets and satisfaction
of liabilities in the ordinary course of business. We have incurred continuing losses from operations and at March 31, 2017 had
an accumulated deficit of approximately $93,778,000. These factors, among other matters, raise substantial doubt about our ability
to continue as a going concern. A significant amount of additional capital will be necessary to advance the development of our
products to the point at which they may become commercially viable. We intend to fund operations, working capital and other cash
requirements for the fiscal year ending March 31, 2018 through debt and/or equity financing arrangements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">We are currently addressing our liquidity issue by seeking additional
investment capital through issuances of common stock under our existing S-3 registration statement and by applying for additional
grants issued by government agencies in the United States. We believe that our cash on hand and funds expected to be received
from additional debt and equity financing arrangements will be sufficient to meet our liquidity needs for fiscal 2018. However,
no assurance can be given that we will receive any funds in addition to the funds we have received to date.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">If we raise additional funds through the issuance of equity or
convertible debt securities, the percentage ownership of our current shareholders could be reduced, and such securities might
have rights, preferences or privileges senior to our common stock. Additional financing may not be available upon acceptable terms,
or at all. If adequate funds are not available or are not available on acceptable terms, we may not be able to take advantage
of prospective business endeavors or opportunities, which could significantly and materially restrict our operations. We are continuing
to pursue external financing alternatives to improve our working capital position. If we are unable to obtain the necessary capital,
we may have to cease operations.</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The successful outcome of future activities cannot be determined
at this time and there is no assurance that, if achieved, we will have sufficient funds to execute our intended business plan
or generate positive operating results.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The consolidated financial statements do not include any adjustments
related to this uncertainty and as to the recoverability and classification of asset carrying amounts or the amount and classification
of liabilities that might result should the Company be unable to continue as a going concern.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">PRINCIPLES OF CONSOLIDATION</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The accompanying consolidated financial statements include the
accounts of Aethlon Medical, Inc. and its majority-owned (80% ownership) and controlled subsidiary, Exosome Sciences, Inc. (ESI).
All significant intercompany balances and transactions have been eliminated in consolidation. The Company has classified the (20%
ownership) noncontrolling interests in ESI as part of consolidated net loss in the fiscal years ended March 31, 2017 and 2016
and includes the accumulated amount of noncontrolling interests as part of equity.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The losses at ESI during the fiscal year ended March 31, 2017 reduced
the noncontrolling interests on our consolidated balance sheet by $30,613 from $(50,354) at March 31, 2016 to $(80,967) at March
31, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">RISKS AND UNCERTAINTIES</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">We operate in an industry that is subject to intense competition,
government regulation and rapid technological change. Our operations are subject to significant risk and uncertainties including
financial, operational, technological, regulatory, and including the potential risk of business failure.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">USE OF ESTIMATES</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">We prepare our consolidated financial statements in conformity
with accounting principles generally accepted in the United States of America (&ldquo;GAAP&rdquo;), which requires management
to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets
and liabilities at the date of the consolidated financial statements and reported amounts of revenues and expenses during the
reporting periods. Significant estimates made by management include, among others, realization of long-lived assets, valuation
of derivative liabilities, estimating fair value associated with debt and equity transactions and valuation of deferred tax assets.
Actual results, whether in the near, medium or long-term future, could differ from those estimates.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">CASH AND CASH EQUIVALENTS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Accounting standards define &ldquo;cash and cash equivalents&rdquo;
as any short-term, highly liquid investment that is both readily convertible to known amounts of cash and so near their maturity
that they present insignificant risk of changes in value because of changes in interest rates. For the purpose of financial statement
presentation, we consider all highly liquid investment instruments with original maturities of three months or less when purchased,
or any investment redeemable without penalty or loss of interest to be cash equivalents. As of March 31, 2017 and 2016, we had
no assets that were classified as cash equivalents.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">FAIR VALUE OF FINANCIAL INSTRUMENTS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The carrying amount of our cash, accounts receivable, accounts
payable, and other current liabilities approximates their estimated fair values due to the short-term maturities of those financial
instruments. The carrying amount of the notes payable approximates their fair value due to the short maturity of the notes and
since the interest rates approximate current market interest rates for similar instruments.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Management has concluded that it is not practical to determine
the estimated fair value of amounts due to related parties because the transactions cannot be assumed to have been consummated
at arm's length, the terms are not deemed to be market terms, there are no quoted values available for these instruments, and
an independent valuation would not be practicable due to the lack of data regarding similar instruments, if any, and the associated
potential costs.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">We follow Financial Accounting Standard Board&rsquo;s (&ldquo;FASB&rdquo;)
Accounting Standards Codification (&ldquo;ASC&rdquo;) FASB ASC 820, &ldquo;Fair Value Measurements and Disclosures&rdquo; (&ldquo;ASC
820&rdquo;) in connection with financial assets and liabilities measured at fair value on a recurring basis subsequent to initial
recognition.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">ASC 820 requires that assets and liabilities carried at fair value
will be classified and disclosed in one of the following three categories:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Level 1: Quoted market prices in active markets for identical assets
or liabilities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Level 2: Observable market based inputs or unobservable inputs
that are corroborated by market data.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Level 3: Unobservable inputs that are not corroborated by market
data.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The hierarchy noted above requires us to minimize the use of unobservable
inputs and to use observable market data, if available, when determining fair value.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">We do not have any assets or liabilities that are measured at fair
value on a recurring basis and, during the years ended March 31, 2017 and 2016, and did not have any assets or liabilities that
were measured at fair value on a nonrecurring basis.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">CONCENTRATIONS OF CREDIT RISKS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Cash is maintained at one financial institution in checking accounts
and related cash management accounts. Accounts at this institution are secured by the Federal Deposit Insurance Corporation up
to $250,000. Our March 31, 2017 cash balances were approximately $1,308,000 over such insured amount. <FONT STYLE="background-color: white">We
do not believe that the Company is exposed to any significant risk with respect to its cash.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">All of our accounts receivable at March 31, 2017 and 2016 and all
of our revenue in the fiscal years ended March 31, 2017 and 2016 were directly from the U.S. Department of Defense or from a subcontract
under Battelle, which is a prime contractor with the U.S. Department of Defense.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">PROPERTY AND EQUIPMENT</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Property and equipment are stated at cost. Depreciation is computed
using the straight-line method over the estimated useful lives of the related assets, which range from two to five years. Repairs
and maintenance are charged to expense as incurred while improvements are capitalized. Upon the sale or retirement of property
and equipment, the accounts are relieved of the cost and the related accumulated depreciation with any gain or loss included in
the consolidated statements of operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">INCOME TAXES</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Deferred tax assets and liabilities are recognized for the future
tax consequences attributable to the difference between the consolidated financial statements and their respective tax basis.
Deferred income taxes reflect the net tax effects of (a) temporary differences between the carrying amounts of assets and liabilities
for financial reporting purposes and the amounts reported for income tax purposes, and (b) tax credit carryforwards. We record
a valuation allowance for deferred tax assets when, based on our best estimate of taxable income (if any) in the foreseeable future,
it is more likely than not that some portion of the deferred tax assets may not be realized.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">LONG-LIVED ASSETS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Long-lived assets are reviewed for impairment whenever events or
changes in circumstances indicate that their carrying amounts may not be recoverable. If the cost basis of a long-lived asset
is greater than the projected future undiscounted net cash flows from such asset, an impairment loss is recognized. We believe
no impairment charges were necessary during the fiscal years ended March 31, 2017 and 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">LOSS PER SHARE</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Basic loss per share is computed by dividing net income available
to common stockholders by the weighted average number of common shares outstanding during the period of computation. Diluted loss
per share is computed similar to basic loss per share except that the denominator is increased to include the number of additional
common shares that would have been outstanding if potential common shares had been issued, if such additional common shares were
dilutive. Since we had net losses for all periods presented, basic and diluted loss per share are the same, and additional potential
common shares have been excluded as their effect would be antidilutive.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">As of March 31, 2017 and 2016, a total of 3,908,292 and 2,710,107
potential common shares, consisting of shares underlying outstanding stock options, restricted stock units, warrants and convertible
notes payable were excluded as their inclusion would be antidilutive.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">SEGMENTS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Historically, we operated in one segment that was based on our
development of therapeutic devices. However, in the December 2013 quarter, we initiated the operations of ESI to develop diagnostic
tests. As a result, we now operate in two segments, Aethlon for therapeutic applications and ESI for diagnostic applications (See
Note 10).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">We record discrete financial information for ESI and our chief
operating decision maker reviews ESI&rsquo;s operating results in order to make decisions about resources to be allocated to the
ESI segment and to assess its performance.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">DEFERRED FINANCING COSTS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Costs related to the issuance of debt are capitalized as a deduction
to our convertible notes based on the new accounting standard on imputation of interest, and amortized to interest expense over
the life of the related debt using the effective interest method. We recorded amortization expense related to our deferred financing
costs of $27,641 and $144,683 during the fiscal years ended March 31, 2017 and 2016, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">REVENUE RECOGNITION</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">DARPA Contract -- We entered into a government contract with DARPA
and have recognized revenue of $387,438 and $863,011 under that contract during the fiscal years ended March 31, 2017 and 2016,
respectively. We adopted the Milestone method of revenue recognition for the DARPA contract under ASC 605-28 &ldquo;Revenue Recognition
&ndash; Milestone Method&rdquo; (&ldquo;ASC 605-28&rdquo;) and we believe we meet the requirements under ASC 605-28 for reporting
contract revenue under the Milestone Method for the fiscal years ended March 31, 2017 and 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">We identify the deliverables included within the contract and evaluate
which deliverables represent separate units of accounting based on if certain criteria are met, including whether the delivered
element has standalone value to the collaborator. The consideration received is allocated among the separate units of accounting,
and the applicable revenue recognition criteria are applied to each of the separate units.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">A milestone is an event having all of the following characteristics:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">(1) There is substantive uncertainty at the date the arrangement
is entered into that the event will be achieved. A vendor&rsquo;s assessment that it expects to achieve a milestone does not necessarily
mean that there is not substantive uncertainty associated with achieving the milestone.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">(2) The event can only be achieved based in whole or in part on
either: (a) the vendor&rsquo;s performance; or (b) a specific outcome resulting from the vendor&rsquo;s performance.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">(3) If achieved, the event would result in additional payments
being due to the vendor.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">A milestone does not include events for which the occurrence is
either: (a) contingent solely upon the passage of time; or (b) the result of a counterparty&rsquo;s performance.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; text-align: left; margin-bottom: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The policy for recognizing deliverable consideration contingent
upon achievement of a milestone must be applied consistently to similar deliverables.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The assessment of whether a milestone is substantive is performed
at the inception of the arrangement. The consideration earned from the achievement of a milestone must meet all of the following
for the milestone to be considered substantive:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">(1) The consideration is commensurate with either: (a) the vendor&rsquo;s
performance to achieve the milestone; or (b) the enhancement of the value of the delivered item or items as a result of a specific
outcome resulting from the vendor&rsquo;s performance to achieve the milestone;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">(2) The consideration relates solely to past performance; and</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">(3) The consideration is reasonable relative to all of the deliverables
and payment terms (including other potential milestone consideration) within the arrangement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">A milestone is not considered substantive if any portion of the
associated milestone consideration relates to the remaining deliverables in the unit of accounting (i.e., it does not relate solely
to past performance). To recognize the milestone consideration in its entirety as revenue in the period in which the milestone
is achieved, the milestone must be substantive in its entirety. Milestone consideration cannot be bifurcated into substantive
and nonsubstantive components. In addition, if a portion of the consideration earned from achieving a milestone may be refunded
or adjusted based on future performance, the related milestone is not considered substantive.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Battelle Subcontract -- We entered into a subcontract agreement
with Battelle Memorial Institute (&ldquo;Battelle&rdquo;) in March 2013. Battelle was chosen by DARPA to be the prime contractor
on the systems integration portion of the original DARPA contract and we are one of several subcontractors on that systems integration
project. The Battelle subcontract is cost-reimbursable under a time and materials basis. We began generating revenues under the
subcontract during the three months ended September 30, 2013 and for the fiscal years ended March 31, 2017 and 2016, we recorded
revenue of $4,635 and $23,561, respectively, under the Battelle subcontract.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Our revenue under this contract was a function of cost reimbursement
plus an overhead mark-up for hours devoted to the project by specific employees (with specific hourly rates for those employees).
Battelle engaged us as needed. Each payment required approval by the program manager at Battelle.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">STOCK-BASED COMPENSATION</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Employee stock options and rights to purchase shares under stock
participation plans are accounted for under the fair value method. Accordingly, share-based compensation is measured when all
granting activities have been completed, generally the grant date, based on the fair value of the award. The exercise price of
options is generally equal to the market price of the Company's common stock (defined as the closing price as quoted on the Nasdaq
Capital Market or OTCBB on the date of grant). Compensation cost recognized by the Company includes (a) compensation cost for
all equity incentive awards granted prior to April 1, 2006, but not yet vested, based on the grant-date fair value estimated in
accordance with the original provisions of the then current accounting standards, and (b) compensation cost for all equity incentive
awards granted subsequent to March 31, 2006, based on the grant-date fair value estimated in accordance with the provisions of
subsequent accounting standards. We use a Binomial Lattice option pricing model for estimating fair value of options granted (see
Note 5).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The following table summarizes share-based compensation expenses
relating to shares and options granted and the effect on loss per common share during the years ended March 31, 2017 and 2016:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="text-align: center; border-bottom: Black 1pt solid">Fiscal Years Ended</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">March 31, 2017</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">March 31, 2016</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 66%; text-align: left; padding-bottom: 1pt">Vesting of Stock Options and Restricted Stock Units</TD><TD STYLE="width: 2%; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="width: 13%; border-bottom: Black 1pt solid; text-align: right">2,186,309</TD><TD STYLE="width: 1%; padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="width: 13%; border-bottom: Black 1pt solid; text-align: right">202,844</TD><TD STYLE="width: 1%; padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Total Stock-Based Compensation Expense</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">2,186,309</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">202,844</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Weighted average number of common shares outstanding &ndash; basic and
    diluted</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">7,764,237</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">7,393,695</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Basic and diluted loss per common share</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(0.28</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(0.03</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">We account for transactions involving services provided by third
parties where we issue equity instruments as part of the total consideration using the fair value of the consideration received
(i.e. the value of the goods or services) or the fair value of the equity instruments issued, whichever is more reliably measurable.
In transactions, when the value of the goods and/or services are not readily determinable and (1) the fair value of the equity
instruments is more reliably measurable and (2) the counterparty receives equity instruments in full or partial settlement of
the transactions, we use the following methodology:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">a) For transactions where goods have already been delivered or
services rendered, the equity instruments are issued on or about the date the performance is complete (and valued on the date
of issuance).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">b) For transactions where the instruments are issued on a fully
vested, non-forfeitable basis, the equity instruments are valued on or about the date of the contract.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">c) For any transactions not meeting the criteria in (a) or (b)
above, we re-measure the consideration at each reporting date based on its then current stock value.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">We review share-based compensation on a quarterly basis for changes
to the estimate of expected award forfeitures based on actual forfeiture experience. The effect of adjusting the forfeiture rate
for all expense amortization after March 31, 2007 is recognized in the period the forfeiture estimate is changed. The effect of
forfeiture adjustments for the fiscal year ended March 31, 2017 was insignificant.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">PATENTS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Patents include both foreign and domestic patents. We capitalize
the cost of patents, some of which were acquired, and amortize such costs over the shorter of the remaining legal life or their
estimated economic life, upon issuance of the patent. The unamortized costs of patents are subject to our review for impairment
under our long-lived asset policy above.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">STOCK PURCHASE WARRANTS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">We grant warrants in connection with the issuance of convertible
notes payable and the issuance of common stock for cash. When such warrants are classified as equity and issued in connection
with debt, we measure the relative estimated fair value of such warrants and record it as a discount from the face amount of the
convertible notes payable. Such discounts are amortized to interest expense over the term of the notes using the effective interest
method. Warrants issued in connection with common stock for cash, if classified as equity, are considered issued in connection
with equity transactions and the warrant fair value is recorded to additional paid-in-capital.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">DERIVATIVE INSTRUMENTS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">We evaluate free-standing derivative instruments (or embedded derivatives)
to properly classify such instruments within equity or as liabilities in our financial statements. Our policy is to settle instruments
indexed to our common shares on a first-in-first-out basis.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The classification of a derivative instrument is reassessed at
each reporting date. If the classification changes as a result of events during a reporting period, the instrument is reclassified
as of the date of the event that caused the reclassification. There is no limit on the number of times a contract may be reclassified.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Instruments classified as derivative liabilities are remeasured
each reporting period (or upon reclassification) and the change in fair value is recorded on our consolidated statement of operations
in other (income) expense. We had no derivative liabilities at either March 31, 2017 or March 31, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">BENEFICIAL CONVERSION FEATURE OF CONVERTIBLE NOTES PAYABLE</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The convertible feature of certain notes payable provides for a
rate of conversion that is below market value. Such feature is normally characterized as a &quot;Beneficial Conversion Feature&quot;
(&quot;BCF&quot;). We measure the estimated fair value of the BCF in circumstances in which the conversion feature is not required
to be separated from the host instrument and accounted for separately, and record that value in the consolidated financial statements
as a discount from the face amount of the notes. Such discounts are amortized to interest expense over the term of the notes.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">RESEARCH AND DEVELOPMENT EXPENSES</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Our research and development costs are expensed as incurred. We
incurred approximately $673,000 and $782,000 of research and development expenses for the years ended March 31, 2017 and 2016,
respectively, which are included in various operating expenses in the accompanying consolidated statements of operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">OFF-BALANCE SHEET ARRANGEMENTS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">We have not entered into any off-balance sheet arrangements that
have or are reasonably likely to have a current or future material effect on our consolidated financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">SIGNIFICANT RECENT ACCOUNTING PRONOUNCEMENTS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">During the fiscal year ended March 31, 2017, we adopted Financial
Accounting Standards Board (&ldquo;FASB&rdquo;) Accounting Standards Update (&ldquo;ASU&rdquo;) 2015-03, the new accounting standard
on imputation of interest, simplifying the presentation of debt issuance costs. As a result of the adoption of that pronouncement,
our deferred financing costs at March 31, 2016 were reclassified from current assets to an offset against our convertible notes.
We did not have any unamortized deferred financing costs at March 31, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">During the fiscal year ended March 31, 2017, we also adopted
FASB ASU 2015-01, the new accounting standard on income statement - extraordinary and unusual items (Subtopic 225-20): simplifying
income statement presentation by eliminating the concept of extraordinary items and FASB ASU 2014-15, the new accounting standard
on the presentation of financial statements - going concern (Subtopic 205-40): disclosure of uncertainties about an entity's ability
to continue as a going concern.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The adoption of FASB ASU 2015-01 did not have a material impact
on our consolidated financial statements for the fiscal years ended March 31, 2016 and 2017 as we did not have any extraordinary
or unusual items in those fiscal years and we believe this accounting pronouncement will not have a significant impact on the
our consolidated financial statements in the future.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The adoption of FASB ASU 2014-15 did not have a material impact
on our consolidated financial statements for the fiscal years ended March 31, 2016 and 2017 as our management had determined that
a going concern qualification for both of those years was appropriate. We have evaluated the new going concern considerations
in this ASU and have determined that it is appropriate to provide additional disclosure to our consolidated financial statements
(see Note 1).</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Management is evaluating significant recent accounting pronouncements
that are not yet effective for us, including the new accounting standard on improvements to employee share based payment accounting,
ASU 2016-09 (Topic 718), the new accounting standard related to leases, ASU 2016-02 (Topic 842), the new accounting standard for
recognition and measurement of financial assets and financial liabilities, and the new accounting standard on revenue recognition,
ASU 2014-09 (Topic 606), and have not yet concluded whether any such pronouncements will have a significant effect on our future
consolidated financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">2. PROPERTY AND EQUIPMENT</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Property and equipment, net, consist of the following:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">March 31, 2017</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">March 31, 2016</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 66%; text-align: left">Furniture and office equipment, at cost</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">352,085</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">394,395</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Accumulated depreciation</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(322,862</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(358,357</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">29,223</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">36,038</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Depreciation expense for the years ended March 31, 2017 and 2016
approximated $23,000 and $29,000, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">3. PATENTS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Patents consist of the following:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">March 31, 2017</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">March 31, 2016</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 66%">Patents</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">211,645</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">211,645</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Accumulated amortization</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(126,649</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(117,484</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">84,996</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">94,161</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Amortization expense for patents for the years ended March 31,
2017 and 2016 approximated $9,000. Future amortization expense on patents is estimated to be approximately $9,000 per year based
on the estimated life of the patents. The weighted average remaining life of our patents is approximately 4.0 years.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">4. CONVERTIBLE NOTES PAYABLE</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Convertible Notes Payable, Net consisted of the following at March
31, 2017:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Principal</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Unamortized <BR> Discount</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Net <BR> Amount</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Accrued <BR> Interest</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">Convertible Notes Payable, Net &ndash; Non-Current Portion:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 48%">November 2014 10% Convertible Notes</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">612,811</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">(275,363</TD><TD STYLE="width: 1%; text-align: left">)</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">337,448</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">2,555</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-bottom: 1pt">December 2016 10% Convertible Notes</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">680,400</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(498,648</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">181,752</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">2,836</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Total Convertible Notes Payable, Net</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">1,293,211</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(774,011</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">519,200</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">5,391</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">During the fiscal year ended March 31, 2017, we recorded interest
expense of $81,102 related to the contractual interest rates of our convertible notes, interest expense of $27,641 related to
the amortization of deferred financing costs and interest expense of $192,798 related to the amortization of the note discount
for a total interest expense of $301,541 related to our convertible notes in the fiscal year ended March 31, 2017. All of the
unamortized discount at December 31, 2016 related to the note discount established upon the second amendment to the November 2014
10% Convertible Notes and to the December 2016 10% Convertible Notes (see below). Accrued interest is included in other current
liabilities (see Note 7).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Convertible Notes Payable, Net consisted of the following at March
31, 2016:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Principal</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Unamortized <BR> Discount</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Net <BR> Amount</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Accrued <BR> Interest</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">Convertible Notes Payable, Net&ndash; Non-Current Portion:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 48%; padding-bottom: 1pt">November 2014 10% Convertible Notes</TD><TD STYLE="width: 2%; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="width: 9%; border-bottom: Black 1pt solid; text-align: right">527,780</TD><TD STYLE="width: 1%; padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="width: 9%; border-bottom: Black 1pt solid; text-align: right">(27,641</TD><TD STYLE="width: 1%; padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="width: 2%; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="width: 9%; border-bottom: Black 1pt solid; text-align: right">500,139</TD><TD STYLE="width: 1%; padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="width: 9%; border-bottom: Black 1pt solid; text-align: right">74,036</TD><TD STYLE="width: 1%; padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Total Convertible Notes Payable, Net</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">527,780</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(27,641</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">500,139</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">74,036</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The above table shows the retroactive application of $27,641 in
note discounts representing the deferred financing costs of that same amount on March 31, 2016 due to the application of related
to the application of the new accounting standard ASU 2015-03. All of the unamortized discount at March 31, 2016 related to the
deferred financing costs noted above.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">During the fiscal year ended March 31, 2016, we recorded interest
expense of $52,778 related to the contractual interest rates of our convertible notes, interest expense of $372,550 related to
the amortization of debt discounts on the convertible notes and interest expense of $144,683 related to the amortization of deferred
financing costs for a total of $570,011. Accrued interest is included in other current liabilities (see Note 7).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">NOVEMBER 2014 10% CONVERTIBLE NOTES</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">In November 2014, we entered into a subscription agreement
with two accredited investors providing for the issuance and sale of (i) convertible promissory notes in the aggregate principal
amount of $527,780 (the &ldquo;Notes&rdquo;) and (ii) five-year warrants to purchase up to 47,125 shares of common stock at a
fixed exercise price of $8.40 per share (the &ldquo;Warrants&rdquo;). These Notes bear interest at the annual rate of 10% and
originally matured on April 1, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The aggregate gross cash proceeds to us were $415,000 after subtracting
legal fees of $35,000, a $27,780 due diligence fee and an original issuance discount of $50,000. We recorded deferred financing
costs of $112,780 to reflect the legal fees, due diligence fee and original issuance discount and will amortize those costs over
the life of the Notes using the effective interest method.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">These Notes are convertible at the option of the holders into shares
of our common stock at a fixed price of $5.60 per share, for up to an aggregate of 94,246 shares of common stock. There are no
registration requirements with respect to the shares of common stock underlying the Notes or the Warrants.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The estimated relative fair value of Warrants issued in connection
with the Notes was recorded as a debt discount and is amortized as additional interest expense over the term of the underlying
debt. We recorded debt discount of $240,133 based on the relative fair value of these Warrants. In addition, as the effective
conversion price of the Notes was less than market price of the underlying common stock on the date of issuance, we recorded an
additional debt discount of $287,647 related to the beneficial conversion feature.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>&nbsp;</B></P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>Initial Amendment of the November 2014 10% Convertible Note
Terms</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">On November 12, 2015, we entered into an amendment of terms (&ldquo;Amendment
of Terms&rdquo;) with the two investors that participated in the November 2014 10% Convertible Notes. The Amendment of Terms modified
the terms of the subscription agreement, Notes and Warrants held by those investors to, among other things, extended the maturity
date of the Notes from April 1, 2016 to June 1, 2016, temporarily reduced the number of shares that we must reserve with respect
to conversion of the Notes, and temporarily suspended the time period during which one of the investors may exercise its Warrants.
In exchange for the investors&rsquo; agreements in the Amendment of Terms, we paid one of the investors a cash fee of $90,000,
which we recorded as deferred financing costs and amortized over the remaining term of the notes.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>Second Amendment and Extension of the November 2014 10% Convertible
Notes</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">On June 27, 2016, we and certain investors entered into further
Amendments (the &ldquo;Amendments&rdquo;) to the Notes and the Warrants. The Amendments provide that the Maturity Date (as defined
in the Notes) was extended from June 1, 2016 to July 1, 2017 and that the conversion price per share of the Notes was reduced
from $5.60 per share of common stock to $5.00 per share of common stock. In addition, we reduced the purchase price (as defined
in the Warrants) from $8.40 per share to $5.00 per share of common stock. In connection with these modifications, each of the
investors signed a Consent and Waiver providing its consent under certain restrictive provisions, and waiving certain rights,
including a right to participate in certain offerings made by us, under a Securities Purchase Agreement dated June 23, 2015, (the
&ldquo;2015 SPA&rdquo;) to which we, the investors and certain other investors are parties, in order to facilitate an at-the-market
equity program (see Note 6).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The Amendments also increase the principal amount of the Notes
to $692,811 (in the aggregate) to (i)&nbsp;include accrued and unpaid interest through June 15, 2016, and (ii) increase the principal
amount by $80,000 (in the aggregate) as an extension fee for the extended maturity date of the Notes. With respect to each Note,
we entered into an Allonge to Convertible Promissory Note (each, an &ldquo;Allonge&rdquo;) reflecting the changes in the principal
amount, Maturity Date and conversion price of the Note.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">We also issued to the investors new warrants (the &ldquo;New Warrants&rdquo;)
to purchase an aggregate of 30,000 shares of common stock with a Purchase Price (as defined in the New Warrants) of $5.00 per
share of common stock. We issued the New Warrants in substantially the same form as the prior Warrants, and the New Warrants will
expire on November 6, 2019, the same date on which the prior Warrants will expire.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The modification of the Notes was evaluated under FASB Accounting
Standards Codification (&ldquo;ASC&rdquo;) Topic No. 470-50-40, &ldquo;Debt Modification and Extinguishments&rdquo;. Therefore,
according to the guidance, the instruments were determined to be substantially different, and the transaction qualified for extinguishment
accounting. As a result, we recorded a loss on debt extinguishment of $536,889 and recognized an extension fee expense of $80,000,
which are included in other (income) expenses in the accompanying condensed consolidated statements of operations. The debt extinguishment
is comprised from the fair value of prior warrants issued in connection with the Notes of $287,676, as well as $325,206 related
to beneficial conversion feature and offset by debt discount of $75,993. The beneficial conversion feature is a result of the
effective conversion price of the new Notes being less than the market price of the underlying common stock on the date of modification.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>Third Amendment and Extension of the November 2014 10% Convertible
Notes </B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In connection with the issuance of the December 2016 10% Convertible
Notes, the conversion price of the November 2014 10% Convertible Notes was reduced from $5.00 to $4.00 per share and the expiration
date of the November 2014 10% Convertible Notes was extended from July 1, 2017 to July 1, 2018.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The modification of the Notes was evaluated under FASB Accounting
Standards Codification (&ldquo;ASC&rdquo;) Topic No. 470-50-40, &ldquo;Debt Modification and Extinguishments&rdquo;. Therefore,
according to the guidance, the instruments were determined to be substantially different, and the transaction qualified for extinguishment
accounting. As a result, we recorded a gain on debt extinguishment of $58,691, which is included in other (income) expenses in
the accompanying condensed consolidated statements of operations. The recording of the modified Notes resulted in a beneficial
conversion of $233,748 which is the result of the effective conversion price of the new Notes being less than the market price
of the underlying common stock on the date of modification.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In June 2017, we agreed with the holders of the November 2014 10%
Convertible Notes to an extension of the expiration dates of the notes from July 1, 2018 to July 1, 2019 in exchange for the reduction
of the conversion price of those notes from $4.00 per share to $3.00 per share (See Note 11).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The following table shows the changes to the principal balance
of the November 2014 10% Convertible Notes:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD COLSPAN="5" STYLE="border-bottom: Black 1pt solid">Activity in the November 2014 10% Convertible Notes</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 87%; text-align: left">Initial principal balance</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">527,780</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 10pt; text-indent: -10pt">Increase in principal balance under the second amendment
    (see above)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">165,031</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 10pt; text-indent: -10pt">Conversions during the fiscal year
    ended March 31, 2017</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(80,000</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 2.5pt">Balance as of March 31, 2017</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">612,811</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">DECEMBER 2016 10% CONVERTIBLE NOTES</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In December 2016, we entered into a securities purchase agreement
(the &ldquo;Securities Purchase Agreement&rdquo;) with two accredited investors (collectively, the &ldquo;Holders&rdquo;), pursuant
to which the Holders purchased an aggregate of $680,400 principal amount of Notes (inclusive of due diligence fee of $30,000 deemed
paid as a subscription amount in the form of a Note in the principal amount of $32,400) for an aggregate cash subscription amount
of $600,000 and (b) warrants to purchase 127,575 shares of Common Stock (collectively, the &ldquo;Warrants&rdquo;).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The Notes bear interest at the rate of 10% per annum, and the principal
amount and all accrued and unpaid interest thereon is convertible into shares of our common stock at a $4.00 per share conversion
price, which is subject to customary adjustment provisions for stock splits, dividends, recapitalizations and the like. The Notes
mature on July 1, 2018 and are subject to customary and usual terms for events of default and the like. Each Holder has contractually
agreed to restrict its ability to convert its Note such that the number of shares of the Common Stock held by the Holder and its
affiliates after such exercise does not exceed 4.99% of our then issued and outstanding shares of Common Stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The Warrants issued to the Holders are exercisable for a period
of five years from the date of issuance at an exercise price of $4.50, subject to adjustment. A Holder may exercise a Warrant
by paying the exercise price in cash or by exercising the Warrant on a cashless basis. In the event a Holder exercises a Warrant
on a cashless basis, we will not receive any proceeds. The exercise price of the Warrants is subject to customary adjustments
provision for stock splits, stock dividends, recapitalizations and the like. Each Holder has contractually agreed to restrict
its ability to exercise its Warrant such that the number of shares of the Common Stock held by the Holder and its affiliates after
such exercise does not exceed 4.99% of our then issued and outstanding shares of Common Stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The estimated relative fair value of Warrants issued in connection
with the Notes was recorded as a debt discount and is being amortized as additional interest expense over the term of the underlying
debt. We recorded debt discount of $232,718 based on the relative fair value of these Warrants. In addition, as the effective
conversion price of the Notes was less than market price of the underlying common stock on the date of issuance, we recorded an
additional debt discount of $262,718 related to the beneficial conversion feature. We also recorded deferred financing costs of
$102,940, which was composed of an 8% original issue discount of $50,400, a $30,000 due diligence fee (which was paid in the form
of a note), $22,500 in legal fees, and a $40 bank charge. The combination of the above items led to a combined discount against
the convertible notes of $598,376.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In June 2017, we agreed with the holders of the December 2016 10%
Convertible Notes to an extension of the expiration dates of the notes from July 1, 2018 to July 1, 2019 in exchange for the reduction
of the conversion price of those notes from $4.00 per share to $3.00 per share (See Note 11).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">There were no conversions of principal on the December 2016 10%
Convertible Notes during the fiscal year ended March 31, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">5. EQUITY TRANSACTIONS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">ISSUANCES OF COMMON STOCK AND WARRANTS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><I>Equity Transactions in the Fiscal Year Ended March 31, 2017.</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>Common Stock Sales Agreement with H.C. Wainwright</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">On June 28, 2016, we entered into a Common Stock Sales Agreement
(the &ldquo;Agreement&rdquo;) with H.C. Wainwright &amp; Co., LLC (&ldquo;H.C. Wainwright&rdquo;) which establishes an at-the-market
equity program pursuant to which we may offer and sell shares of our common stock from time to time as set forth in the Agreement.
The Agreement provides for the sale of shares of our common stock having an aggregate offering price of up to $12,500,000 (the
&ldquo;Shares&rdquo;).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Subject to the terms and conditions set forth in the Agreement,
H.C. Wainwright will use its commercially reasonable efforts consistent with its normal trading and sales practices to sell the
Shares from time to time, based upon our instructions. We have provided H.C. Wainwright with customary indemnification rights,
and H.C. Wainwright will be entitled to a commission at a fixed rate equal to three percent (3.0%) of the gross proceeds per Share
sold. In addition, we have agreed to pay certain expenses incurred by H.C. Wainwright in connection with the Agreement, including
up to $50,000 of the fees and disbursements of their counsel. The Agreement will terminate upon the sale of all of the Shares
under the Agreement unless terminated earlier by either party as permitted under the Agreement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Sales of the Shares, if any, under the Agreement shall be made
in transactions that are deemed to be &ldquo;at the market offerings&rdquo; as defined in Rule 415 under the Securities Act, including
sales made by means of ordinary brokers&rsquo; transactions, including on the Nasdaq Capital Market, at market prices or as otherwise
agreed with H.C. Wainwright. We have no obligation to sell any of the Shares, and, at any time, we may suspend offers under the
Agreement or terminate the Agreement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In July 2016, we commenced sales of common stock under our Common
Stock Sales Agreement with H.C. Wainwright. In the fiscal year ended March 31, 2017, we raised aggregate net proceeds of $955,206
(net of $29,831 in commissions to H.C. Wainwright and $9,432 in other offering expenses) under this agreement through the sale
of 216,078 shares at an average price of $4.42 per share of net proceeds.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>Warrant Issuances in July 2016 </B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In July 2016, we issued an aggregate of 2,660 shares of common
stock to three investors upon the exercise of previously issued warrants. The warrants were exercised on a cashless or &ldquo;net&rdquo;
basis. Accordingly, we did not receive any proceeds from such exercises. The cashless exercise of such warrants resulted in the
cancellation of previously issued warrants to purchase an aggregate of 19,563 shares of common stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>Restricted Stock Unit Grants to Directors and Executive Officers</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">During the fiscal year ended March 31, 2017, 149,864 Restricted
Stock Units (&ldquo;RSUs&rdquo;) held by our outside directors and executive officers were exchanged into the same number of shares
of our common stock (see Stock-Based Compensation below).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>Amendment of Warrants Issued in Conjunction with the November
2014 10% Convertible Notes</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Under the Second Amendment and Extension of the November 2014 10%
Convertible Notes dated June 27, 2016 (See Note 4), we reduced the purchase price of 47,125 Warrants from $8.40 per share to $5.00
per share. &nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">We also issued to the investors new warrants to purchase an aggregate
of 30,000 shares of common stock with a purchase price of $5.00 per share of common stock. We issued the new warrants in substantially
the same form as the prior Warrants, and the new warrants will expire on November 6, 2019, the same date on which the prior warrants
will expire (See Note 4).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>&nbsp;</B></P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>Amendment of December 2014 Warrants</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">On June 27, 2016, we and certain investors (the &ldquo;Unit Investors&rdquo;)
entered into Consent and Waiver and Amendment agreements (the &ldquo;CWAs&rdquo;), relating to an aggregate of 264,000 Warrants
to Purchase Common Stock (the &ldquo;Unit Warrants&rdquo;) we had issued to the Unit Investors on December 2, 2014 pursuant to
a Securities Purchase Agreement dated November 26, 2014 (the &ldquo;2014 SPA&rdquo;). In the CWAs, each of the Unit Investors
provided its consent under certain restrictive provisions, and waived certain rights, including a right to participate in certain
offerings made by us, under the 2014 SPA in order to facilitate the at-the-market equity program described above. Pursuant to
the CWAs, we reduced the Exercise Price (as defined in the Unit Warrants) from $15.00 per share of common stock to $5.00 per share
of common stock. At any time that the shares of common stock underlying the Unit Warrants are covered by an effective registration
statement that permits the public resale of the shares, if the Unit Investors exercise the Unit Warrants, they must do so by a
cash exercise, which could yield up to $1,320,000 in proceeds to us.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">On June 27, 2016, each of the Unit Investors also entered into
a Consent and Waiver providing its consent under certain provisions, and waiving certain rights, including a right to participate
in certain offerings made by us, under the 2015 SPA in order to facilitate the at-the-market equity program described above.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In accordance with applicable GAAP for warrant modifications, we
measured the change in fair value that arose from the reduction in exercise price and recognized an expense of $345,841, which
is included in other (income) expenses in the accompanying condensed consolidated statements of operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>Warrants Issued in Conjunction with the December 2016 10% Convertible
Notes</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">On December 30, 2016, we entered into a securities purchase agreement
(the &ldquo;Securities Purchase Agreement&rdquo;) with two accredited investors (collectively, the &ldquo;Holders&rdquo;), pursuant
to which the Purchasers purchased an aggregate of $680,400 principal amount of Notes (inclusive of due diligence fee of $30,000
deemed paid as a subscription amount in the form of a Note in the principal amount of $32,400) for an aggregate cash subscription
amount of $600,000 and (b) warrants to purchase 127,575 shares of Common Stock (collectively, the &ldquo;Warrants&rdquo;) (See
Note 4).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The Warrants issued to the Holders are exercisable for a period
of five years from the date of issuance at an exercise price of $4.50, subject to adjustment. A Holder may exercise a Warrant
by paying the exercise price in cash or by exercising the Warrant on a cashless basis. In the event a Holder exercises a Warrant
on a cashless basis, we will not receive any proceeds. The exercise price of the Warrants is subject to customary adjustments
provision for stock splits, stock dividends, recapitalizations and the like. Each Holder has contractually agreed to restrict
its ability to exercise its Warrant such that the number of shares of the Common Stock held by the Holder and its affiliates after
such exercise does not exceed 4.99% of our then issued and outstanding shares of Common Stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The estimated relative fair value of Warrants issued in connection
with the Notes was recorded as a debt discount and is amortized as additional interest expense over the term of the underlying
debt. We recorded debt discount of $232,718 based on the relative fair value of these Warrants.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">MARCH 2017 EQUITY FINANCING</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">On March 22, 2017, we entered into a Securities Purchase Agreement
(the &ldquo;Purchase Agreement&rdquo;) with certain institutional investors (the &ldquo;Investors&rdquo;) for the sale of 575,000
shares (the &ldquo;Common Shares&rdquo;) of our common stock, par value $0.001 per share (the &ldquo;Common Stock&rdquo;), at
a purchase price of $3.50 per share, in a registered direct offering. Concurrently with the sale of the Common Shares, pursuant
to the Purchase Agreement, we also sold in a private placement warrants to purchase 575,000 shares of Common Stock (the &ldquo;Warrants&rdquo;).
The aggregate gross proceeds for the sale of the Common Shares and Warrants will be approximately $2 million.&nbsp; Subject to
certain ownership limitations, the Warrants will be initially exercisable commencing six months from the issuance date at an exercise
price equal to $3.95 per share of Common Stock, subject to adjustments as provided under the terms of the Warrants. The Warrants
will be exercisable for five years from the initial exercise date.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The net proceeds to us from the transactions, after deducting the
placement agent&rsquo;s fees and expenses (not including the Wainwright Warrants, as defined below), our estimated offering expenses,
and excluding the proceeds, if any, from the exercise of the Warrants, were $1,804,250. We intend to use the net proceeds from
the transactions for general corporate purposes.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The Common Shares (but not the Warrants or shares issuable upon
exercise of the Warrant) were sold by us pursuant to an effective shelf registration statement on Form&nbsp;S-3, which was filed
with the Securities and Exchange Commission (the &ldquo;SEC&rdquo;) on May&nbsp;5, 2016 and subsequently declared effective on
May 12, 2016 (File No.&nbsp;333-211151) (the &ldquo;Registration Statement&rdquo;), and the base prospectus dated as of May 12,
2016 contained therein. We filed a prospectus supplement and the accompanying prospectus with the SEC in connection with this
sale of the Common Shares.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The purchase agreement also covered the exchange of 264,000 warrants
issued to the purchasers thereunder in December 2014 for 198,000 shares of our common stock. Further, in exchange for certain
waivers given by the purchasers and certain other investors in a private placement of the Company in June 2015, the&nbsp;warrants
issued in such private placement were amended to (i) reduce the exercise price to $3.95 per share, (ii) make the warrants non-exercisable
for a period of six months from the date of amendment, and (iii) extend the term of those warrants by six months. As all of these
warrant-related elements were integral to the March 2017 Equity Financing, we accounted for all of these elements as adjustments
to additional paid-in capital.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The Warrants and the shares issuable upon exercise of the Warrants
were sold and issued without registration under the Securities Act of 1933 (the &ldquo;Securities Act&rdquo;) in reliance on the
exemptions provided by Section&nbsp;4(a)(2)&nbsp;of the Securities Act as transactions not involving a public offering and Rule&nbsp;506
promulgated under the Securities Act as sales to accredited investors, and in reliance on similar exemptions under applicable
state laws.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">We also entered into an engagement letter (the &ldquo;Engagement
Letter&rdquo;) with Rodman &amp; Renshaw, a unit of H.C. Wainwright&nbsp;&amp; Co., LLC (&ldquo;Rodman&rdquo;), pursuant to which
Rodman agreed to serve as exclusive placement agent for the issuance and sale of the Common Shares and Warrants. We paid Rodman
an aggregate fee equal to 6% of the gross proceeds received by us from the sale of the securities in the transactions. Pursuant
to the Engagement Letter, we also agreed to grant to Rodman or its designees warrants to purchase up to 3% of the aggregate number
of shares sold in the transaction (the &ldquo;Rodman Warrants&rdquo;). The Engagement Letter has a nine-month tail and right of
first offer periods, indemnity and other customary provisions for transactions of this nature. The Rodman Warrants have substantially
the same terms as the Warrants, except that the exercise price is 125% of $3.50. We also paid Rodman a reimbursement for non-accountable
expenses in the amount of $50,000.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><I>Equity Transactions in the Fiscal Year Ended March 31, 2016.</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><I>&nbsp;</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">REVERSE STOCK SPLIT</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">On April 14, 2015, we completed a 1-for-50 reverse stock split.
Accordingly, authorized common stock was reduced from 500,000,000 shares to 10,000,000 shares, and each 50 shares of outstanding
common stock held by stockholders were combined into one share of common stock. The accompanying condensed consolidated financial
statements and accompanying notes have been retroactively revised to reflect such reverse stock split as if it had occurred on
April 1, 2014. All share and per share amounts have been revised accordingly.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">INCREASE IN AUTHORIZED SHARES</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">On March 31, 2016, we filed a Certificate of Amendment to our Articles
of Incorporation to increase our authorized common stock from 10,000,000 to 30,000,000 shares. Our stockholders approved the amendment
at our annual meeting of stockholders held on March 29, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">On April 28, 2015, we issued 915 shares of common stock as the
result of rounding up of fractional shares that arose due to our reverse stock split.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">On June 25, 2015, we sold $6,000,000 of units, comprised of common
stock and warrants, to 18 accredited investors at a price of $6.30 per unit. Each unit consisted of one share of common stock
and 0.75 of a five-year warrant to purchase one share of common stock at an exercise price of $6.30 per share. Accordingly, we
issued a total of 952,383 shares of unregistered common stock and warrants to purchase 714,285 shares of common stock. For its
services as sole placement agent for the financing, we paid Roth Capital Partners, LLC (&ldquo;Roth&rdquo;) a cash fee of $285,512
and expense reimbursement of $75,000 and we issued them a five-year warrant to purchase 32,371 shares of common stock at an exercise
price of $6.30 per share. We received $5,591,988 in net proceeds from this financing. The warrant fair value, which was valued
using a binomial lattice model, was recorded to additional paid-in-capital.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In connection with the financing, Mr. James Joyce, our Chief Executive
Officer, Mr. James Frakes, our Chief Financial Officer and Dr. Chetan Shah, a director of our company, each agreed to waive their
right to exercise certain stock options and warrants held by them representing the right to acquire 402,318 shares of common stock
in the aggregate (the &ldquo;Waivers&rdquo;). The Waivers were required in order to make a sufficient number of shares of common
stock available for issuance and the Waivers expired when we amended our Articles of Incorporation on March 31, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">During the three months ended September 30, 2015, we issued an
aggregate of 5,292 shares of common stock to an accredited investor upon the exercise of previously issued warrants. The warrants
were exercised on a cashless or &ldquo;net&rdquo; basis. Accordingly, we did not receive any proceeds from such exercises. The
cashless exercise of such warrants resulted in the cancellation of previously issued warrants to purchase an aggregate of 1,744
shares of common stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">During the three months ended December 31, 2015, we issued an aggregate
of 6,757 unregistered shares of common stock to two investors upon the exercise of previously issued warrants. The warrants were
exercised for cash and we received cash proceeds of $14,766 for an average purchase price of $2.19 per share per the terms of
the warrants.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">WARRANTS:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">During the fiscal year ended March 31, 2017, we issued warrants
in connection with three financing arrangements. The first warrant issuance during the fiscal year was the issuance of 30,000
warrants with an exercise price of $5.00 per share in June 2016.&nbsp;Those 30,000 warrants were issued in connection with the
Amendment of November 2014 Investment Documents (see Note 4).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The second warrant issuance was the issuance of 127,575 warrants
with an exercise price of $4.50 per share in December 2016. Those 127,575 warrants were issued in connection with the issuance
of our December 2016 10% Convertible Notes (see Note 4).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The third warrant issuance during the fiscal year was our March
22, 2017 equity financing with certain institutional investors (the &ldquo;Investors&rdquo;) for the sale of 575,000 shares (the
&ldquo;Common Shares&rdquo;) of our common stock, par value $0.001 per share (the &ldquo;Common Stock&rdquo;), at a purchase price
of $3.50 per share, in a registered direct offering. Concurrently with the sale of the Common Shares, pursuant to the Purchase
Agreement, we also sold in a private placement warrants to purchase 575,000 shares of Common Stock (the &ldquo;Warrants&rdquo;).
Subject to certain ownership limitations, the Warrants will be initially exercisable commencing six months from the issuance date
at an exercise price equal to $3.95 per share of Common Stock, subject to adjustments as provided under the terms of the Warrants.
The Warrants will be exercisable for five years from the initial exercise date.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The purchase agreement also covered the exchange of 264,000 warrants
issued to the purchasers thereunder in December 2014 for 198,000 shares of our common stock. Further, in exchange for certain
waivers given by the purchasers and certain other investors in a private placement of the Company in June 2015, the&nbsp;warrants
issued in such private placement were amended to (i) reduce the exercise price to $3.95 per share, (ii) make the warrants non-exercisable
for a period of six months from the date of amendment, and (iii) extend the term of those warrants by six months.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">We also entered into an engagement letter (the &ldquo;Engagement
Letter&rdquo;) with Rodman &amp; Renshaw, a unit of H.C. Wainwright&nbsp;&amp; Co., LLC (&ldquo;Rodman&rdquo;), pursuant to which
Rodman agreed to serve as exclusive placement agent for the issuance and sale of the Common Shares and Warrants. In addition to
a cash placement fee equal to 6% of the gross proceeds received by us from the sale of the securities in the transaction, we also
agreed to grant to Rodman or its designees warrants to purchase up to 3% of the aggregate number of shares sold in the transaction
(the &ldquo;Rodman Warrants&rdquo;). The Rodman Warrants have substantially the same terms as the Warrants, except that the exercise
price is 125% of $3.50. &nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Based on the above assumptions, we valued the warrants issued during
the fiscal year ended March 31, 2017 as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 24px">&nbsp;</TD>
    <TD STYLE="width: 24px"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&bull;</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The 30,000 warrants issued in June 2016 were
    valued at $111,900 and we classified that fair value as equity.</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 24px">&nbsp;</TD>
    <TD STYLE="width: 24px">&bull;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The 127,575 warrants issued in December 2016
    were valued at $380,174 and we classified $232,718 of that fair value as debt discount and the remainder as equity.</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&bull;</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The 575,000 warrants issued in March 2017 were
    valued at $1,493,390 and we classified that fair value as equity.</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&bull;</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In connection with our March 2017 financing,
    we agreed to reduce the exercise price on 547,620 warrants from $6.30 to $3.44. We valued the change in fair value due to
    the change in exercise price at $219,048 and classified that fair value as equity.</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&bull;</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Also in connection with our March 2017 financing,
    we agreed with the investor in that financing to exchange 198,000 shares for the return and cancellation of 264,000 warrants.
    We calculated the fair value of those 264,000 warrants at $528,000 and classified the impact of this share for warrant exchange
    as equity due to the integral connection with the March 2017 financing.</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">A summary of the aggregate warrant activity for the years ended
March 31, 2017 and 2016 is presented below:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="14" STYLE="text-align: center; border-bottom: Black 1pt solid">Fiscal Year Ended March 31,</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="text-align: center; border-bottom: Black 1pt solid">2017</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="text-align: center; border-bottom: Black 1pt solid">2016</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Warrants</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Weighted <BR> Average<BR> Exercise Price</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Warrants</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Weighted <BR> Average<BR> Exercise Price</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 48%; text-align: left">Outstanding, beginning of year</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">2,164,094</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">6.68</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">1,430,738</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">6.84</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>Granted</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">749,825</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">4.10</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">746,657</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">6.30</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>Exercised</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(2,660</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">6.25</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(12,049</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">2.15</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1pt">Cancelled/Forfeited</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(307,163</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">5.18</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(1,252</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">2.10</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Outstanding, end of year</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">2,604,096</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">3.64</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">2,164,094</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">6.68</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Exercisable, end of year</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">2,604,096</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">3.64</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">2,164,094</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">6.68</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-bottom: 2.5pt">Weighted average estimated fair value of warrants granted</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">2.65</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">5.11</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The following outlines the significant weighted average assumptions
used to estimate the fair value of warrants granted utilizing the Binomial Lattice option pricing model:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center; border-bottom: Black 1pt solid">Year Ended March 31,</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: center; border-bottom: Black 1pt solid">2017</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: center; border-bottom: Black 1pt solid">2016</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 64%; text-align: left">Risk free interest rate</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 16%; text-align: center">0.7% - 1.93%</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 16%; text-align: center">1.70%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>Average expected life</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">3.42 &ndash; 5.5 years</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">5 years</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">Expected volatility</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">88.2% - 96.0%</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">98.6%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Expected dividends</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">None</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">None</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The expected volatility was based on the historic volatility. The
expected life of options granted was based on the &quot;simplified method&quot; as described in the SEC's guidance due to changes
in the vesting terms and contractual life of current option grants compared to our historical grants.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The detail of the warrants outstanding and exercisable as of March
31, 2017 is as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="text-align: center; border-bottom: Black 1pt solid">Warrants Outstanding</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="text-align: center; border-bottom: Black 1pt solid">Warrants Exercisable</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: center; border-bottom: Black 1pt solid">Range of <BR> Exercise Prices</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Number <BR>Outstanding</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Weighted<BR>
    Average <BR>Remaining <BR>Life (Years)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Weighted <BR>
    Average <BR>Exercise Price</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Number <BR>Outstanding</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Weighted <BR>
    Average <BR>Exercise Price</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 15%; text-align: center">$5.00 or Below</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 13%; text-align: right">1,860,101</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 13%; text-align: right">3.78</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">3.67</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 13%; text-align: right">1,860,101</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">3.67</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: center">$5.20 - $9.00</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">711,067</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2.77</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">6.47</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">705,067</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">6.47</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: center; padding-bottom: 1pt">$9.65 - $15.00</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">32,928</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: right">2.37</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left">$</TD><TD STYLE="padding-bottom: 1pt; text-align: right">12.32</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">32,928</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left">$</TD><TD STYLE="padding-bottom: 1pt; text-align: right">12.32</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">2,604,096</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">2,604,096</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">STOCK-BASED COMPENSATION:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">2000 STOCK OPTION PLAN</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Our 2000 Stock Option Plan provides for the grant of incentive
stock options to our full-time employees (who may also be directors) and nonstatutory stock options to non-employee directors,
consultants, customers, vendors or providers of significant services. The exercise price of any incentive stock option may not
be less than the fair market value of the common stock on the date of grant or, in the case of an optionee who owns more than
10% of the total combined voting power of all classes of our outstanding stock, not be less than 110% of the fair market value
on the date of grant. The exercise price, in the case of any nonstatutory stock option, must not be less than 75% of the fair
market value of the common stock on the date of grant. The amount reserved under the 2000 Stock Option Plan is 10,000 options.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">At March 31, 2016, all of the grants previously made under the
2000 Stock Option Plan had expired and 200 unregistered shares had been issued under the plan, with 9,800 available for future
issuance.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">2010 STOCK INCENTIVE PLAN</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In August 2010, we adopted the 2010 Stock Incentive Plan, which
provides incentives to attract, retain and motivate employees and directors whose present and potential contributions are important
to our success by offering them an opportunity to participate in our future performance through awards of options, the right to
purchase common stock, stock bonuses and stock appreciation rights and other awards. A total of 70,000 common shares were initially
reserved for issuance under the 2010 Stock Incentive Plan.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In August 2010, we filed a registration statement on Form S-8 for
the purpose of registering 70,000 common shares issuable under this plan under the Securities Act, and in July 2012, we filed
a registration statement on Form S-8 for the purpose of registering 100,000 common shares issuable under this plan under the Securities
Act.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">On January 26, 2016, our Board of Directors approved an amendment
to the 2010 Stock Incentive Plan to increase the total number of shares of common stock reserved for issuance under the plan to
3,170,000 shares, subject to amendment of our Articles of Incorporation to increase our authorized common stock. On March 29,
2016, we held an annual stockholders meeting, at which our stockholders approved the Amended 2010 Stock Incentive Plan and an
amendment of our Articles of Incorporation to increase our authorized common stock to 30,000,000 shares.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">At March 31, 2017, we had 2,241,549 shares available under this
plan.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">2012 DIRECTORS COMPENSATION PROGRAM</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In July 2012, our Board of Directors approved a board compensation
program that modifies and supersedes the 2005 Directors Compensation Program, which was previously in effect. Under the 2012 program,
in which only non-employee directors may participate, an eligible director will receive a grant of $35,000 worth of ten-year options
to acquire shares of common stock, with such grant being valued at the exercise price based on the average of the closing bid
prices of the common stock for the five trading days preceding the first day of the fiscal year. In addition, under this program,
eligible directors will receive cash compensation equal to $500 for each committee meeting attended and $1,000 for each formal
board meeting attended.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">At March 31, 2017, we had issued 26,757 options under the 2005
program to outside directors and 79,309 options to employee-directors, 21,756 outside directors&rsquo; options had been forfeited,
5,000 outside directors&rsquo; options had been exercised, 79,309 employee-directors&rsquo; options had been forfeited and no
options under the 2005 program remained outstanding.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">On June 6, 2014, our Board of Directors approved certain changes
to the 2012 program. Under this modified program, a new eligible director will receive an initial grant of $50,000 worth of options
to acquire shares of common stock, with such grant being valued at the exercise price based on the average of the closing bid
prices of the common stock for the five trading days preceding the first day of the fiscal year. These options will have a term
of ten years and will vest 1/3 upon grant and 1/3 upon each of the first two anniversaries of the date of grant. In addition,
at the beginning of each fiscal year, each existing director eligible to participate in the modified 2012 program also will receive
a grant of $35,000 worth of options valued at the exercise price based on the average of the closing bid prices of the common
stock for the five trading days preceding the first day of the fiscal year. Such options will vest on the first anniversary of
the date of grant. In lieu of per meeting fees, eligible directors will receive an annual board retainer fee of $30,000. The modified
2012 program also provides for the following annual retainer fees: Audit Committee Chair - $5,000, Compensation Committee chair
- $5,000, Audit Committee member - $4,000, Compensation Committee member - $4,000 and lead independent director - $15,000.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">RESTRICTED STOCK UNIT GRANTS TO DIRECTORS AND EXECUTIVE OFFICERS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">On August 9, 2016, our Board of Directors (the &ldquo;Board&rdquo;)
granted RSUs to certain of our officers and directors as set forth below. The RSUs represent the right to be issued on a future
date shares of our common stock for vested RSUs. Our Compensation Committee recommended the grants based on a compensation assessment
provided by a third-party compensation consulting firm engaged by us that developed a peer group of companies for market assessment
and analyzed compensation at such companies.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The consultant recommended beneficial ownership targets, which
we previously disclosed in our Proxy Statement filed on February 23, 2016, in connection with our Annual Meeting of Stockholders
held on March 29, 2016. In connection with the Annual Meeting, our stockholders approved our Amended 2010 Stock Incentive Plan,
which included an increase in the number of shares available for grant under the plan in part to accommodate equity awards recommended
by the Compensation Committee, and our stockholders approved our executive compensation as disclosed in the Proxy Statement pursuant
to Item 402 paragraphs (m) through (q) of Regulation S-K as shown below:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">To Mr. James A. Joyce, an aggregate of 634,000 RSUs valued at $6.28
per share, based on the August 9, 2016 closing price of the common stock. 158,500 of the RSUs are deemed vested upon grant and
an additional 39,625 RSUs will vest each quarter beginning on January 1, 2017. This grant is intended to increase Mr. Joyce&rsquo;s
beneficial ownership of our common stock to 9.0%, which target was recommended in 2015 and in June 2016 by the compensation consultant
engaged by us. Previously, in 2004, the Board had approved a beneficial ownership target of 15% for Mr. Joyce. However, Mr. Joyce
has agreed to the modified target of 9.0%.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">To Mr. Rodney S. Kenley, an aggregate of 52,000 RSUs valued at
$6.28 per share, based on the August 9, 2016 closing price of the common stock. 13,000 of the RSUs are deemed vested upon grant
and an additional 3,250 RSUs will vest each quarter beginning on January 1, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">To Mr. James B. Frakes, an aggregate of 52,000 RSUs valued at $6.28
per share, based on the August 9, 2016 closing price of the common stock. 13,000 of the RSUs are deemed vested upon grant and
an additional 3,250 RSUs will vest each quarter beginning on January 1, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">To each of our non-employee directors, Mr. Franklyn S. Barry, Jr.,
Mr. Edward G. Broenniman and Dr. Chetan S. Shah, 16,432 RSUs valued at an aggregate of $105,000, based on the average of the closing
prices of the common stock for the five trading days preceding and including August 9, 2016. These grants represent (a) $70,000
worth of RSUs representing two years of grants under the amended 2012 Non-Employee Directors Compensation Program (the &ldquo;2012
Program&rdquo;) because more than two years have elapsed since Messrs. Barry and Broenniman and Dr. Shah received grants under
the program, all of which RSUs are deemed vested upon grant and (b) $35,000 worth of RSUs representing the grant covering the
fiscal year ending March 31, 2017, of which one-quarter were deemed vested upon grant and the remaining portion vested ratably
at September 30, 2016, at December 31, 2016 and at March 31, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The RSUs were granted under our Amended 2010 Stock Incentive Plan
and we recorded expense of $2,076,535 in the fiscal year ended March 31, 2017 related to the RSU grants.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">CHANGES TO 2012 NON-EMPLOYEE DIRECTORS COMPENSATION PROGRAM</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In July 2012, the Board approved the 2012 Program, which modified
and superseded the 2005 Directors Compensation Program that had been in effect previously. On June 6, 2014, the Board approved
certain changes to the 2012 Program, and on August 9, 2016, the Board approved further modifications to the program. Under the
modified 2012 Program, in which only non-employee directors may participate, a new eligible director will receive an initial grant
of $50,000 worth of RSUs or, at the discretion of the Board, options to acquire shares of Common Stock. RSUs granted under this
provision will be valued based on the average of the closing prices of the Common Stock for the five trading days preceding and
including the date of grant and will vest at a rate determined by the Board in its discretion. Options granted under this provision
will be valued at the exercise price, which will be based on the average of the closing prices of the Common Stock for the five
trading days preceding and including the date of grant. Such options will have a term of ten years and will vest at a rate determined
by the Board in its discretion.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">At the beginning of each fiscal year, each existing director eligible
to participate in the 2012 Program will receive a grant of $35,000 worth of RSUs or, at the discretion of the Board, options to
acquire shares of Common Stock. RSUs granted under this provision will be valued based on the average of the closing prices of
the Common Stock for the five trading days preceding and including the first day of the fiscal year (or preceding and including
the date of grant, if such grant is not made on the first day of the fiscal year) and will vest at a rate determined by the Board
in its discretion. Options granted under this provision will be valued at the exercise price, which will be based on the average
of the closing prices of the Common Stock for the five trading days preceding and including the first day of the fiscal year (or
preceding and including the date of grant, if such grant is not made on the first day of the fiscal year). Such options will have
a term of ten years and will vest at a rate determined by the Board in its discretion.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In lieu of per meeting fees, under the 2012 Program eligible directors
will receive an annual Board retainer fee of $30,000. The modified 2012 Program also provides for the following annual retainer
fees: Audit Committee Chair - $5,000, Compensation Committee chair - $5,000, Nominating Committee Chair - $5,000, Audit Committee
member - $4,000, Compensation Committee member - $4,000 and Lead independent director (currently an open position) - $15,000.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The RSU grants and the changes to the 2012 Program were approved
and recommended by our Compensation Committee prior to approval by the Board.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">RSUs outstanding that have vested and are expected to vest as of
March 31, 2017 are as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 60%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid; text-align: center">Number of RSUs</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 43%">Vested</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 13%; text-align: right">46,125</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Expected to vest</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">507,375</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-bottom: 2.5pt">Total</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">553,500</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">During the fiscal year ended March 31, 2017, 36,150 RSUs held by
our outside directors were exchanged into the same number of shares of our common stock. As two of our three outside directors
elected to return 40% of their RSU&rsquo;s in exchange for cash in order to pay their withholding taxes on the share issuances,
13,146 of the RSUs were cancelled and we paid a total of $75,550 in cash to those two outside directors.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Also during the fiscal year ended March 31, 2017, 184,500 RSUs
held by our executives were exchanged into the same number of shares of our common stock. Upon vesting, the RSUs held by our executives
were net share-settled to cover the required withholding tax and the remaining amount is converted into an equivalent number of
shares of common stock. Total payments for the employees&rsquo; tax obligations to the taxing authorities are reflected as a financing
activity within the Consolidated Statements of Cash Flows. These net-share settlements had the effect of share repurchases by
the Company as they reduced and retired the number of shares that would have otherwise been issued as a result of the vesting
and did not represent an expense to the Company. As a result of the net share-settlements, 70,786 of the RSUs were cancelled and
we issued a net 113,714 shares to our executives.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">STAND-ALONE GRANTS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">From time to time our Board of Directors grants common stock or
common share purchase options or warrants to selected directors, officers, employees and consultants as equity compensation to
such persons on a stand-alone basis outside of any of our formal stock plans. The terms of these grants are individually negotiated.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">STOCK OPTION ACTIVITY</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">There were no stock option grants during the fiscal years ended
March 31, 2017 and March 31, 2016. There was no stock option activity during the fiscal year ended March 31, 2017 other than the
expiration of 6,500 stock options during the period.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The following is a summary of the stock options outstanding at
March 31, 2017 and 2016 and the changes during the years then ended:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: center; padding-bottom: 1pt"></TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="14" STYLE="text-align: center; border-bottom: Black 1pt solid">Fiscal Year Ended March 31,</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="text-align: center; border-bottom: Black 1pt solid">2017</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD COLSPAN="7" STYLE="border-bottom: Black 1pt solid; text-align: center">2016</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: center; padding-bottom: 1pt"></TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Options</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Weighted <BR>
    Average <BR>Exercise Price</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Options</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid; text-align: center">Weighted<BR>
    Average <BR>Exercise Price</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 40%; text-align: left">Outstanding, beginning of year</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; text-align: right">438,547</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 11%; text-align: right">10.94</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; text-align: right">501,690</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 11%; text-align: right">11.00</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>Granted</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">N/A
                                         </FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">N/A</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>Exercised</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">N/A
                                         </FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">N/A</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1pt">Cancelled/Forfeited</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(6,500</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">7.96</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(63,143</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">11.45</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Outstanding, end of year</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">432,047</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">10.98</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">438,547</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">10.94</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Exercisable, end of year</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">414,547</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">11.24</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">388,414</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">11.53</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-bottom: 2.5pt; padding-left: 10pt; text-indent: -10pt">Weighted average estimated fair value of options
    granted</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">N/A</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: right"></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">N/A</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The detail of the options outstanding and exercisable as of March
31, 2017 is as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="10" STYLE="text-align: center; border-bottom: Black 1pt solid">Options Outstanding</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="text-align: center; border-bottom: Black 1pt solid">Options Exercisable</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: center; border-bottom: Black 1pt solid">Exercise Prices</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Number <BR>Outstanding</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Weighted <BR>
    Average <BR>Remaining <BR>Life (Years)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Weighted <BR>
    Average <BR>Exercise <BR>Price</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Number <BR>Outstanding</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Weighted <BR>
    Average <BR>Exercise <BR>Price</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 15%; text-align: center">$3.80 - $9.50</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 13%; text-align: right">184,047</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 13%; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">6.70
                                         years</FONT></TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">6.82</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 13%; text-align: right">166,547</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">6.86</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: center">$12.50</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">163,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">3.39
                                         years</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">12.50</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">163,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">12.50</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: center; padding-bottom: 1pt">$18.00 - $20.50</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">85,000</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">1.02
                                         years</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left">$</TD><TD STYLE="padding-bottom: 1pt; text-align: right">19.03</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">85,000</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left">$</TD><TD STYLE="padding-bottom: 1pt; text-align: right">19.03</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: right; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">432,047</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">414,547</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">We recorded stock-based compensation expense related to share issuances
and to options granted totaling $2,186,309 and $202,844 for the fiscal years ended March 31, 2017 and 2016, respectively. These
expenses were recorded as stock compensation included in payroll and related expenses in the accompanying consolidated statement
of operations for the years ended March 31, 2017 and 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Our total stock-based compensation for fiscal years ended March
31, 2017 and 2016 included the following:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="text-align: center; border-bottom: Black 1pt solid">Fiscal Year Ended</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">March 31, 2017</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">March 31, 2016</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 66%; text-align: left; padding-bottom: 1pt">Vesting of stock options</TD><TD STYLE="width: 2%; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="width: 13%; border-bottom: Black 1pt solid; text-align: right">2,186,309</TD><TD STYLE="width: 1%; padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="width: 13%; border-bottom: Black 1pt solid; text-align: right">202,844</TD><TD STYLE="width: 1%; padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Total Stock-Based Compensation</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">2,186,309</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">202,844</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">We review share-based compensation on a quarterly basis for changes
to the estimate of expected award forfeitures based on actual forfeiture experience. The cumulative effect of adjusting the forfeiture
rate for all expense amortization is recognized in the period the forfeiture estimate is changed. The effect of forfeiture adjustments
for the fiscal year ended March 31, 2017 was insignificant.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">As of March 31, 2017, we had $3,203,208 of remaining unrecognized
stock-based compensation expense, which is expected to be recognized over a weighted average remaining vesting period of 2.62
years.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">On March 31, 2017, our stock options had a negative intrinsic value
since the closing price on that date of $3.27 per share was below the weighted average exercise price of our stock options.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">6. RELATED PARTY TRANSACTIONS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">DUE TO RELATED PARTIES</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Historically, certain of our officers and other related parties
have advanced us funds, agreed to defer compensation and/or paid expenses on our behalf to cover working capital deficiencies.
There were no such related party transactions during the fiscal year ended March 31, 2017 except that we had accrued unpaid Board
fees of $28,250 owed to our outside directors as of March 31, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">7. OTHER CURRENT LIABILITIES</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Other current liabilities were comprised of the following items:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">March 31, 2017</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">March 31, 2016</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 66%; text-align: left">Accrued interest</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">5,391</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">74,038</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Other accrued liabilities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">64,076</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">62,657</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Total other current liabilities</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">69,467</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">136,695</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">8. INCOME TAXES</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">For the years ended March 31, 2017 and 2016, we had no income tax
expense due to our net operating losses and 100% deferred tax asset valuation allowance.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">At March 31, 2017 and 2016, we had net deferred tax assets as detailed
below. These deferred tax assets are primarily composed of capitalized research and development costs and tax net operating loss
carryforwards. Due to uncertainties surrounding our ability to generate future taxable income to realize these assets, a 100%
valuation has been established to offset the net deferred tax assets.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Significant components of our net deferred tax assets at March
31, 2017 and 2016 are shown below:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="text-align: center; border-bottom: Black 1pt solid">YEAR ENDED MARCH 31,</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">2017</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">2016</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">Deferred tax assets:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 66%; text-align: left">Capitalized research and development</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">3,442,000</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">3,442,000</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">Net operating loss carryforwards</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">22,060,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">20,126,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Stock compensation</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">318,000</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">Total deferred tax assets</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">25,820,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">23,568,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Total deferred tax liabilities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">Net deferred tax assets</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">25,820,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">23,568,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Valuation allowance for deferred tax assets</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(25,820,000</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(23,568,000</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Net deferred tax assets</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">At March 31, 2017, we had tax net operating loss carryforwards
for federal and state purposes approximating $57 million and $45 million, which begin to expire in the year 2023.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The provision for income taxes on earnings subject to income taxes
differs from the statutory federal rate for the years ended March 31, 2017 and 2016 due to the following:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">2017</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">2016</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 66%; text-align: left; text-indent: -10pt; padding-left: 10pt">Income taxes (benefit) at federal statutory
    rate of 34%</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">(2,484,000</TD><TD STYLE="width: 1%; text-align: left">)</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">(1,686,000</TD><TD STYLE="width: 1%; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">State income tax, net of federal benefit</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(438,000</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(298,000</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Tax effect on non-deductible expenses and credits</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">382,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">69,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Change
    in valuation allowance<SUP>1</SUP></FONT></TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">2,540,000</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">1,915,000</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">______________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 3pt 0 0"><SUP>(1)</SUP> Pursuant to Internal Revenue Code Sections
382, use of our tax net operating loss carryforwards may be limited.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">ASC 740, &ldquo;Income Taxes&rdquo;, clarifies the accounting for
uncertainty in income taxes recognized in an entity's financial statements, and prescribes recognition thresholds and measurement
attributes for financial statement disclosure of tax positions taken or expected to be taken on a tax return. Under ASC 740, the
impact of an uncertain income tax position on the income tax return must be recognized at the largest amount that is more-likely-than-not
to be sustained upon audit by the relevant taxing authority. An uncertain income tax position will not be recognized if it has
less than a 50% likelihood of being sustained. Additionally, ASC 740 provides guidance on derecognition, classification, interest
and penalties, accounting in interim periods, disclosure and transition. Our practice is to recognize interest and/or penalties
related to income tax matters in income tax expense. During the years ended March 31, 2017 and 2016, we did not recognize any
interest or penalties relating to tax matters.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">At and for the years ended March 31, 2017 and 2016, management
does not believe the Company has any uncertain tax positions. Accordingly, there are no unrecognized tax benefits at&nbsp;March
31, 2017 or March 31, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Our tax returns remain open for examination by the applicable authorities,
generally 3 years for federal and 4 years for state. We are currently not under examination by any taxing authorities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">9. DARPA CONTRACT AND RELATED REVENUE RECOGNITION</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">As discussed in Note 1, we entered into a contract with DARPA on
September 30, 2011. Under the DARPA award, we have been engaged to develop a therapeutic device to reduce the incidence of sepsis,
a fatal bloodstream infection that often results in the death of combat-injured soldiers. The award from DARPA was a fixed-price
contract with potential total payments to us of $6,794,389 over the course of five years. Fixed price contracts require the achievement
of multiple, incremental milestones to receive the full award during each year of the contract. Under the terms of the contract,
we performed certain incremental work towards the achievement of specific milestones against which we invoiced the government
for fixed payment amounts.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Originally, only the base year (year one of the contract) was effective
for the parties; however, DARPA subsequently exercised its option on the remaining years of the contract. The milestones were
comprised of planning, engineering and clinical targets, the achievement of which in some cases required the participation and
contribution of third-party participants under the contract. We commenced work under the contract in October 2011 and completed
the contract in September 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In February 2014, DARPA reduced the scope of our contract in years
three through five of the contract. The reduction in scope focused our research on exosomes, viruses and blood processing instrumentation.
This scope reduction reduced the possible payments under the contract by $858,469 over years three through five.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In the fiscal year ended March 31, 2017, we invoiced the U.S. Government
for the final two milestones under our DARPA contract in the aggregate amount of $387,438. In the fiscal year ended March 31,
2016, we invoiced the U.S. Government for four milestones under our DARPA contract in the amount of $863,011.&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><I>Fiscal Year Ended March 31, 2017</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In the fiscal year ended March 31, 2017, we invoiced the U.S. Government
for the final two milestones under our DARPA contract in the aggregate amount of $387,438.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The details of those milestones were as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Milestone 2.6.1.3 - Quantify the degree to which the MERS virus
can be extracted from circulation in vitro using miniature Hemopurifiers. The milestone payment was $193,719. Management considers
this milestone to be substantive as it was not dependent on the passage of time nor was it based solely on another party's efforts.
We quantified the degree to which the MERS virus can be extracted from circulation in vitro using miniature Hemopurifiers. The
report was accepted by the contracting officer's representative and the invoice was submitted thereafter.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Milestone 2.6.1.4 &ndash; Prepare and present Final Report for
DARPA. The milestone payment was $193,719. Management considers this milestone to be substantive as it was not dependent on the
passage of time nor was it based solely on another party's efforts. We prepared and presented the Final Report for DARPA. The
report was accepted by the contracting officer's representative and the invoice was submitted thereafter.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><I>Fiscal Year Ended March 31, 2016</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><I>&nbsp;</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">During the fiscal year ended March 31, 2016, we invoiced the Defense
Advanced Research Projects Agency for four milestones totaling $863,011. The details of those milestones were as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Milestone M6 &ndash; Define Aethlon&rsquo;s GMP manufacturing process
and revise and upgrade Aethlon&rsquo;s quality procedures and policies to the current state of the art. The milestone payment
was $186,164. Management considers this milestone to be substantive as it was not dependent on the passage of time nor was it
based solely on another party's efforts. We demonstrated that defined our GMP manufacturing process and that we revised and upgraded
our quality procedures and policies to the current state of the art for a company of our size. The report was accepted by the
contracting officer's representative and the invoice was submitted thereafter.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Milestone 2.5.1.1 - Complete Aethlon&rsquo;s GMP procedure and
establish and maintain all GMP documentation for the company. The milestone payment was $186,164. Management considers this milestone
to be substantive as it was not dependent on the passage of time nor was it based solely on another party's efforts. We demonstrated
that we completed our GMP procedures and established and maintained all GMP documentation for the company. The report was accepted
by the contracting officer's representative and the invoice was submitted thereafter.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Milestone 2.5.2.2 &ndash; Finish construction and begin delivery
of 50 prototype cartridges for testing by the systems integrator. The milestone payment was $296,964. Management considers this
milestone to be substantive as it was not dependent on the passage of time nor was it based solely on another party's efforts.
We demonstrated that we completed the construction of 50 prototype cartridges and were prepared to deliver the cartridges to the
systems integrator. The report was accepted by the contracting officer's representative and the invoice was submitted thereafter.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Milestone 2.6.1.1 &ndash; System integrator acceptance of the hemofilter
device. The milestone payment was $193,719. Management considers this milestone to be substantive as it was not dependent on the
passage of time nor was it based solely on another party's efforts. We demonstrated that we completed this milestone by confirmation
by the systems integrator that it was accepting the hemofilter device as part of their overall system.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">10. SEGMENTS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">We operate our businesses principally through two reportable segments:
Aethlon, which represents our therapeutic business activities, and ESI, which represents our diagnostic business activities. Our
reportable segments have been determined based on the nature of the potential products being developed. We record discrete financial
information for ESI and our chief operating decision maker reviews ESI&rsquo;s operating results in order to make decisions about
resources to be allocated to the ESI segment and to assess its performance.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Aethlon&rsquo;s revenue is generated primarily from government
contracts to date and ESI does not yet have any revenues. We have not included any allocation of corporate overhead to the ESI
segment.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The following tables set forth certain information regarding our
segments:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="text-align: center; border-bottom: Black 1pt solid">Fiscal Years Ended March 31,</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">2017</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">2016</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>Revenues:</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 66%; padding-left: 10pt">Aethlon</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">392,073</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">886,572</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1pt; padding-left: 10pt">ESI</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 20pt">Total Revenues</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">392,073</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">886,572</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">Operating Losses:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 10pt">Aethlon</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">(5,945,293</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">(3,953,402</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-bottom: 1pt; padding-left: 10pt">ESI</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(153,064</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(431,432</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 20pt">Total Operating Loss</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(6,098,357</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(4,384,834</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Net Losses:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-left: 10pt">Aethlon</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">(7,153,662</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">(4,527,184</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1pt; padding-left: 10pt">ESI</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(153,064</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(431,432</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 20pt">Net Loss Before Non-Controlling Interests</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(7,306,726</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(4,958,616</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>Cash:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 10pt">Aethlon</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">1,558,667</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">2,114,285</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-bottom: 1pt; padding-left: 10pt">ESI</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">1,034</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">9,452</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 20pt">Total Cash</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">1,559,701</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">2,123,737</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Total Assets:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-left: 10pt">Aethlon</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">1,698,249</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">2,475,686</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1pt; padding-left: 10pt">ESI</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">28,119</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">53,430</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 20pt">Total Assets</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">1,726,368</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">2,529,116</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">Capital Expenditures:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 10pt">Aethlon</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">16,433</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">9,307</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-bottom: 1pt; padding-left: 10pt">ESI</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 20pt">Capital Expenditures</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">16,433</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">9,307</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Depreciation and Amortization:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-left: 10pt">Aethlon</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">22,370</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">18,943</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1pt; padding-left: 10pt">ESI</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">10,043</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">19,581</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 20pt">Total Depreciation and Amortization</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">32,413</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">38,524</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">Interest Expense:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 10pt">Aethlon</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">304,330</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">573,782</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-bottom: 1pt; padding-left: 10pt">ESI</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 20pt">Total Interest Expense</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">304,330</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">573,782</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">11. SUBSEQUENT EVENTS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Management has evaluated events subsequent to March 31, 2017 through
the date that the accompanying consolidated financial statements were filed with the Securities and Exchange Commission for transactions
and other events which may require adjustment of and/or disclosure in such financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In April 2017, we agreed with two individual investors to exchange
11,497 restricted shares for the cancellation of 22,993 warrants.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In April 2017, we issued 15,000 shares of restricted common stock
at a price of $2.24 per share in payment for digital communications consulting services valued at $33,600 based on the value of
the services provided.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In April 2014, we terminated a previously recorded but unissued
share issuance of 68,000 shares under a fully vested restricted stock grant to our CEO and issued to him 32,674 shares as a net
settlement of shares and the Company paid the withholding taxes associated with that share issuance in return for the cancellation
of 35,326 shares. The compensation cost of that restricted stock grant had been fully recorded over prior fiscal years, therefore
no expense was recorded regarding this net issuance.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In April 2017, 46,125 RSUs held by our executives were exchanged
into the same number of shares of our common stock. As our executives elected to net settle a portion of their RSU&rsquo;s in
exchange for the Company paying the related withholding taxes on the share issuance, 23,655 of the RSUs were cancelled and we
issued a net 22,470 shares to our executives.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In the period since March 31, 2017, sold 1,000 shares of common
stock under our Common Stock Sales Agreement with H.C. Wainwright. We raised aggregate net proceeds of $1,903 (net of $63 in commissions
to H.C. Wainwright and $133 in other offering expenses) under this agreement at an average price of $1.90 per share of net proceeds.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In June 2017, we issued options to four of our employees to purchase
34,500 shares of common stock at a price of $1.68 per share, the closing price on the date of the approval of the option grants
by our compensation committee.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In June 2017, we entered into an Exchange Agreement with two institutional
investors under which we issued 57,844 restricted shares in exchange for the cancellation of 77,125 warrants held by those investors.
Additionally, we agreed with those investors that they would extend the expiration dates of convertible notes held by those investors
from July 1, 2018 to July 1, 2019 in exchange for the reduction of the conversion price of those notes from $4.00 per share to
$3.00 per share.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">12. COMMITMENTS AND CONTINGENCIES</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">EMPLOYMENT CONTRACTS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">We entered into an employment agreement with our Chairman of the
Board (&ldquo;Chairman&rdquo;) effective April 1, 1999. The agreement, which is cancelable by either party upon sixty days&rsquo;
notice, will be in effect until the Chairman retires or ceases to be employed by us. Under the terms of the agreement, if the
Chairman is terminated he may become eligible to receive a salary continuation payment in the amount of at least twelve months'
base salary, which was increased to $385,000 per year in September 2015.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">We entered into an employment agreement with Dr. Richard H. Tullis,
Ph. D. (&ldquo;Tullis&rdquo;) effective January 10, 2000 as our Chief Science Officer (&quot;CSO&quot;). Under the terms of the
agreement, if Tullis is terminated he may become eligible to receive a salary continuation payment in the amount of twelve months&rsquo;
base salary, which is $195,000 per year.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In February 2016, we entered into a part-time consulting agreement
with Tullis. Under that agreement, Tullis continued to provide services under the terms of a consulting agreement with us. In
connection with the change in his employment, Tullis resigned as our Vice President. Under the consulting agreement, Tullis rendered
approximately twenty (20) hours per week of such services, for which we paid him a consulting fee of $10,000 per month. The term
of the consulting agreement was for an initial sixty-day period and, unless terminated earlier by either party, shall automatically
extend for additional one-month periods. Either party to the consulting agreement may terminate it upon 30 day&rsquo;s prior written
notice to the other party.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Concurrently with the entry into the consulting agreement, Tullis
and the Company mutually agreed to terminate his employment agreement with us.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In November 2016, the scope of the consulting agreement was amended
to reduce the hours from 20 hours per week to 20 hours per month with a reduction in monthly consulting fees from the original
$10,000 per month to $4,000 per month.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Then in February 2017, the scope of the consulting agreement was
further amended to reduce the hours from 20 hours per month to 10 hours per month with a reduction in monthly consulting fees
from $4,000 per month to $2,000 per month.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">RETENTION AGREEMENTS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">On October 16, 2015, following a recommendation of our Compensation
Committee, we approved retention bonus grants to three of our executive officers under a newly established Aethlon Senior Management
Retention Program to maintain management stability going forward. The Board approved a $100,000 retention bonus for Mr. James
A. Joyce, our Chief Executive Officer, a $50,000 retention bonus for Mr. Rodney S. Kenley, our President, and a $50,000 retention
bonus for Mr. James B. Frakes, our Chief Financial Officer.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In connection with the bonus granted to Mr. Joyce, we entered into
an amendment of Mr. Joyce&rsquo;s Employment Agreement dated April 1, 1999. Pursuant to the amendment, if within two years of
the effective date of the amendment, we terminate Mr. Joyce&rsquo;s employment with us for &ldquo;Cause&rdquo; (as defined in
his employment agreement) or Mr. Joyce terminates his employment with us other than for &ldquo;Good Reason&rdquo; (as defined
in his employment agreement), Mr. Joyce must repay in full the amount of the bonus received from us. In the event of his death
or disability or termination by us other than for &ldquo;Cause&rdquo; or termination by Mr. Joyce for &ldquo;Good Reason,&rdquo;
Mr. Joyce will not be required to repay any portion of the bonus received by him.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In connection with the bonus granted to Mr. Kenley, we entered
into an amendment of Mr. Kenley&rsquo;s Offer Letter dated October 27, 2010. Pursuant to the amendment, if within two years of
the effective date of the amendment, we terminate Mr. Kenley&rsquo;s employment with us for &ldquo;Cause&rdquo; (as defined in
the amendment) or Mr. Kenley terminates his employment with us other than for &ldquo;Good Reason&rdquo; (as defined in the amendment),
Mr. Kenley must repay in full the amount of the bonus received from us. In the event of his death or disability or termination
by us other than for &ldquo;Cause&rdquo; or termination by Mr. Kenley for &ldquo;Good Reason,&rdquo; Mr. Kenley will not be required
to repay any portion of the bonus received by him.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In connection with the bonus granted to Mr. Frakes, we entered
into a Retention Bonus Agreement with Mr. Frakes. Pursuant to the agreement, if within two years of the effective date of the
agreement, we terminate Mr. Frakes&rsquo; employment with us for &ldquo;Cause&rdquo; (as defined in the agreement) or Mr. Frakes
terminates his employment with us other than for &ldquo;Good Reason&rdquo; (as defined in the agreement), Mr. Frakes must repay
in full the amount of the bonus received from us. In the event of his death or disability or termination by us other than for
&ldquo;Cause&rdquo; or termination by Mr. Frakes for &ldquo;Good Reason,&rdquo; Mr. Frakes will not be required to repay any portion
of the bonus received by him.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">LEASE COMMITMENTS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">We currently rent approximately 2,600 square feet of executive
office space at 9635 Granite Ridge Drive, Suite 100, San Diego, CA 92123 at the rate of $6,054 per month on a four-year lease
that expires in January 2019. We also rent approximately 1,700 square feet of laboratory space at 11585 Sorrento Valley Road,
Suite 109, San Diego, California 92121 at the rate of $4,838 per month on a one-year lease that expires in November 2016.&nbsp;&nbsp;Our
current plans are to renew the lease prior to expiration or to secure alternative lab space in the San Diego area.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Our Exosome Sciences, Inc. subsidiary previously rented approximately
2,055 square feet of office and laboratory space at 11 Deer Park Drive, South Brunswick, NJ at the rate of $3,917 per month on
a one-year lease that expired in October 2015. In October 2015, Exosome Sciences, Inc. relocated to a different suite at the same
office complex. That new suite was comprised of approximately 541 square feet of office and laboratory space and is located at
9 Deer Park Drive, South Brunswick, NJ at the rate of $1,352 per month under a month to month lease basis. In January 2016, we
exercised our 30-day notice to terminate the Exosome Sciences&rsquo; lease in New Jersey as part of a consolidation of our laboratory
operations in San Diego.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Rent expense, which is included in general and administrative expenses,
approximated $151,000 and $144,000 for the fiscal years ended March 31, 2017 and 2016, respectively. As of March 31, 2017, our
commitments under the lease agreements are as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="6">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="border-bottom: Black 1pt solid; text-align: center">Fiscal Year Ending</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid; text-align: center">2018</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">2019</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 66%; text-align: left; padding-left: 10pt; text-indent: -10pt">9635 Granite Ridge Drive, Suite 100, San
    Diego, CA 92123 office lease</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">78,156</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">21,446</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 10pt; text-indent: -10pt">11585 Sorrento Valley Road, Suite
    109, San Diego, CA 92121 office lease</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">47,054</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Total Lease Commitments</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">125,210</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">21,446</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">LEGAL MATTERS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">From time to time, claims are made against us in the ordinary course
of business, which could result in litigation. Claims and associated litigation are subject to inherent uncertainties and unfavorable
outcomes could occur, such as monetary damages, fines, penalties or injunctions prohibiting us from selling one or more products
or engaging in other activities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The occurrence of an unfavorable outcome in any specific period
could have a material adverse effect on our results of operations for that period or future periods. We are not presently a party
to any pending or threatened legal proceedings.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">AETHLON MEDICAL, INC. AND SUBSIDIARY</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><A NAME="a01"></A>CONDENSED CONSOLIDATED BALANCE
SHEETS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">June 30, <BR> 2017</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">March 31, <BR> 2017</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">(Unaudited)</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>ASSETS</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Current assets</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 66%; padding-left: 10pt">Cash</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">327,206</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">1,559,701</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 10pt">Prepaid expenses and other current assets</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">38,450</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">37,551</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-left: 20pt">Total current assets</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">365,656</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,597,252</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">Property and equipment, net</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">45,893</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">29,223</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Patents and patents pending, net</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">82,705</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">84,996</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-bottom: 1pt">Deposits</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">14,897</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">14,897</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 20pt">Total assets</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">509,151</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">1,726,368</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">LIABILITIES AND STOCKHOLDERS&rsquo; (DEFICIT) EQUITY</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Current liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-left: 10pt">Accounts payable</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">277,094</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">484,423</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 10pt">Due to related parties</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">48,366</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">57,866</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 10pt">Other current liabilities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">82,845</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">69,467</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 20pt">Total current liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">408,305</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">611,756</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Convertible notes payable, net</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">1,050,911</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">519,200</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-indent: 9pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 20pt">Total liabilities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">1,459,216</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">1,130,956</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-indent: 9pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Commitments and Contingencies (Note 13)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">Stockholders&rsquo; (Deficit) Equity</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 20pt; text-indent: -10pt">Common stock, par value $0.001 per share; 30,000,000 shares authorized
    as of June 30, 2017 and March 31, 2017; 8,869,571 and 8,797,086 shares issued and outstanding as of June 30, 2017 and March
    31, 2017, respectively</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8,869</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8,796</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-left: 10pt">Additional paid-in capital</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">94,745,740</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">94,445,739</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 10pt">Accumulated deficit</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(95,619,939</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(93,778,156</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-left: 20pt; text-indent: -10pt">Total Aethlon Medical, Inc. stockholders&rsquo; (deficit)
    equity before noncontrolling interests</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(865,330</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">676,379</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Noncontrolling interests</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(84,735</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(80,967</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Total stockholders&rsquo; (deficit) equity</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(950,065</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">595,412</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Total liabilities and stockholders&rsquo; (deficit) equity</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">509,151</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">1,726,368</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">See accompanying notes.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">AETHLON MEDICAL, INC. AND SUBSIDIARY</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><A NAME="a02"></A>CONDENSED CONSOLIDATED STATEMENTS
OF OPERATIONS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">For the Three Month Periods Ended June 30,
2017 and 2016</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">(Unaudited)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Three Months <BR> Ended <BR> June 30, 2017</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Three Months <BR> Ended <BR> June 30, 2016</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">REVENUES</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 66%; text-align: left; padding-bottom: 1pt; padding-left: 20pt; text-indent: -10pt">Government contract
    revenue</TD><TD STYLE="width: 2%; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="width: 13%; border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="width: 1%; padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="width: 13%; border-bottom: Black 1pt solid; text-align: right">4,635</TD><TD STYLE="width: 1%; padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 30pt; text-indent: -10pt">Total revenues</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,635</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 10pt; text-indent: -10pt">OPERATING EXPENSES</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-left: 20pt; text-indent: -10pt">Professional fees</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">343,023</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">567,749</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 20pt; text-indent: -10pt">Payroll and related expenses</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">630,227</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">344,987</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 20pt; text-indent: -10pt">General and administrative</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">186,999</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">223,551</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 30pt; text-indent: -10pt">Total operating expenses</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">1,160,249</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">1,136,287</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-left: 10pt; text-indent: -10pt">OPERATING LOSS</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(1,160,249</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(1,131,652</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-left: 10pt; text-indent: -10pt">OTHER EXPENSE</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 20pt; text-indent: -10pt">Interest and other debt expenses</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">188,604</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">42,167</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-left: 20pt; text-indent: -10pt">Loss on debt extinguishment</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">376,909</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">616,889</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 20pt; text-indent: -10pt">Loss on share for warrant exchanges</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">119,789</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 20pt; text-indent: -10pt">Warrant repricing expense</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">345,841</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 30pt; text-indent: -10pt">Total other expense</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">685,302</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">1,004,897</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 10pt; text-indent: -10pt">NET LOSS BEFORE NONCONTROLLING INTERESTS</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(1,845,551</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(2,136,549</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 10pt; text-indent: -10pt">LOSS ATTRIBUTABLE TO NONCONTROLLING
    INTERESTS</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(3,769</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(7,732</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 10pt; text-indent: -10pt">NET LOSS ATTRIBUTABLE TO COMMON
    STOCKHOLDERS</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(1,841,782</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(2,128,817</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 10pt; text-indent: -10pt">BASIC AND DILUTED LOSS PER SHARE
    AVAILABLE TO COMMON STOCKHOLDERS</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(0.21</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(0.28</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 10pt; text-indent: -10pt">WEIGHTED AVERAGE NUMBER OF COMMON
    SHARES OUTSTANDING &ndash; BASIC AND DILUTED</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">8,805,522</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">7,622,393</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">See accompanying notes.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">AETHLON MEDICAL, INC. AND SUBSIDIARY</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><A NAME="a03"></A>CONDENSED CONSOLIDATED STATEMENTS
OF CASH FLOWS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">For the Three Months Ended June 30, 2017 and
2016</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">(Unaudited)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Three Months <BR> Ended <BR> June 30, 2017</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Three Months <BR> Ended <BR> June 30, 2016</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Cash flows from operating activities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 66%; text-align: left; text-indent: -10pt; padding-left: 20pt">Net loss</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">(1,845,551</TD><TD STYLE="width: 1%; text-align: left">)</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">(2,136,549</TD><TD STYLE="width: 1%; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 20pt">Adjustments to reconcile net loss to net cash used in
    operating activities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 30pt">Depreciation and amortization</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">9,326</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">10,218</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 30pt">Stock based compensation</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">280,911</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">50,710</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 30pt">Loss on warrant repricing</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">345,841</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 30pt">Common stock issued for services</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">33,600</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 30pt">Loss on share for warrant exchanges</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">119,789</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 30pt">Loss on debt extinguishment</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">376,909</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">616,889</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 30pt">Amortization of debt discount and deferred financing
    costs</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">154,802</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">27,641</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 40pt">Changes in operating assets and liabilities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 40pt">Accounts receivable</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">199,471</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 40pt">Prepaid expenses and other current assets</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(899</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">30,462</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 40pt">Accounts payable and other current liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(193,951</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">144,246</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; text-indent: -10pt; padding-left: 40pt">Due to related parties</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(9,500</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(116,862</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; text-indent: -10pt; padding-left: 10pt">Net cash used in operating activities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(1,074,564</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(827,933</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Cash flows from investing activities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; text-indent: -10pt; padding-left: 20pt">Purchases of property and equipment</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(23,705</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(1,545</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; text-indent: -10pt; padding-left: 10pt">Net cash used in investing activities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(23,705</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(1,545</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Cash flows from financing activities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 20pt">Proceeds from the issuance of common stock, net</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,903</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; text-indent: -10pt; padding-left: 20pt">Cash paid for repurchase of restricted
    stock units</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(136,129</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; text-indent: -10pt; padding-left: 10pt">Net cash used in financing activities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(134,226</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Net decrease in cash</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(1,232,495</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(829,478</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-bottom: 1pt; text-indent: -10pt; padding-left: 10pt">Cash at beginning of period</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">1,559,701</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">2,123,737</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-bottom: 2.5pt; text-indent: -10pt; padding-left: 10pt">Cash at end of period</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">327,206</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">1,294,259</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Supplemental disclosures of non-cash investing and financing
    activities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; text-indent: -10pt; padding-left: 20pt">Debt discount on convertible notes
    payable</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">242,299</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">75,994</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; text-indent: -10pt; padding-left: 20pt">Issuance of shares under vested
    restricted stock units</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">22</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; text-indent: -10pt; padding-left: 20pt">Reclassification of accrued interest
    to convertible notes payable</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">85,031</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">See accompanying notes.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: left">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: left">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">AETHLON MEDICAL, INC. AND SUBSIDIARY</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><A NAME="a04"></A>NOTES TO CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS (UNAUDITED)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">June 30, 2017</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">1. NATURE OF BUSINESS AND BASIS OF PRESENTATION</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">ORGANIZATION</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Aethlon Medical, Inc. and subsidiary (&ldquo;Aethlon&rdquo;, the
&ldquo;Company&rdquo;, &ldquo;we&rdquo; or &ldquo;us&rdquo;) is a medical device company focused on creating innovative devices
that address unmet medical needs in in global health and biodefense.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">We create medical technologies to address unmet needs in global
health and biodefense. The Aethlon Hemopurifier&reg; is a clinical-stage therapeutic device that eliminates life-threatening viruses
from the circulatory system of infected individuals. We believe the Aethlon Hemopurifier&reg; can achieve the broad-spectrum countermeasure
goal set forth by the U.S. Department of Health and Human Services (HHS). The device has been validated to capture Ebola, Zika,
Lassa, MERS-CoV, HIV, Hepatitis C, Cytomegalovirus, Epstein-Barr, Herpes Simplex, Chikungunya, Dengue, West Nile, Smallpox related
viruses, H1N1 Swine Flu, H5N1 Bird Flu, and the reconstructed Spanish flu virus of 1918. At present, the Hemopurifier is being
advanced under an FDA approved clinical study. Aethlon is also the majority owner of Exosome Sciences, Inc., a company focused
on the discovery of exosomal biomarkers to diagnose and monitor life-threatening diseases.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">On June 25, 2013, the United States Food and Drug Administration
(FDA) approved an Investigational Device Exemption (IDE) that allows us to initiate human feasibility studies of the Aethlon Hemopurifier&reg;
in the U.S. We ended the treatment phase of that study after treating eight end-stage renal disease patients who were infected
with the Hepatitis C virus (HCV) to demonstrate the safety of Hemopurifier therapy. Successful completion of this study, including
submission to and acceptance by the FDA of the final study documents and related patient treatment data, will allow us the opportunity
to initiate pivotal studies that are required for market clearance to treat HCV and other disease conditions in the U.S.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Successful outcomes of human trials will also be required by the
regulatory agencies of certain foreign countries where we intend to sell this device. Some of our patents may expire before FDA
approval or approval in a foreign country, if any, is obtained. However, we believe that certain patent applications and/or other
patents issued more recently will help protect the proprietary nature of the Hemopurifier(R) treatment technology.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In October 2013, our subsidiary, Exosome Sciences, Inc. (&ldquo;ESI&rdquo;),
commenced operations with a focus on advancing exosome-based strategies to diagnose and monitor the progression of cancer, infectious
disease and other life-threatening conditions.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Our common stock is quoted on the Nasdaq Capital Market under the
symbol &ldquo;AEMD.&rdquo;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">During the three months ended June 30, 2017, there have been no
changes to our significant accounting policies as described in our Annual Report on Form 10-K for the fiscal year ended March
31, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The accompanying unaudited condensed consolidated financial statements
of the Company have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) for interim financial
information and with the instructions to Form 10-Q and Article 8 of the Securities and Exchange Commission (SEC) Regulation S-X.
Accordingly, they should be read in conjunction with the audited financial statements and notes thereto for the year ended March
31, 2017, included in the Company's Annual Report on Form 10-K filed with the SEC on June 28, 2017. The accompanying unaudited
condensed consolidated financial statements include the accounts of Aethlon Medical, Inc. and its majority-owned subsidiary. All
significant inter-company transactions and balances have been eliminated in consolidation. The unaudited condensed consolidated
financial statements contain all normal recurring accruals and adjustments that, in the opinion of management, are necessary to
present fairly the condensed consolidated financial statements as of and for the three months ended June 30, 2017, and the condensed
consolidated statement of cash flows for the three months ended June 30, 2017. Estimates were made relating to useful lives of
fixed assets, valuation allowances, the fair value of warrants, impairment of assets, share-based compensation expense and accruals
for clinical trial and research and development expenses. Actual results could differ materially from those estimates. Certain
amounts previously reported in the financial statements have been reclassified to conform to the current presentation. Such reclassifications
did not affect net loss, equity or cash flows. The accompanying condensed consolidated balance sheet at March 31, 2017 has been
derived from the audited consolidated balance sheet at March 31, 2017, contained in the above referenced 10-K. The results of
operations for the three months ended June 30, 2017 are not necessarily indicative of the results to be expected for the full
year or any future interim periods.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">On March 31, 2016, we filed a Certificate of Amendment to our Articles
of Incorporation to increase our authorized common stock from 10,000,000 to 30,000,000 shares. Our stockholders approved the amendment
at our annual meeting of stockholders held on March 29, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">LIQUIDITY AND GOING CONCERN</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Management does not expect existing cash as of June 30, 2017 to
be sufficient to fund the Company&rsquo;s operations for at least twelve months from the issuance date of these interim financial
statements. These financial statements have been prepared on a going concern basis which assumes the Company will continue to
realize its assets and discharge its liabilities in the normal course of business. As of June 30, 2017, the Company has incurred
losses totaling approximately $95,620,000 since inception, has not yet generated material revenue from operations, and will require
additional funds to maintain its operations. These factors raise substantial doubt regarding the Company&rsquo;s ability to continue
as a going concern within one year after these consolidated financial statements are issued. The Company&rsquo;s ability to continue
as a going concern is dependent upon its ability to generate future profitable operations and obtain the necessary financing to
meet its obligations and repay its liabilities arising from normal business operations when they become due. The Company intends
to finance operating costs over the next twelve months through its existing financial resources and we may also raise additional
capital through equity offerings, including an equity offering of up to $7.5 million based on a registration statement on Form
S-1 that we filed with the SEC on July 31, 2017, debt financings, collaborations and/or licensing arrangements. If adequate funds
are not available on acceptable terms, we may be required to delay, reduce the scope of, or curtail, our operations. The accompanying
consolidated financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts
and classification of liabilities that might be necessary should the Company be unable to continue as a going concern</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">2. LOSS PER COMMON SHARE</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Basic loss per share is computed by dividing net income available
to common stockholders by the weighted average number of common shares outstanding during the period of computation. The weighted
average number of common shares outstanding for the three months ended June 30, 2017 includes 46,125 vested restricted stock units.
Diluted loss per share is computed similar to basic loss per share except that the denominator is increased to include the number
of additional common shares that would have been outstanding if potential common shares had been issued, if such additional common
shares were dilutive. Since we had net losses for all periods presented, basic and diluted loss per share are the same, and additional
potential common shares have been excluded as their effect would be antidilutive.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">As of June 30, 2017 and 2016, a total of 3,893,303 and 2,771,780
potential common shares, consisting of shares underlying outstanding stock options, warrants, unvested restricted stock units
and convertible notes payable were excluded as their inclusion would be antidilutive.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">3. RESEARCH AND DEVELOPMENT EXPENSES</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Our research and development costs are expensed as incurred. We
incurred research and development expenses during the three month periods ended June 30, 2017 and 2016, which are included in
various operating expense line items in the accompanying condensed consolidated statements of operations. Our research and development
expenses in those periods were as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">June 30,</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">June 30,</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">2017</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">2016</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 66%; padding-bottom: 2.5pt">Three months ended</TD><TD STYLE="width: 2%; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="width: 13%; border-bottom: Black 2.5pt double; text-align: right">157,463</TD><TD STYLE="width: 1%; padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="width: 13%; border-bottom: Black 2.5pt double; text-align: right">117,664</TD><TD STYLE="width: 1%; padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">4. FUTURE ACCOUNTING PRONOUNCEMENTS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Management is evaluating significant recent accounting pronouncements
that are not yet effective for us, including the new accounting standard on improvements to employee share based payment accounting,
ASU 2016-09 (Topic 718), the new accounting standard related to leases, ASU 2016-02 (Topic 842), the new accounting standard for
recognition and measurement of financial assets and financial liabilities, and the new accounting standard on revenue recognition,
ASU 2014-09 (Topic 606), and have not yet concluded whether any such pronouncements will have a significant effect on our future
consolidated financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">5. CONVERTIBLE NOTES PAYABLE, NET</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Convertible Notes Payable, Net consisted of the following at June
30, 2017:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Principal</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Unamortized <BR> Discount</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Net <BR> Amount</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Accrued <BR> Interest</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">Convertible Notes Payable, Net &ndash; Non-Current Portion:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 48%">November 2014 10% Convertible Notes</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">612,811</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">(114,850</TD><TD STYLE="width: 1%; text-align: left">)</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">497,961</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">17,875</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-bottom: 1pt">December 2016 10% Convertible Notes</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">680,400</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(127,450</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">552,950</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">19,846</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Total Convertible Notes Payable, Net</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">1,293,211</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(242,300</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">1,050,911</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">37,721</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">During the three months ended June 30, 2017, we recorded interest
expense of $33,802 related to the contractual interest rates of our convertible notes and interest expense of $154,802 related
to the amortization of the note discount for a total interest expense of $188,604 related to our convertible notes in the three
months ended June 30, 2017. All of the unamortized discount at June 30, 2017 related to the note discount established upon the
June 2017 amendment to the November 2014 10% Convertible Notes and to the December 2016 10% Convertible Notes (see below).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Convertible Notes Payable, Net consisted of the following at March
31, 2017 (our most recent fiscal year end):</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Principal</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Unamortized <BR> Discount</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Net <BR> Amount</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Accrued <BR> Interest</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">Convertible Notes Payable, Net &ndash; Non-Current Portion:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 48%">November 2014 10% Convertible Notes</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">612,811</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">(275,363</TD><TD STYLE="width: 1%; text-align: left">)</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">337,448</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">2,555</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-bottom: 1pt">December 2016 10% Convertible Notes</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">680,400</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(498,648</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">181,752</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">2,836</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Total Convertible Notes Payable, Net</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">1,293,211</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(774,011</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">519,200</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">5,391</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">During the three months ended June 30, 2016, we recorded interest
expense of $13,882 related to the contractual interest rates of our convertible notes and interest expense of $27,641 related
to the amortization of deferred financing costs for a total interest expense of $41,523 related to our convertible notes in the
three months ended June 30, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">NOVEMBER 2014 10% CONVERTIBLE NOTES</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In November 2014, we entered into a subscription agreement with
two accredited investors providing for the issuance and sale of (i) convertible promissory notes in the aggregate principal amount
of $527,780 (the &ldquo;Notes&rdquo;) and (ii) five year warrants to purchase up to 47,125 shares of common stock at a fixed exercise
price of $8.40 per share (the &ldquo;Warrants&rdquo;). These Notes bear interest at the annual rate of 10% and originally matured
on April 1, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The aggregate gross cash proceeds to us were $415,000 after subtracting
legal fees of $35,000, a $27,780 due diligence fee and an original issuance discount of $50,000. We recorded deferred financing
costs of $112,780 to reflect the legal fees, due diligence fee and original issuance discount and will amortize those costs over
the life of the Notes using the effective interest method.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">These Notes are convertible at the option of the holders into shares
of our common stock at a fixed price of $5.60 per share, for up to an aggregate of 94,246 shares of common stock. There are no
registration requirements with respect to the shares of common stock underlying the Notes or the Warrants.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The estimated relative fair value of Warrants issued in connection
with the Notes was recorded as a debt discount and is amortized as additional interest expense over the term of the underlying
debt. We recorded debt discount of $240,133 based on the relative fair value of these Warrants. In addition, as the effective
conversion price of the Notes was less than market price of the underlying common stock on the date of issuance, we recorded an
additional debt discount of $287,647 related to the beneficial conversion feature.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;&nbsp;<B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>Initial Amendment of the November 2014 10% Convertible Note
Terms</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">On November 12, 2015, we entered into an amendment of terms (&ldquo;Amendment
of Terms&rdquo;) with the two investors that participated in the November 2014 10% Convertible Notes. The Amendment of Terms modified
the terms of the subscription agreement, Notes and Warrants held by those investors to, among other things, extended the maturity
date of the Notes from April 1, 2016 to June 1, 2016, temporarily reduced the number of shares that we must reserve with respect
to conversion of the Notes, and temporarily suspended the time period during which one of the investors may exercise its Warrants.
In exchange for the investors&rsquo; agreements in the Amendment of Terms, we paid one of the investors a cash fee of $90,000,
which we recorded as deferred financing costs and amortized over the remaining term of the notes.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>Second Amendment and Extension of the November 2014 10% Convertible
Notes</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">On June 27, 2016, we and certain investors entered into further
Amendments (the &ldquo;Amendments&rdquo;) to the Notes and the Warrants. The Amendments provide that the Maturity Date (as defined
in the Notes) was extended from June 1, 2016 to July 1, 2017 and that the conversion price per share of the Notes was reduced
from $5.60 per share of common stock to $5.00 per share of common stock. In addition, we reduced the purchase price (as defined
in the Warrants) from $8.40 per share to $5.00 per share of common stock. In connection with these modifications, each of the
investors signed a Consent and Waiver providing its consent under certain restrictive provisions, and waiving certain rights,
including a right to participate in certain offerings made by us, under a Securities Purchase Agreement dated June 23, 2015, (the
&ldquo;2015 SPA&rdquo;) to which we, the investors and certain other investors are parties, in order to facilitate an at-the-market
equity program (see Note 6).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The Amendments also increase the principal amount of the Notes
to $692,811 (in the aggregate) to (i)&nbsp;include accrued and unpaid interest through June 15, 2016, and (ii) increase the principal
amount by $80,000 (in the aggregate) as an extension fee for the extended maturity date of the Notes. With respect to each Note,
we entered into an Allonge to Convertible Promissory Note (each, an &ldquo;Allonge&rdquo;) reflecting the changes in the principal
amount, Maturity Date and conversion price of the Note.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">We also issued to the investors new warrants (the &ldquo;New Warrants&rdquo;)
to purchase an aggregate of 30,000 shares of common stock with a Purchase Price (as defined in the New Warrants) of $5.00 per
share of common stock. We issued the New Warrants in substantially the same form as the prior Warrants, and the New Warrants will
expire on November 6, 2019, the same date on which the prior Warrants will expire.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The modification of the Notes was evaluated under FASB Accounting
Standards Codification (&ldquo;ASC&rdquo;) Topic No. 470-50-40, &ldquo;Debt Modification and Extinguishments&rdquo; (&ldquo;ASC
470-50-40&rdquo;). Therefore, according to the guidance, the instruments were determined to be substantially different, and the
transaction qualified for extinguishment accounting. As a result, we recorded a loss on debt extinguishment of $536,889 and recognized
an extension fee expense of $80,000, which are included in other (income) expenses in the accompanying condensed consolidated
statements of operations. The debt extinguishment is comprised from the fair value of prior warrants issued in connection with
the Notes of $287,676, as well as $325,206 related to beneficial conversion feature and offset by debt discount of $75,993. The
beneficial conversion feature is a result of the effective conversion price of the new Notes being less than the market price
of the underlying common stock on the date of modification.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>Third Amendment and Extension of the November 2014 10% Convertible
Notes </B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In connection with the issuance of the December 2016 10% Convertible
Notes, the conversion price of the November 2014 10% Convertible Notes was reduced from $5.00 to $4.00 per share and the expiration
date of the November 2014 10% Convertible Notes was extended from July 1, 2017 to July 1, 2018.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The modification of the Notes was evaluated under ASC 470-50-40
and the instruments were determined to be substantially different, and the transaction qualified for extinguishment accounting.
As a result, we recorded a gain on debt extinguishment of $58,691, which is included in other (income) expenses in the accompanying
condensed consolidated statements of operations. The recording of the modified Notes resulted in a beneficial conversion of $233,748
which is the result of the effective conversion price of the new Notes being less than the market price of the underlying common
stock on the date of modification.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>June 2017 Amendment to the November 2014 10% Convertible Notes</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In June 2017, we agreed with the holders of the November 2014 10%
Convertible Notes to an extension of the expiration dates of the notes from July 1, 2018 to July 1, 2019 in exchange for the reduction
of the conversion price of those notes from $4.00 per share to $3.00 per share. The modification of the Notes was evaluated under
ASC 470-50-40 and the instruments were determined to be substantially different, and the transaction qualified for extinguishment
accounting. Under the extinguishment accounting we recorded a loss on debt extinguishment of $178,655 and recalculated a revised
debt discount on the notes.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The following table shows the changes to the principal balance
of the November 2014 10% Convertible Notes:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD COLSPAN="5" STYLE="border-bottom: Black 1pt solid">Activity in the November 2014 10% Convertible Notes</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 83%; text-align: left">Initial principal balance</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">527,780</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Increase in principal balance under the second amendment (see above)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">165,031</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Conversions during the fiscal year ended March 31, 2017</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(80,000</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 2.5pt">Balance as of June 30, 2017</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">612,811</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">DECEMBER 2016 10% CONVERTIBLE NOTES</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In December 2016, we entered into a securities purchase agreement
(the &ldquo;Securities Purchase Agreement&rdquo;) with two accredited investors (collectively, the &ldquo;Holders&rdquo;), pursuant
to which the Holders purchased an aggregate of $680,400 principal amount of Notes (inclusive of due diligence fee of $30,000 deemed
paid as a subscription amount in the form of a Note in the principal amount of $32,400) for an aggregate cash subscription amount
of $600,000 and (b) warrants to purchase 127,575 shares of Common Stock (collectively, the &ldquo;Warrants&rdquo;).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The Notes bear interest at the rate of 10% per annum, and the principal
amount and all accrued and unpaid interest thereon is convertible into shares of our common stock at a $4.00 per share conversion
price, which is subject to customary adjustment provisions for stock splits, dividends, recapitalizations and the like. The Notes
mature on July 1, 2018 and are subject to customary and usual terms for events of default and the like. Each Holder has contractually
agreed to restrict its ability to convert its Note such that the number of shares of the Common Stock held by the Holder and its
affiliates after such exercise does not exceed 4.99% of our then issued and outstanding shares of Common Stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The Warrants issued to the Holders are exercisable for a period
of five years from the date of issuance at an exercise price of $4.50, subject to adjustment. A Holder may exercise a Warrant
by paying the exercise price in cash or by exercising the Warrant on a cashless basis. In the event a Holder exercises a Warrant
on a cashless basis, we will not receive any proceeds. The exercise price of the Warrants is subject to customary adjustments
provision for stock splits, stock dividends, recapitalizations and the like. Each Holder has contractually agreed to restrict
its ability to exercise its Warrant such that the number of shares of the Common Stock held by the Holder and its affiliates after
such exercise does not exceed 4.99% of our then issued and outstanding shares of Common Stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The estimated relative fair value of Warrants issued in connection
with the Notes was recorded as a debt discount and is being amortized as additional interest expense over the term of the underlying
debt. We recorded debt discount of $232,718 based on the relative fair value of these Warrants. In addition, as the effective
conversion price of the Notes was less than market price of the underlying common stock on the date of issuance, we recorded an
additional debt discount of $262,718 related to the beneficial conversion feature. We also recorded deferred financing costs of
$102,940, which was composed of an 8% original issue discount of $50,400, a $30,000 due diligence fee (which was paid in the form
of a note), $22,500 in legal fees, and a $40 bank charge. The combination of the above items led to a combined discount against
the convertible notes of $598,376.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>June 2017 Amendment to the December 2016 10% Convertible Notes</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In June 2017, we agreed with the holders of the December 2016 10%
Convertible Notes to an extension of the expiration dates of the notes from July 1, 2018 to July 1, 2019 in exchange for the reduction
of the conversion price of those notes from $4.00 per share to $3.00 per share. The modification of the notes was evaluated under
ASC 470-50-40 and the instruments were determined to be substantially different, and the transaction qualified for extinguishment
accounting. Under the extinguishment accounting we recorded a loss on debt extinguishment of $198,254 and recalculated a revised
debt discount on the notes.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">There have been no conversions of principal on the December 2016
10% Convertible Notes through June 30, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">6. EQUITY TRANSACTIONS&nbsp;IN THE THREE MONTHS ENDED JUNE 30,
2017</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>Common Stock Sales Agreement with H.C. Wainwright</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">On June 28, 2016, we entered into a Common Stock Sales Agreement
(the &ldquo;Agreement&rdquo;) with H.C. Wainwright &amp; Co., LLC (&ldquo;H.C. Wainwright&rdquo;) which establishes an at-the-market
equity program pursuant to which we may offer and sell shares of our common stock from time to time as set forth in the Agreement.
The Agreement provides for the sale of shares of our common stock having an aggregate offering price of up to $12,500,000 (the
&ldquo;Shares&rdquo;).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Subject to the terms and conditions set forth in the Agreement,
H.C. Wainwright will use its commercially reasonable efforts consistent with its normal trading and sales practices to sell the
Shares from time to time, based upon our instructions. We have provided H.C. Wainwright with customary indemnification rights,
and H.C. Wainwright will be entitled to a commission at a fixed rate equal to three percent (3.0%) of the gross proceeds per Share
sold. In addition, we have agreed to pay certain expenses incurred by H.C. Wainwright in connection with the Agreement, including
up to $50,000 of the fees and disbursements of their counsel. The Agreement will terminate upon the sale of all of the Shares
under the Agreement unless terminated earlier by either party as permitted under the Agreement (see Note 14).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Sales of the Shares, if any, under the Agreement shall be made
in transactions that are deemed to be &ldquo;at the market offerings&rdquo; as defined in Rule 415 under the Securities Act, including
sales made by means of ordinary brokers&rsquo; transactions, including on the Nasdaq Capital Market, at market prices or as otherwise
agreed with H.C. Wainwright. We have no obligation to sell any of the Shares, and, at any time, we may suspend offers under the
Agreement or terminate the Agreement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In July 2016, we commenced sales of common stock under our Common
Stock Sales Agreement with H.C. Wainwright. In the three months ended June 30, 2017, we raised aggregate net proceeds of $1,903
(net of $63 in commissions to H.C. Wainwright and $133 in other offering expenses) under this agreement through the sale of 1,000
shares at an average price of $1.90 per share of net proceeds.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>Restricted Shares Issued for Services</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">During the three months ended June 30, 2017, we issued 15,000 shares
of restricted common stock at a price of $2.24 per share, the market price at time of issuance, in payment for investor relations
consulting services valued at $33,600 based on the value of the services provided.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>Share for Warrant Exchanges</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">During the three months ended June 30, 2017, we agreed with two
individual investors to exchange 11,497 restricted shares for the cancellation of 22,993 warrants.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Also during the three months ended June 30, 2017, we entered into
an Exchange Agreement with two institutional investors under which we issued 57,844 restricted shares in exchange for the cancellation
of 77,125 warrants held by those investors. Additionally, we agreed with those investors that they would extend the expiration
dates of convertible notes held by those investors from July 1, 2018 to July 1, 2019 in exchange for the reduction of the conversion
price of those notes from $4.00 per share to $3.00 per share (see Note 5). Based upon the fair value of the shares issued and
warrants exchanged, we recorded a loss of $119,789 during the three months ended June 30, 2017 for all of the above share for
warrant exchanges.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>Stock Option Issuances</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">During the three months ended June 30, 2017, we issued options
to four of our employees to purchase 34,500 shares of common stock at an exercise price of $1.68 per share, the closing price
on the date of the approval of the option grants by our compensation committee (see Note 9).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>Termination of Restricted Share Grant</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">During the three months ended June 30, 2017, we terminated a previously
recorded but unissued share issuance of 68,000 shares under a fully vested restricted stock grant to our CEO and issued to him
32,674 shares as a net settlement of shares and the Company paid the withholding taxes associated with that share issuance in
return for the cancellation of 35,326 shares. The compensation cost of that restricted stock grant had been fully recorded over
prior fiscal years, therefore no expense was recorded regarding this net issuance.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>Restricted Stock Unit Grants to Executive Officers</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">During the three months ended June 30, 2017, 46,125 RSUs held by
our executives were exchanged into the same number of shares of our common stock. As our executives elected to net settle a portion
of their RSU&rsquo;s in exchange for the Company paying the related withholding taxes on the share issuance, 23,655 of the RSUs
were cancelled and we issued a net 22,470 shares to our executives (see Note 9).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">7. RELATED PARTY TRANSACTIONS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">DUE TO RELATED PARTIES</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">During the three months June 30, 2017 we accrued unpaid Board fees
of $18,750 owed to our outside directors as of June 30, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">8. OTHER CURRENT LIABILITIES</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Other current liabilities were comprised of the following items:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">June 30,</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center">March 31,</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">2016</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">2017</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 66%; text-align: left">Accrued interest</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">37,721</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">5,391</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Other accrued liabilities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">45,124</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">64,076</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Total other current liabilities</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">82,845</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">69,467</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">9. STOCK COMPENSATION</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The following tables summarize share-based compensation expenses
relating to Restricted Stock Units (&ldquo;RSU&rdquo;s) and options granted and the effect on basic and diluted loss per common
share during the three month periods ended June 30, 2017 and 2016:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Three Months <BR> Ended <BR> June 30, <BR> 2017</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">Three Months<BR> Ended<BR> June 30, <BR> 2016</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 66%; text-align: left; padding-bottom: 1pt">Vesting of stock options and restricted stock units</TD><TD STYLE="width: 2%; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="width: 13%; border-bottom: Black 1pt solid; text-align: right">280,911</TD><TD STYLE="width: 1%; padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="width: 13%; border-bottom: Black 1pt solid; text-align: right">50,710</TD><TD STYLE="width: 1%; padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Total stock-based compensation expense</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">280,911</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">50,710</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 10pt; text-indent: -10pt">Weighted average number of common
    shares outstanding &ndash; basic and diluted</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">8,805,522</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">7,622,393</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 10pt; text-indent: -10pt">Basic and diluted loss per common
    share attributable to stock-based compensation expense</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(0.03</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(0.01</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">All of the stock-based compensation expense recorded during the
three months ended June 30, 2017 and 2016, which totaled $280,911 and $50,710, respectively, is included in payroll and related
expense in the accompanying condensed consolidated statements of operations.&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">We review share-based compensation on a quarterly basis for changes
to the estimate of expected award forfeitures based on actual forfeiture experience. The cumulative effect of adjusting the forfeiture
rate for all expense amortization is recognized in the period the forfeiture estimate is changed. The effect of forfeiture adjustments
for the three months ended June 30, 2017 was insignificant.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>Restricted Stock Unit Grants to Directors and Executive Officers</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">On August 9, 2016, our Board of Directors (the &ldquo;Board&rdquo;)
granted RSUs to certain of our officers and directors. The RSUs represent the right to be issued on a future date shares of our
common stock for vested RSUs. Our Compensation Committee recommended the grants based on a compensation assessment provided by
a third-party compensation consulting firm engaged by us that developed a peer group of companies for market assessment and analyzed
compensation at such companies.&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The RSUs were granted under our Amended 2010 Stock Incentive Plan
and we recorded expense of $260,699 in the three months ended June 30, 2017 related to the RSU grants.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">RSUs outstanding that have vested and are expected to vest as of
June 30, 2017 are as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Number of RSUs</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 83%">Vested</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 13%; text-align: right">46,125</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Expected to vest</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">461,250</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-bottom: 2.5pt">Total</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">507,375</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">During the three months ended June 30, 2017, 46,125 vested RSUs
held by our executives were exchanged into the same number of shares of our common stock. As our executives elected to net settle
a portion of their RSU&rsquo;s in exchange for the Company paying the related withholding taxes on the share issuance, 23,655
of the RSUs were cancelled and we issued a net 22,470 shares to our executives.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>Stock Option Activity</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">During the three months ended June 30, 2017, we issued options
to four of our employees to purchase 34,500 shares of common stock at a price of $1.68 per share, the closing price on the date
of the approval of the option grants by our compensation committee. There were no stock option grants during the three months
ended June 30, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Options outstanding that have vested and are expected to vest as
of June 30, 2017 are as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: black 1pt solid; text-align: center"><B>Number of</B><BR>
    <B>Shares</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: black 1pt solid; text-align: center"><B>Weighted</B><BR>
    <B>Average</B><BR>
    <B>Exercise</B><BR>
    <B>Price</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: black 1pt solid; text-align: center"><B>Weighted</B><BR>
    <B>Average</B><BR>
    <B>Remaining</B><BR>
    <B>Contractual</B><BR>
    <B>Term in</B><BR>
    <B>Years</B></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 50%">Vested</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 13%; text-align: right">414,547</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%">$</TD>
    <TD STYLE="width: 13%; text-align: right">11.24</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 13%; text-align: right">4.05</TD>
    <TD STYLE="width: 1%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>Expected to vest</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right">52,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>$</TD>
    <TD STYLE="text-align: right">2.80</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">8.71</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>Total</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double">&nbsp;</TD>
    <TD STYLE="border-bottom: black 2.25pt double; text-align: right">466,547</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The following outlines the significant weighted average assumptions
used to estimate the fair value information presented, with respect to stock option grants utilizing the Binomial Lattice option
pricing models at, and during the three months ended June 30, 2017:&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="background-color: rgb(238,238,238)">
    <TD STYLE="width: 70%">Risk free interest rate</TD>
    <TD STYLE="width: 30%; text-align: center">2.21%</TD></TR>
<TR STYLE="background-color: White">
    <TD>Average expected life</TD>
    <TD STYLE="text-align: center">10 years</TD></TR>
<TR STYLE="background-color: rgb(238,238,238)">
    <TD>Expected volatility</TD>
    <TD STYLE="text-align: center">92.14%</TD></TR>
<TR STYLE="background-color: White">
    <TD>Expected dividends&nbsp;</TD>
    <TD STYLE="text-align: center">None</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The expected volatility was based on the historic volatility. The
expected life of options granted was based on the &quot;simplified method&quot; as described in the SEC's guidance due to changes
in the vesting terms and contractual life of current option grants compared to our historical grants.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">A summary of stock option activity during the three months ended
June 30, 2017 is presented below:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Amount</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Range of<BR> Exercise Price</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Weighted<BR> Average <BR>
    Exercise<BR> Price</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 49%; text-align: left">Stock options outstanding at March 31, 2017</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 13%; text-align: right">432,047</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 13%; text-align: right">$3.80-$20.50</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">10.98</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>Exercised</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>Granted</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">34,500</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">$1.68</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">1.68</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1pt">Cancelled/Expired</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Stock options outstanding at June 30, 2017</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">466,547</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">$1.68-$20.50</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">10.30</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">Stock options exercisable at June 30, 2017</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">414,547</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">$3.80-$20.50</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">11.24</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">On June 30, 2017, our stock options had no intrinsic value since
the closing price on that date of $2.14 per share was below the weighted average exercise price of our stock options.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">At June 30, 2017, there was approximately $2,666,508 of unrecognized
compensation cost related to share-based payments, which is expected to be recognized over a weighted average period of 2.37 years.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">10. WARRANTS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">During the three months ended June 30, 2017, we did not issue any
warrants</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">A summary of warrant activity during the three months ended June
30, 2017 is presented below:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Amount</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Range of<BR> Exercise<BR> Price</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Weighted<BR> Average<BR>
    Exercise<BR> Price</TD><TD STYLE="padding-bottom: 1pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 49%">Warrants outstanding at March 31, 2017</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 13%; text-align: right">2,604,096</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 15%; text-align: center">$2.10 - $15.00</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">3.64</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>Exercised</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">n/a</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">n/a</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>Issued</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&ndash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">n/a</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">n/a</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1pt">Cancelled/Expired</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(128,357</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: center; padding-bottom: 1pt">$5.00 &ndash;$9.00</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left">$</TD><TD STYLE="padding-bottom: 1pt; text-align: right">5.80</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-bottom: 1pt">Warrants outstanding at June 30, 2017</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">2,475,739</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: center; padding-bottom: 1pt">$2.10 - $15.00</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left">$</TD><TD STYLE="padding-bottom: 1pt; text-align: right">3.47</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 2.5pt">Warrants exercisable at June 30, 2017</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">2,475,739</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: center; padding-bottom: 2.5pt">$2.10 - $15.00</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 2.5pt; text-align: left">$</TD><TD STYLE="padding-bottom: 2.5pt; text-align: right">3.47</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The following outlines the significant weighted average assumptions
used to estimate the fair value information presented, with respect to warrants utilizing the Binomial Lattice option pricing
models at, and during the three months ended June 30, 2016:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="background-color: rgb(238,238,238)">
    <TD STYLE="width: 70%">Risk free interest rate</TD>
    <TD STYLE="width: 30%; text-align: center">0.79% &ndash; 1.38%&nbsp;&nbsp;</TD></TR>
<TR STYLE="background-color: White">
    <TD>Average expected life&nbsp;</TD>
    <TD STYLE="text-align: center">3 months &ndash; 2.33 years</TD></TR>
<TR STYLE="background-color: rgb(238,238,238)">
    <TD>Expected volatility&nbsp;</TD>
    <TD STYLE="text-align: center">68% &ndash; 111%</TD></TR>
<TR STYLE="background-color: White">
    <TD>Expected dividends&nbsp;</TD>
    <TD STYLE="text-align: center">None</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The expected volatility was based on the historic volatility. The
expected life of options granted was based on the &quot;simplified method&quot; as described in the SEC's guidance due to changes
in the vesting terms and contractual life of current option grants compared to our historical grants.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Based on the above assumptions, we valued the warrants that were
exchanged for common stock (see Note 6) during the three months ended June 30, 2017 at $119,789.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">11. DARPA CONTRACT AND RELATED REVENUE RECOGNITION</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">As discussed in Note 1, we entered into a contract with Defense
Advanced Research Projects Agency (&ldquo;DARPA&rdquo;) on September 30, 2011. Under the DARPA award, we have been engaged to
develop a therapeutic device to reduce the incidence of sepsis, a fatal bloodstream infection that often results in the death
of combat-injured soldiers. The award from DARPA was a fixed-price contract with potential total payments to us of $6,794,389
over the course of five years. Fixed price contracts require the achievement of multiple, incremental milestones to receive the
full award during each year of the contract. Under the terms of the contract, we performed certain incremental work towards the
achievement of specific milestones against which we invoiced the government for fixed payment amounts.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Originally, only the base year (year one of the contract) was effective
for the parties; however, DARPA subsequently exercised its option on the remaining years of the contract. The milestones were
comprised of planning, engineering and clinical targets, the achievement of which in some cases required the participation and
contribution of third-party participants under the contract. We commenced work under the contract in October 2011 and completed
the contract in September 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In February 2014, DARPA reduced the scope of our contract in years
three through five of the contract. The reduction in scope focused our research on exosomes, viruses and blood processing instrumentation.
This scope reduction reduced the possible payments under the contract by $858,469 over years three through five.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The DARPA contract concluded on September 30, 2016. Also, during
the three months ended June 30, 2016, we did not invoice the U.S. Government for any milestones.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">12. SEGMENTS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">We operate our businesses principally through two reportable segments:
Aethlon, which represents our therapeutic business activities, and ESI, which represents our diagnostic business activities. Our
reportable segments have been determined based on the nature of the potential products being developed. We record discrete financial
information for ESI and our chief operating decision maker reviews ESI&rsquo;s operating results in order to make decisions about
resources to be allocated to the ESI segment and to assess its performance.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Aethlon&rsquo;s revenue is generated primarily from government
contracts to date and ESI does not yet have any revenues. We have not included any allocation of corporate overhead to the ESI
segment.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The following tables set forth certain information regarding our
segments:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="text-align: center; border-bottom: Black 1pt solid">Three Months Ended June 30,</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">2017</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid">2016</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>Revenues:</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: right">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 66%; padding-left: 10pt">Aethlon</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">&ndash;</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 13%; text-align: right">4,635</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-bottom: 1pt; padding-left: 10pt">ESI</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 20pt">Total Revenues</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">392,073</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">4,635</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Operating Losses:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-left: 10pt">Aethlon</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">(1,141,406</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">(1,092,990</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1pt; padding-left: 10pt">ESI</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(18,843</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(38,662</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 20pt">Total Operating Loss</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(1,160,249</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(1,131,652</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">Net Losses:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 10pt">Aethlon</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">(1,826,708</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">(2,097,887</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-bottom: 1pt; padding-left: 10pt">ESI</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(18,843</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(38,662</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 20pt">Net Loss Before Non-Controlling Interests</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(1,845,551</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(2,136,549</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>Cash:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-left: 10pt">Aethlon</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">326,464</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">1,291,537</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1pt; padding-left: 10pt">ESI</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">742</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">2,722</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 20pt">Total Cash</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">327,206</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">1,294,259</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">Total Assets:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 10pt">Aethlon</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">492,324</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">1,419,226</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-bottom: 1pt; padding-left: 10pt">ESI</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">16,827</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">41,806</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 20pt">Total Assets</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">509,151</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">1,461,032</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Capital Expenditures:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-left: 10pt">Aethlon</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">23,705</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">1,545</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1pt; padding-left: 10pt">ESI</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 20pt">Capital Expenditures</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">23,705</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">1,545</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">Depreciation and Amortization:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 10pt">Aethlon</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">9,326</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">5,323</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-bottom: 1pt; padding-left: 10pt">ESI</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">4,895</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 20pt">Total Depreciation and Amortization</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">9,326</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">10,218</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Interest Expense:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="padding-left: 10pt">Aethlon</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">(188,604</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">(42,167</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1pt; padding-left: 10pt">ESI</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">&ndash;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; padding-left: 20pt">Total Interest Expense</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(188,604</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right">(42,167</TD><TD STYLE="padding-bottom: 2.5pt; text-align: left">)</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;&nbsp;&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">13. COMMITMENTS AND CONTINGENCIES</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">LEASE COMMITMENTS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">We currently rent approximately 2,600 square feet of executive
office space at 9635 Granite Ridge Drive, Suite 100, San Diego, CA 92123 at the rate of $6,054 per month on a four-year lease
that expires in January 2019. We also rent approximately 1,700 square feet of laboratory space at 11585 Sorrento Valley Road,
Suite 109, San Diego, California 92121 at the rate of $4,394 per month on a one-year lease that was extended to an expiration
date of November 30, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Rent expense, which is included in general and administrative expenses,
approximated $35,000 and $34,000 for the three month periods ended June 30, 2017 and 2016, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">LEGAL MATTERS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">From time to time, claims are made against us in the ordinary course
of business, which could result in litigation. Claims and associated litigation are subject to inherent uncertainties and unfavorable
outcomes could occur, such as monetary damages, fines, penalties or injunctions prohibiting us from selling one or more products
or engaging in other activities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The occurrence of an unfavorable outcome in any specific period
could have a material adverse effect on our results of operations for that period or future periods. We are not presently a party
to any pending or threatened legal proceedings.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">14. SUBSEQUENT EVENTS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Management has evaluated events subsequent to June 30, 2017 through
the date that the accompanying condensed consolidated financial statements were filed with the Securities and Exchange Commission
for transactions and other events which may require adjustment of and/or disclosure in such financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Subsequent to June 30, 2017, we continued selling common stock
under our Common Stock Sales Agreement with H.C. Wainwright (see Note 6). Between the period of July 1, 2017 through August 10,
2017, we raised net proceeds of $40,377 (after deducting $1,290 in commissions to H.C. Wainwright and $1,326 in other offering
expenses) utilizing the sales agreement through the sale of 22,252 shares at an average price of $1.81 per share of net proceeds.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Also subsequent to June 30, 2017, we agreed with a former placement
agent to exchange 5,500 restricted shares for the cancellation of 11,000 warrants.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">On July 31, 2017, we filed an S-1 registration statement with the
SEC to raise up to $7.5 million through the sale of common stock and warrants. We engaged H.C. Wainwright &amp; Co, LLC as our
exclusive placement agent on the financing.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 12pt">Aethlon Medical,
Inc.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 12pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 12pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; background-color: white"><B>Up to 4,777,070
Units (each Unit contains 1 Share of Common Stock and 1 Common Warrant to purchase 1 Share of Common Stock)</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; background-color: white"><B>or</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; background-color: white"><B>Up to 4,777,070
Pre-funded Units (each Pre-funded Unit contains 1 Pre-funded Warrant to Purchase 1 Share of Common Stock and 1 Common Warrant
to purchase</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; background-color: white"><B>1 Share of
Common Stock)</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; background-color: white"><B>(4,777,070
Shares of Common Stock Underlying the Pre-funded Warrants) and</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; background-color: white"><B>(4,777,070
Shares of Common Stock Underlying the Common Warrants)</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Prospectus</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>H.C. Wainwright &amp; Co.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>, 2017</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 6pt"><P STYLE="margin: 0pt">&nbsp;</P></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: center; margin-bottom: 0pt"><B>PART II</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: center; margin-bottom: 0pt"><B>INFORMATION NOT
REQUIRED IN PROSPECTUS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Item 13. Other Expenses of Issuance and Distribution.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.5in 0pt 0; text-indent: 0.45in">The following table sets forth
the various expenses to be incurred in connection with the registration of the securities being registered by this registration
statement, all of which will be borne by us. All amounts shown are estimates except the Securities and Exchange Commission registration
fee.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.5in 0pt 0; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.5in 0pt 0; text-indent: 0.45in"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="width: 82%; text-align: left">Securities and Exchange Commission registration fee</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 14%; text-align: right">2,446.22</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">FINRA filing fee*</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">Transfer agent&rsquo;s fees and expenses*</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Printing and engraving expenses</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="text-align: left">Legal fees and expenses*</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Accounting fees and expenses*</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(238,238,238)">
    <TD STYLE="border-bottom: Black 1pt solid">Miscellaneous*</TD><TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt; border-bottom: Black 2.5pt double">Total expenses*</TD><TD STYLE="padding-bottom: 2.5pt; border-bottom: Black 2.5pt double">&nbsp;</TD>
    <TD STYLE="text-align: left; border-bottom: Black 2.5pt double">$</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD></TR>
</TABLE>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.5in 0pt 0; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-right: 0.5in; margin-bottom: 0pt; text-align: left">*Not
determinable at the time of filing and will be added by amendment.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Item 14. Indemnification of Directors and Officers.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Nevada Law</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.45in">We are incorporated in Nevada.
Subsection 1 of Section 78.7502 of the Nevada Revised Statutes empowers a corporation to indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in the right of the corporation) by reason of the fact that he is
or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation or other enterprise, against expenses (including attorneys&rsquo;
fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with such action,
suit or proceeding if he is not liable pursuant to Section 78.138 of the Nevada Revised Statutes or if he acted in good faith
and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to
any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful. Subsection 7 of Section 78.138
provides that, with certain exceptions, a director or officer is not individually liable to the corporation or its stockholders
or creditors for any damages as a result of any act or failure to act in his capacity as a director or officer unless it is proven
that (i) his act or failure to act constituted a breach of his fiduciary duties as a director or officer, and (ii) his breach
of those duties involved intentional misconduct, fraud or a knowing violation of the law.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.45in">Subsection 2 of Section 78.7502
empowers a corporation to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending
or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that
such person acted in any of the capacities set forth above against expenses, including amounts paid in settlement and attorneys&rsquo;
fees actually and reasonably incurred by him in connection with the defense or settlement of such action or suit if he acted under
similar standards, except that no indemnification may be made in respect of any claim, issue or matter as to which such person
shall have been adjudged by a court of competent jurisdiction to be liable to the corporation or for amounts paid in settlement
to the corporation, unless and only to the extent that the court in which such action or suit was brought or other court of competent
jurisdiction determines that, in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity
for such expenses as the court deems proper.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.45in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.5in">Section 78.7502 further provides
that to the extent a director or officer of a corporation has been successful in the defense of any action, suit or proceeding
referred to in subsections (1) and (2) thereof, or in the defense of any claim, issue or matter therein, he shall be indemnified
against expenses (including attorneys&rsquo; fees) actually and reasonably incurred by him in connection therewith. Subsection
3 of Section 78.751 of the Nevada Revised Statutes provides that the indemnification provided for by Section 78.7502 shall not
be deemed exclusive or exclude any other rights to which the indemnified party may be entitled (except that indemnification will
generally not be available to a person if a final adjudication establishes that his acts or omissions involved intentional misconduct,
fraud or a knowing violation of the law and were material to the cause of action) and that the indemnification shall continue
as to directors, officers, employees or agents who have ceased to hold such positions, and to their heirs, executors and administrators.
Section 78.752 empowers the corporation to purchase and maintain insurance on behalf of a director, officer, employee or agent
of the corporation against any liability asserted against him or incurred by him in any such capacity or arising out of his status
as such whether or not the corporation would have the power to indemnify him against such liabilities under Section 78.7502.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>By-Laws</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0; text-indent: 0.5in">Our by-laws provide for the elimination
of the personal liability of our officers, directors, corporate employees and agents to the fullest extent permitted by the provisions
of the Nevada Law. Under such provisions, we shall indemnify a director or officer (and may indemnify a corporate employee or
agent) who in his capacity as such is made, or threatened to be made, party to any suit or proceeding, if it is determined that
such person acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of our company
and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Liability Insurance</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.5in">We maintain directors&rsquo;
and officers&rsquo; liability insurance covering our directors and officers against expenses and liabilities arising from certain
actions to which they may become subject by reason of having served in such role, including insurance for claims against these
persons brought under securities laws. Such insurance is subject to the coverage amounts, exceptions, deductibles and other conditions
set forth in the policy as in effect at the time of a claim, if any. There is no assurance that we will maintain liability insurance
for our directors and officers.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Public Policy Limitations</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0; text-indent: 0.5in">Insofar as indemnification for
liabilities arising under the Securities Act of 1933, or Securities Act, may be permitted to our directors, officers and controlling
persons pursuant to the foregoing provisions, or otherwise, we have been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities (other than the payment by us of expenses incurred or paid
by one of our directors, officers or controlling persons in the successful defense of any action, suit or proceeding) is asserted
by such director, officer or controlling person in connection with the securities being registered, we will, unless in the opinion
of our counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question
whether such indemnification by us is against public policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Item 15. Recent Sales of Unregistered Securities.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0; text-indent: 0.5in">We have sold or issued the following
securities not registered under the Securities Act in reliance upon the exemption from registration pursuant to Section 4(a)(2)
of the Securities Act or Regulation D of the Securities Act during the three years preceding the filing of this registration statement.
Except as stated below, no underwriting discounts or commissions were payable with respect to any of the following transactions.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><I>Equity Issuances in the Fiscal Year Ended March 31, 2017.</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><I>&nbsp;</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><BR>
<B>Common Stock Sales Agreement with H.C. Wainwright</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0; text-indent: 0.5in">On June 28, 2016, we entered
into a Common Stock Sales Agreement (the &ldquo;Agreement&rdquo;) with H.C. Wainwright &amp; Co., LLC (&ldquo;H.C. Wainwright&rdquo;)
which establishes an at-the-market equity program pursuant to which we may offer and sell shares of our common stock from time
to time as set forth in the Agreement. The Agreement provides for the sale of shares of our common stock having an aggregate offering
price of up to $12,500,000 (the &ldquo;Shares&rdquo;).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in; text-indent: 0.45in">Subject to the terms and conditions
set forth in the Agreement, H.C. Wainwright will use its commercially reasonable efforts consistent with its normal trading and
sales practices to sell the Shares from time to time, based upon our instructions. We have provided H.C. Wainwright with customary
indemnification rights, and H.C. Wainwright will be entitled to a commission at a fixed rate equal to three percent (3.0%) of
the gross proceeds per Share sold. In addition, we have agreed to pay certain expenses incurred by H.C. Wainwright in connection
with the Agreement, including up to $50,000 of the fees and disbursements of their counsel. The Agreement will terminate upon
the sale of all of the Shares under the Agreement unless terminated earlier by either party as permitted under the Agreement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">Sales of the Shares, if
any, under the Agreement shall be made in transactions that are deemed to be &ldquo;at the market offerings&rdquo; as defined
in Rule 415 under the Securities Act, including sales made by means of ordinary brokers&rsquo; transactions, including on the
Nasdaq Capital Market, at market prices or as otherwise agreed with H.C. Wainwright. We have no obligation to sell any of the
Shares, and, at any time, we may suspend offers under the Agreement or terminate the Agreement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0.05in; text-indent: 0.45in">In July 2016, we commenced
sales of common stock under our Common Stock Sales Agreement with H.C. Wainwright. In the fiscal year ended March 31, 2017, we
raised aggregate net proceeds of $955,206 (net of $29,831 in commissions to H.C. Wainwright and $9,432 in other offering expenses)
under this agreement through the sale of 216,078 shares at an average price of $4.42 per share of net proceeds.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.05in"><B>Warrant Issuances in July 2016</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.05in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">In July 2016, we issued
an aggregate of 2,660 shares of common stock to three investors upon the exercise of previously issued warrants. The warrants
were exercised on a cashless or &ldquo;net&rdquo; basis. Accordingly, we did not receive any proceeds from such exercises. The
cashless exercise of such warrants resulted in the cancellation of previously issued warrants to purchase an aggregate of 19,563
shares of common stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.05in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.05in"><B>Restricted Stock Unit Grants to Directors and
Executive Officers</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.05in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.55in 0pt 0.05in; text-indent: 0.45in">During the fiscal year
ended March 31, 2017, 149,864 Restricted Stock Units (&ldquo;RSUs&rdquo;) held by our outside directors and executive officers
were exchanged into the same number of shares of our common stock (see Stock-Based Compensation below).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.55in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.05in"><B>Amendment of Warrants Issued in Conjunction with
the November 2014 10% Convertible Notes</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.05in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in; text-indent: 0.45in">Under the Second Amendment and Extension
of the November 2014 10% Convertible Notes dated June 27, 2016 (See Note 4), we reduced the purchase price of 47,125 Warrants
from $8.40 per share to $5.00 per share.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">We also issued to the investors
new warrants to purchase an aggregate of 30,000 shares of common stock with a purchase price of $5.00 per share of common stock.
We issued the new warrants in substantially the same form as the prior Warrants, and the new warrants will expire on November
6, 2019, the same date on which the prior warrants will expire (See Note 4).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.05in"><B>Amendment of December 2014 Warrants</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.05in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in; text-indent: 0.45in">On June 27, 2016, we and certain
investors (the &ldquo;Unit Investors&rdquo;) entered into Consent and Waiver and Amendment agreements (the &ldquo;CWAs&rdquo;),
relating to an aggregate of 264,000 Warrants to Purchase Common Stock (the &ldquo;Unit Warrants&rdquo;) we had issued to the Unit
Investors on December 2, 2014 pursuant to a Securities Purchase Agreement dated November 26, 2014 (the &ldquo;2014 SPA&rdquo;).
In the CWAs, each of the Unit Investors provided its consent under certain restrictive provisions, and waived certain rights,
including a right to participate in certain offerings made by us, under the 2014 SPA in order to facilitate the at-the-market
equity program described above. Pursuant to the CWAs, we reduced the Exercise Price (as defined in the Unit Warrants) from $15.00
per share of common stock to $5.00 per share of common stock. At any time that the shares of common stock underlying the Unit
Warrants are covered by an effective registration statement that permits the public resale of the shares, if the Unit Investors
exercise the Unit Warrants, they must do so by a cash exercise, which could yield up to $1,320,000 in proceeds to us.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.4in 0pt 0.05in; text-indent: 0.45in">On June 27, 2016, each
of the Unit Investors also entered into a Consent and Waiver providing its consent under certain provisions, and waiving certain
rights, including a right to participate in certain offerings made by us, under the 2015 SPA in order to facilitate the at-the-market
equity program described above.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.4in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.4in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.4in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.4in 0pt 0.05in; text-indent: 0.45in"></P>

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    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.4in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">In accordance with applicable
generally accepted accounting principles in the United States of America (GAAP) for warrant modifications, we measured the change
in fair value that arose from the reduction in exercise price and recognized an expense of $345,841, which is included in other
(income) expenses in the accompanying condensed consolidated statements of operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.05in"><B>Warrants Issued in Conjunction with the December
2016 10% Convertible Notes</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.05in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">On December 30, 2016, we
entered into a securities purchase agreement (the &ldquo;Securities Purchase Agreement&rdquo;) with two accredited investors (collectively,
the &ldquo;Holders&rdquo;), pursuant to which the Purchasers purchased an aggregate of $680,400 principal amount of Notes (inclusive
of due diligence fee of $30,000 deemed paid as a subscription amount in the form of a Note in the principal amount of $32,400)
for an aggregate cash subscription amount of $600,000 and (b) warrants to purchase 127,575 shares of Common Stock (collectively,
the &ldquo;Warrants&rdquo;) (See Note 4).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0.05in; text-indent: 0.45in">The Warrants issued to
the Holders are exercisable for a period of five years from the date of issuance at an exercise price of $4.50, subject to adjustment.
A Holder may exercise a Warrant by paying the exercise price in cash or by exercising the Warrant on a cashless basis. In the
event a Holder exercises a Warrant on a cashless basis, we will not receive any proceeds. The exercise price of the Warrants is
subject to customary adjustments provision for stock splits, stock dividends, recapitalizations and the like. Each Holder has
contractually agreed to restrict its ability to exercise its Warrant such that the number of shares of the Common Stock held by
the Holder and its affiliates after such exercise does not exceed 4.99% of our then issued and outstanding shares of Common Stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">The estimated relative
fair value of Warrants issued in connection with the Notes was recorded as a debt discount and is amortized as additional interest
expense over the term of the underlying debt. We recorded debt discount of $232,718 based on the relative fair value of these
Warrants.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.05in"><B>March 2017 Registered Direct Offering</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.05in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">On March 22, 2017, we entered
into a Securities Purchase Agreement (the &ldquo;Purchase Agreement&rdquo;) with certain institutional investors (the &ldquo;Investors&rdquo;)
for the sale of 575,000 shares (the &ldquo;Common Shares&rdquo;) of our common stock, par value $0.001 per share (the &ldquo;Common
Stock&rdquo;), at a purchase price of $3.50 per share, in a registered direct offering. Concurrently with the sale of the Common
Shares, pursuant to the Purchase Agreement, we also sold in a private placement warrants to purchase 575,000 shares of Common
Stock (the &ldquo;Warrants&rdquo;). The aggregate gross proceeds for the sale of the Common Shares and Warrants will be approximately
$2 million. Subject to certain ownership limitations, the Warrants will be initially exercisable commencing six months from the
issuance date at an exercise price equal to $3.95 per share of Common Stock, subject to adjustments as provided under the terms
of the Warrants. The Warrants will be exercisable for five years from the initial exercise date.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.35in 0pt 0.05in; text-indent: 0.45in">The net proceeds to us
from the transactions, after deducting the placement agent&rsquo;s fees and expenses (not including the Wainwright Warrants, as
defined below), our estimated offering expenses, and excluding the proceeds, if any, from the exercise of the Warrants, were $1,804,250.
We intend to use the net proceeds from the transactions for general corporate purposes.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.35in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">The Common Shares (but
not the Warrants or shares issuable upon exercise of the Warrant) were sold by us pursuant to an effective shelf registration
statement on Form S-3, which was filed with the Securities and Exchange Commission (the &ldquo;SEC&rdquo;) on May 5, 2016 and
subsequently declared effective on May 12, 2016 (File No. 333-211151) (the &ldquo;Registration Statement&rdquo;), and the base
prospectus dated as of May 12, 2016 contained therein. We filed a prospectus supplement and the accompanying prospectus with the
SEC in connection with this sale of the Common Shares.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">The purchase agreement
also covered the exchange of 264,000 warrants issued to the purchasers thereunder in December 2014 for 198,000 shares of our common
stock. Further, in exchange for certain waivers given by the purchasers and certain other investors in a private placement of
the Company in June 2015, the warrants issued in such private placement were amended to (i) reduce the exercise price to $3.95
per share, (ii) make the warrants non-exercisable for a period of six months from the date of amendment, and (iii) extend the
term of those warrants by six months.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">The Warrants and the shares
issuable upon exercise of the Warrants were sold and issued without registration under the Securities Act of 1933 (the &ldquo;Securities
Act&rdquo;) in reliance on the exemptions provided by Section 4(a)(2) of the Securities Act as transactions not involving a public
offering and Rule 506 promulgated under the Securities Act as sales to accredited investors, and in reliance on similar exemptions
under applicable state laws.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.5in">We also entered into an engagement
letter (the &ldquo;Engagement Letter&rdquo;) with Rodman &amp; Renshaw, a unit of H.C. Wainwright &amp; Co., LLC (&ldquo;Rodman&rdquo;),
pursuant to which Rodman agreed to serve as exclusive placement agent for the issuance and sale of the Common Shares and Warrants.
We paid Rodman an aggregate fee equal to 6% of the gross proceeds received by us from the sale of the securities in the transactions.
Pursuant to the Engagement Letter, we also agreed to grant to Rodman or its designees warrants to purchase up to 3% of the aggregate
number of shares sold in the transaction (the &ldquo;Rodman Warrants&rdquo;). The Engagement Letter has a nine-month tail and
right of first offer periods, indemnity and other customary provisions for transactions of this nature. The Rodman Warrants have
substantially the same terms as the Warrants, except that the exercise price is 125% of $3.50. We also paid Rodman a reimbursement
for non-accountable expenses in the amount of $50,000.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0"><I>Equity Issuances in the Fiscal Year Ended March
31, 2016</I>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.5in">On June 25, 2015, we sold $6,000,000
of units, comprised of common stock and warrants, to 18 accredited investors at a price of $6.30 per unit. Each unit consisted
of one share of common stock and 0.75 of a five-year warrant to purchase one share of common stock at an exercise price of $6.30
per share. Accordingly, we issued a total of 952,383 shares of unregistered common stock and warrants to purchase 714,285 shares
of common stock. For its services as sole placement agent for the financing, we paid Roth Capital Partners, LLC (&ldquo;Roth&rdquo;)
a cash fee of $285,512 and expense reimbursement of $75,000 and we issued them a five-year warrant to purchase 32,371 shares of
common stock at an exercise price of $6.30 per share. We received $5,591,988 in net proceeds from this financing. As the warrants
that were issued to the investors and to Roth were issued in connection with common stock for cash, they were considered issued
in connection with the financing transaction and the warrant fair value, which was valued using a binomial lattice model, was
recorded to additional paid-in-capital.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.25in 0pt 0; text-indent: 0.5in">In connection with the financing,
Mr. James Joyce, our Chief Executive Officer, Mr. James Frakes, our Chief Financial Officer and Dr. Chetan Shah, a director of
our company, each agreed to waive their right to exercise certain stock options and warrants held by them representing the right
to acquire 402,318 shares of common stock in the aggregate (the &ldquo;Waivers&rdquo;). The Waivers were required in order to
make a sufficient number of shares of common stock available for issuance and the Waivers expired when we amended our Articles
of Incorporation on March 31, 2016, to increase the number of authorized shares of our common stock from 10,000,000 to 30,000,000,
following stockholder approval of such amendment at our annual stockholders&rsquo; meeting on March 29, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.25in 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.5in">During the three months ended
September 30, 2015, we issued an aggregate of 5,292 shares of common stock to an accredited investor upon the exercise of previously
issued warrants. The warrants were exercised on a cashless or &ldquo;net&rdquo; basis. Accordingly, we did not receive any proceeds
from such exercises. The cashless exercise of such warrants resulted in the cancellation of previously issued warrants to purchase
an aggregate of 1,744 shares of common stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.5in">During the three months ended
December 31, 2015, we issued an aggregate of 6,757 unregistered shares of common stock to two investors upon the exercise of previously
issued warrants. The warrants were exercised for cash and we received cash proceeds of $14,766 for an average purchase price of
$2.19 per share per the terms of the warrants.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0"><I>Equity Transactions in the Fiscal Year Ended
March 31, 2015</I>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.5in">On May 20, 2014, May 23, 2014,
June 6, 2014, June 11, 2014 and June 26, 2014, we sold seven accredited investors 43,849 shares of restricted common stock for
an aggregate purchase price of $320,800 and an average price of $7.50 per share. The common stock purchase price was calculated
as 80% of the average closing price of our common stock for the five-day period immediately preceding the date of each subscription
agreement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.5in">On June 24, 2014, we issued
the holder of a convertible note 466,365 shares of restricted common stock and five-year warrants to acquire up to 136,190 shares
of common stock at an exercise price of $2.10 per share and up to 7,944 shares of common stock at an exercise price of $5.40 per
share. We issued the stock and warrants upon the conversion of a combined principal and interest balance of $1,003,200 due under
the note. We also issued the holder 1,500 shares of common stock as a service fee for converting the note in full and for agreeing
to waive anti-dilution price protection in certain warrants previously issued to the holder by us.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.5in">On July 8, 2014, we issued the
holder of a convertible note 51,837 shares of restricted common stock and five-year warrants to acquire up to 46,429 shares of
common stock at an exercise price of $2.10 per share and up to 2,708 shares of common stock at an exercise price of $5.40 per
share. We issued the stock and warrants upon the conversion of the interest balance of $116,970 due under the note and for the
holder&rsquo;s agreement to extend the expiration date of the note. We also issued the holder 500 shares of common stock as a
service fee for extending the note, for converting the interest due under the note and for agreeing to waive anti-dilution price
protection in certain warrants previously issued to the holder by us.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0.05in; text-indent: 0.45in">On August 6, 2014, we issued
7,806 shares of restricted common stock at an average price of $12.00 per share to a consultant in payment for investor relations
consulting services valued at $75,000 based on the value of the services provided.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in; text-indent: 0.45in">On July 15, 2014, we issued 38,750
shares of restricted common stock to the holders of three convertible notes in exchange for the partial or full conversion of
principal and interest in the aggregate amount of $81,375 at a conversion price of $2.10 per share.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0.05in; text-indent: 0.45in">On July 24, 2014, we issued
an aggregate of 50,079 shares of restricted common stock and a seven-year warrant to issue up to 25,040 shares of common stock
at an exercise price of $6.60 per share to Dr. Chetan Shah, one of our directors. We issued the common stock and warrant to Dr.
Shah upon the conversion of an aggregate of $220,349 of unpaid principal and accrued interest due under a 10% Convertible Note
previously issued to Dr. Shah by us on July 9, 2013.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in; text-indent: 0.45in">On September 17, 2014, we issued
to the holder of the remaining 2008 10% Convertible Note units consisting of an aggregate of 9,564 shares of restricted common
stock and unit warrants to acquire up to an aggregate of 4,782 shares of common stock at an exercise price of $4.80 per share.
The units were issued to the note holder upon the conversion of an aggregate of $45,906 of unpaid principal and accrued interest
due under the promissory note, which represented the entire amount outstanding under the note.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in; text-indent: 0.45in">On July 29, 2014, August 4, 2014
and August 6, 2014, we issued to four investors 53,465 shares of restricted common stock through the cash exercise of eight warrants
for $259,474 of cash at an average exercise price of approximately $5.00 per share. As an inducement to those investors, we issued
them replacement warrants to acquire up to an aggregate of 53,465 shares of common stock on the same terms as the warrants they
exercised.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in; text-indent: 0.45in">On August 29, 2014, September 2,
2014 and September 25, 2014, we issued and sold to three accredited investors units consisting of (a) 2,000 restricted shares
of our common stock at prices per share ranging from $4.55 to $4.70 and (b) a five-year warrant to purchase 1,000 shares of common
stock at exercise prices ranging from $6.80 to $7.15 per share. In total, the investors purchased for cash an aggregate of $90,000
of units. The investors acquired an aggregate of 19,500 shares of common stock and warrants to acquire up to an aggregate of 9,750
shares of common stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in; text-indent: 0.45in">On November 7, 2014, we issued 3,400
shares of restricted common stock at price of $10.25 per share, along with a cash payment of $50,000, in full repayment of the
outstanding principal balance and interest balance on the Law Firm Note.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in; text-indent: 0.45in">On October 10, 2014, October 14,
2014 and October 15, 2014, we issued and sold to eight accredited investors units consisting of (a) 2,000 restricted shares of
common stock at prices per share ranging from $5.25 to $5.70 and (b) a five-year warrant to purchase 1,000 shares of common stock
at exercise prices ranging from $7.70 to $8.35 per share. In total, the investors purchased for cash an aggregate of $502,700
of units. The investors acquired an aggregate of 90,125 shares of common stock and warrants to acquire up to an aggregate of 45,063
shares of common stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0.05in; text-indent: 0.45in">On October 9, 2014, we
issued to an accredited investor units consisting of an aggregate of 36,716 shares of restricted common stock and warrants to
acquire up to an aggregate of 18,358 shares of common stock at an exercise price of $7.70 per share. We issued the units to the
investor upon the conversion of an aggregate of $189,087 of unpaid principal and accrued interest due under two promissory notes
(the remaining October and November 2009 10% Convertible Note and the April 2010 10% Convertible Note) previously issued to the
investor by us. The amounts converted represented the entire principal and interest outstanding under the notes and the notes
held by that holder were retired.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in; text-indent: 0.45in">On October 17, 2014 and October 20,
2014, we issued an aggregate of 113,422 shares of restricted common stock and seven-year warrants to issue up to an aggregate
of 113,422 shares of common stock at exercise prices ranging from $4.30 to $6.25 per share to eight accredited investors. One
of the investors is Dr. Shah. The common stock and warrants were issued to the investors upon the cash exercise of previously
issued warrants held by them. The investors paid an aggregate of $579,251 upon exercise of the previously outstanding warrants
at exercise prices ranging from $4.30 to $6.25 per share.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.25in 0pt 0.05in; text-indent: 0.45in">On October 15, 2014, we
issued an aggregate of 70,460 shares of restricted common stock to two accredited investors upon the conversion of an aggregate
of $147,965 of unpaid principal and accrued interest due under promissory notes previously issued to the investors by us. The
conversion price per share was $2.10.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.25in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.25in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.25in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.25in 0pt 0.05in; text-indent: 0.45in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.25in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">On November 6, 2014, we
sold two accredited investors (i) convertible promissory notes in the aggregate principal amount of $527,780 and (ii) five year
warrants to purchase up to 47,123 shares of common stock at a fixed exercise price of $8.40 per share. The convertible promissory
notes bear interest at the annual rate of 10% and mature on April 1, 2016. The aggregate gross cash proceeds to us were $415,000
after subtracting legal fees of $35,000; the balance of the principal amount of the notes represents a $27,780 due diligence fee
and an original issuance discount. The convertible promissory notes are convertible at the option of the holders into shares of
our common stock at a fixed price of $5.60 per share, for up to an aggregate of 94,246 shares of common stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">On October 21, 2014, we
issued an aggregate of 328,463 shares of restricted common stock to three accredited investors upon the cashless exercise of warrants
previously issued to the investors by us with an exercise price of $2.10 per share.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">On November 12, 2014, we
issued 780 shares of restricted common stock to a consultant in payment for investor relations services valued at $8,000 based
on the value of the services provided.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.35in 0pt 0.05in; text-indent: 0.45in">On November 18, 2014,
we issued an aggregate of 112,500 shares of restricted common stock to two investors upon the conversion of an aggregate of $236,250
of unpaid principal and accrued interest under a promissory note previously issued by us. The conversion price was $2.10 per share.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.35in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.3in 0pt 0.05in; text-indent: 0.45in">On November 19, 2014 we
issued 285 shares of restricted common stock to an investor upon the cashless exercise of warrants previously issued by us with
an exercise price of $5.50 per share.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.3in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">On November 25, 2014, we
issued an aggregate of 214,286 shares of restricted common stock to two accredited investors upon the conversion of an aggregate
of $450,000 of unpaid principal and accrued interest due under promissory notes previously issued by us with a conversion price
of $2.10 per share.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">On November 26, 2014, we
authorized the issuance of an aggregate of 88,165 shares of restricted common stock to 38 accredited investors upon the cashless
exercise of warrants previously issued to the investors by us with an exercise price of $11.00 per share.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">On November 26, 2014, we
authorized the issuance of 9,921 shares of restricted common stock to an accredited investor upon the cashless exercise of warrants
previously issued by us with an exercise price of $5.50 per share.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">On December 2, 2014, we
sold $3,300,000 of units, comprised of common stock and warrants, to three affiliated institutional investors at a price of $15.00
per unit. Each unit consisted of one share of common stock and five-year warrants to purchase 1.2 shares of common stock at an
exercise price of $15.00 per share. Accordingly, we issued a total of 220,000 shares of restricted common stock and warrants to
purchase 264,000 shares of common stock. For its services as sole placement agent for the financing, we paid Roth Capital Partners,
LLC a cash fee of $231,000 and expense reimbursement of $25,000 and we issued it a five-year warrant to purchase 11,000 shares
of common stock at an exercise price of $15.00 per share.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0.05in; text-indent: 0.45in">On December 5, 2014, we
issued an aggregate of 3,500 shares of restricted common stock to two affiliated accredited investors upon the cashless exercise
of warrants previously issued by us with an exercise price of $2.10 per share.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.35in 0pt 0.05in; text-indent: 0.45in">On January 2, 2015, we
issued 47,619 shares of common stock to an accredited investor upon the conversion of $100,000 of unpaid principal due under a
promissory note we previously issued to the investor. The conversion price per share was $2.10.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.35in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.3in 0pt 0.05in; text-indent: 0.45in">On January 14, 2015, we
authorized the issuance of 3,574 shares of common stock to an accredited investor upon the cashless exercise of warrants previously
issued by us with an exercise price of $5.50 per share.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.3in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0.05in; text-indent: 0.45in">On March 16, 2015, we issued
37,265 shares of common stock to an accredited investor upon the conversion of an aggregate of $78,257 of unpaid principal and
accrued interest due under a promissory note we previously issued to the investor. The conversion price per share was $2.10.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0.05in; text-indent: 0.45in">On March 30, 2015, we issued
13,803 shares of common stock to an accredited investor upon the conversion of an aggregate of $28,988 of unpaid principal and
accrued interest due under a promissory note we previously issued to the investor. The conversion price per share was $2.10.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0.05in; text-indent: 0.45in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Item 16. Exhibits and Financial Statement Schedules.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.25in 0pt 0; text-indent: 0.45in">Reference is made to the Exhibit
Index filed as part of this registration statement. All exhibits have been filed previously unless otherwise noted.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.25in 0pt 0; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Item 17. Undertakings.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The undersigned
registrant hereby undertakes:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0; text-indent: 0.45in">(1) To file, during any period
in which offers or sales are being made, a post-effective amendment to this registration statement:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.45in; text-indent: 0.5in">(i)<FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;
</FONT>To include any prospectus required by section 10(a)(3) of the Securities Act of 1933;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.45in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.45in; text-indent: 0.5in">(ii)<FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;
</FONT>To reflect in the prospectus any facts or events arising after the effective date of this registration statement (or the
most recent post-effective amendment hereof) which, individually or in the aggregate, represent a fundamental change in the information
set forth in this registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered
(if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or
high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant
to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate
offering price set forth in the &ldquo;Calculation of Registration Fee&rdquo; table in the effective registration statement; and</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.45in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0.45in; text-indent: 0.5in">(iii)<FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;
</FONT>To include any material information with respect to the plan of distribution not previously disclosed in this registration
statement or any material change to such information in this registration statement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0.45in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0; text-indent: 0.45in">(2) That, for the purpose of
determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0; text-indent: 0.45in">(3) To remove from registration
by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering;
and</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.4in 0pt 0; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0; text-indent: 0.45in">(4) That, for the purpose of
determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities,
in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting
method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of
the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or
sell such securities to such purchaser:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.3in 0pt 0.45in; text-indent: 0.5in">(i)<FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;
</FONT>Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant
to Rule 424;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.3in 0pt 0.45in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0.45in; text-indent: 0.5in">(ii)&nbsp;Any free writing
prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned
registrant;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0.45in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.3in 0pt 0.45in; text-indent: 0.5in">(iii)<FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;
</FONT>The portion of any other free writing prospectus relating to the offering containing material information about the undersigned
registrant or its securities provided by or on behalf of the undersigned registrant; and</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.3in 0pt 0.45in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.3in 0pt 0.45in; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.3in 0pt 0.45in; text-indent: 0.5in">(iv) Any other communication
that is an offer in the offering made by the undersigned registrant to the purchaser.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.3in 0pt 0.45in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.3in 0pt 0.45in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.3in 0pt 0.45in; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.3in 0pt 0.45in; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.3in 0pt 0.45in; text-indent: 0.5in">&nbsp;</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0; text-indent: 0.45in">(5)<FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;
</FONT>That, for purposes of determining any liability under the Securities Act of 1933, the information omitted from the form
of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed
by the registrant pursuant to Rule 424(b) (1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration
statement as of the time it was declared effective. <FONT STYLE="background-color: white">Each prospectus filed pursuant to Rule
424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or
other than prospectuses filed in reliance on Rule 430A (&sect;230.430A of this chapter), shall be deemed to be part of and included
in the registration statement as of the date it is first used after effectiveness. <I>Provided, however,</I> that no statement
made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or
deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will,
as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in
the registration statement or prospectus that was part of the registration statement or made in any such document immediately
prior to such date of first use.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in; text-indent: 0.45in"><FONT STYLE="background-color: white">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0; text-indent: 0.45in">(6)<FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;
</FONT>That, for the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that
contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.15in 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0.05in">(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Insofar
as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion
of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant
of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered,
the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court
of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0.05in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0.05in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0.05in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0.05in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.2in 0pt 0.05in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: center; margin-bottom: 0pt"><B>SIGNATURES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: center; margin-bottom: 0pt"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-align: justify; text-indent: 0.5in">Pursuant
to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on
its behalf by the undersigned, thereunto duly authorized, in the City of San Diego, State of California, on September 29, 2017. </P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.05in 0pt 0; text-align: justify; text-indent: 0.5in"></P>

<TABLE BORDER="0" CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD COLSPAN="2"><B>AETHLON MEDICAL, INC.,</B></TD></TR>
<TR>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD COLSPAN="2">a Nevada corporation</TD></TR>
<TR>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD></TR>
<TR>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid">/s/ James A. Joyce</TD></TR>
<TR>
    <TD STYLE="vertical-align: top; width: 50%">&nbsp;</TD>
    <TD STYLE="width: 4%">By:</TD>
    <TD STYLE="vertical-align: top; width: 46%">James A. Joyce<BR></TD></TR>
<TR>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD>Its:</TD>
    <TD STYLE="vertical-align: top">Chief Executive Officer</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; text-indent: 0pt; margin-top: 0pt; margin-bottom: 6pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0; text-align: justify; text-indent: 0.5in">Pursuant
to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the
capacities and on the dates indicated:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0; text-align: justify; text-indent: 0.5in"></P>

<TABLE BORDER="0" CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; border-collapse: collapse; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: middle">
    <TD STYLE="font-weight: bold; text-decoration: underline; width: 44%">Signature</TD>
    <TD STYLE="font-weight: bold; text-decoration: underline; width: 42%">Title</TD>
    <TD STYLE="font-weight: bold; text-decoration: underline; width: 14%">Date</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD> &nbsp; </TD></TR>
<TR STYLE="vertical-align: middle">
    <TD STYLE="text-decoration: underline">/s/ James A. Joyce</TD>
    <TD>Chairman, Chief Executive Officer, Principal Executive Officer</TD>
    <TD> September 29, 2017 </TD></TR>
<TR>
    <TD STYLE="vertical-align: middle">James A. Joyce</TD>
    <TD STYLE="vertical-align: bottom; text-align: left">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom"> &nbsp; </TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD> &nbsp; </TD></TR>
<TR STYLE="vertical-align: middle">
    <TD STYLE="text-decoration: underline">/s/ James B. Frakes</TD>
    <TD>Chief Financial Officer, Principal Accounting Officer</TD>
    <TD> September 29, 2017 </TD></TR>
<TR>
    <TD STYLE="vertical-align: middle">James B. Frakes</TD>
    <TD STYLE="vertical-align: bottom; text-align: left">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom"> &nbsp; </TD></TR>
<TR>
    <TD STYLE="vertical-align: middle">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom"> &nbsp; </TD></TR>
<TR STYLE="vertical-align: middle">
    <TD STYLE="text-decoration: underline">s/ Edward G. Broenniman</TD>
    <TD>Director</TD>
    <TD> September 29, 2017 </TD></TR>
<TR>
    <TD STYLE="vertical-align: middle">Edward G. Broenniman</TD>
    <TD STYLE="vertical-align: bottom; text-align: left">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom"> &nbsp; </TD></TR>
<TR>
    <TD STYLE="vertical-align: middle">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom"> &nbsp; </TD></TR>
<TR STYLE="vertical-align: middle">
    <TD STYLE="text-decoration: underline">/s/ Rodney S. Kenley</TD>
    <TD>Director</TD>
    <TD> September 29, 2017 </TD></TR>
<TR>
    <TD STYLE="vertical-align: middle">Rodney S. Kenley</TD>
    <TD STYLE="vertical-align: bottom; text-align: left">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom"> &nbsp; </TD></TR>
<TR>
    <TD STYLE="vertical-align: middle">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom"> &nbsp; </TD></TR>
<TR STYLE="vertical-align: middle">
    <TD STYLE="text-decoration: underline">/s/ Chetan S. Shah</TD>
    <TD>Director</TD>
    <TD> September 29, 2017 </TD></TR>
<TR>
    <TD STYLE="vertical-align: middle">Chetan S. Shah, MD</TD>
    <TD STYLE="vertical-align: bottom; text-align: left">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom"> &nbsp; </TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.1in 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>INDEX TO EXHIBITS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>&nbsp;</B></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 10%"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>No.</B></FONT></TD>
    <TD STYLE="width: 90%"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Description</B></FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">1.1</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000168316817001901/aethlon_ex0101.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Engagement
    Agreement, dated July 28, 2017, between Aethlon Medical, Inc. and H.C. Wainwright &amp; Co., LLC</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;
    (46) </FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">2.1</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000106299399000010/0001062993-99-000010.txt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Agreement
    and Plan of Reorganization Between Aethlon Medical, Inc. (formerly, Bishop Equities, Inc.) and Aethlon, Inc. dated March 10,
    1999</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(1)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">2.2</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000106299399000010/0001062993-99-000010.txt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Agreement
    and Plan of Reorganization Between Aethlon Medical, Inc. (formerly, Bishop Equities, Inc.) and Hemex, Inc. dated March 10,
    1999</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(1)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">3.1</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968716006120/aethlon_s1-ex0301.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Articles
    of Incorporation of Aethlon Medical, Inc., as amended</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(2)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">3.2</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968715002535/aethlon_10k-ex0302.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Bylaws
    of Aethlon Medical, Inc., as amended</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(35)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">4.1</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968714004876/aethlon_s1-ex0401.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Common Stock Certificate</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(3)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">4.2</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968710002509/aethlon_ex1026.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Amended and Restated Warrant dated June 14, 2010</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(12)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">4.3</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968710002509/aethlon_ex1027.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Amended and Restated Warrant dated June 14, 2010</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(QB)
    (12)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">4.4</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968712001301/aethlon_ex0401.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Common Stock Purchase Warrant dated March 29, 2012 and April 15, 2012</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(14)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">4.5</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968712002232/aethlon_8k-ex0401.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Common Stock Purchase Warrant dated June 19, 2012</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(15)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">4.6</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968712003217/aethlon_8k-ex0401.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Common Stock Purchase Warrant dated August 29, 2012</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(16)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">4.7</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968713000435/aemd_10q-ex401.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Common Stock Purchase Warrant dated October, November and December 2012</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(17)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">4.8</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968713003054/aethlon_10q-ex401.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Common Stock Purchase Warrant dated June 14, 2013</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(18)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">4.9</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968713004105/aethlon_8k-ex0401.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Common Stock Purchase Warrant October 30, 2013</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(19)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">4.10</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968713004552/aethlon_8k-ex0401.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Common Stock Purchase Warrant November 12, 2013</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(20)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">4.11</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968713004832/aethlon_8k-ex0401.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Common Stock Purchase Warrant December 10, 2013</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(21)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">4.12</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968714000066/aethlon_8k-ex0401.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Common Stock Purchase Warrant December 30, 2013</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(22)</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD STYLE="width: 10%"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">4.13</FONT></TD>
    <TD STYLE="width: 90%"><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968714001271/aethlon_ex1001.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Amendment to Notes and Warrants dated March 31, 2014</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(23)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">4.14</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968714002585/aethlon_8k-ex0401.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Common Stock Purchase Warrant dated June 24, 2014</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(24)</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD STYLE="width: 10%"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">4.15</FONT></TD>
    <TD STYLE="width: 90%"><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968714002697/aethlon_8k-ex0401.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Common Stock Purchase Warrant dated July 8, 2014</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(25)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">4.16</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968714002828/aethlon_8k-ex401.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Common Stock Purchase Warrant dated July 24, 2014</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(26)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">4.17</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968714004132/aemd_10q-ex0403.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Common Stock Purchase Warrant issued August and September 2014</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(27)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">4.18</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968714004132/aemd_10q-ex0404.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Class A Common Stock Purchase Warrant dated November 6, 2014</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(27)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">4.19</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968714004132/aemd_10q-ex1003.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Convertible Promissory Note dated November 6, 2014</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(27)</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD STYLE="width: 10%"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">4.20</FONT></TD>
    <TD STYLE="width: 90%"><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968714004525/aethlon_8k-ex0401.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Common Stock Purchase Warrant issued December 2, 2014</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(29)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">4.21</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968714004566/aethlon_8k-ex0401.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Purchase Agent Warrant dated December 2, 2014</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(30)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">4.22</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968715002499/aemd_8k-ex0401.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Warrant to Purchase Common Stock issued June 25, 2015</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(32)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">4.23</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968715002528/aemd_8k-ex0401.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Purchase Agent Warrant issued June 25, 2015</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(33)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">4.24</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968716006780/aethlon_ex0401.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Amendment to Notes and Warrants dated June 27, 2016</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(40)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">4.25</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968716006780/aethlon_ex0402.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Allonge to Convertible Promissory Note dated June 27, 2016</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(40)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">4.26</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968716006780/aethlon_ex0403.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Class A Common Stock Purchase Warrant issued June 27, 2016</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(40)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">4.27</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968716006780/aethlon_ex0404.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Consent and Waiver and Amendment dated June 27, 2016</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(40)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">4.28</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000168316817000627/aethlon_ex0401.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Warrant Agreement issued March 22, 2017</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(43)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD>4.29</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000168316817002401/aethlon_s1a-ex0429.htm">Form of Warrant</A>&nbsp;
    (48)</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD>4.30</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000168316817002459/aethlon_s1a2-ex0430.htm">Form of Placement Agent
    Warrant</A> (49)</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD>4.31</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000168316817002401/aethlon_s1a-ex0431.htm">Form of Pre-Funded Warrant</A>
    &nbsp; (48)</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">5.1</FONT></TD>
    <TD><A HREF="aethlon_ex0501.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Opinion of Jolie
    Kahn, Esq.</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;*</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.1</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968715001510/aethlon_s1-ex1001.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">2000
    Stock Option Plan</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(34) ***</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.2</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968716005682/aethlon_8k-ex1001.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Amended
    2010 Stock Incentive Plan</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(4)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.3</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968715001510/aethlon_s1-ex1003.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">2005
    Directors Compensation Program</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(34)
    ***</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.4</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968715001510/aethlon_s1-ex1004.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">2012
    Directors Compensation Program, as amended on June 6, 2014</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(34)
    ***</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.5</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000104746999027653/0001047469-99-027653.txt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Employment
    Agreement between Aethlon Medical, Inc. and James A. Joyce dated April 1, 1999</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(5)
    ***</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.6</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968704002009/hemex.txt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Patent
    License Agreement by and amongst Aethlon Medical, Inc., Hemex, Inc., Dr. Julian L. Ambrus and Dr. David O. Scamurra</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(6)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.7</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968704002009/tullis.txt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Employment
    Agreement by and between Aethlon Medical, Inc. and Dr. Richard H. Tullis dated January 10, 2000</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(6)
    ***</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.8</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968705001945/aethlon_10kex10-24.txt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Stock
    Option Agreement by and between Aethlon Medical, Inc. and James A Joyce dated February 23, 2005</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(7)
    ***</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.9</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968705001945/aethlon_10kex10-25.txt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Stock
    Option Agreement by and between Aethlon Medical, Inc. and Richard Tullis dated February 23, 2005</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(7)
    ***</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.10</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968705001945/aethlon_10kex10-26.txt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Stock
    Option Agreement by and between Aethlon Medical, Inc. and Franklyn S. Barry, Jr. dated February 23, 2005</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(7)
    ***</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.11</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968705001945/aethlon_10kex10-27.txt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Stock
    Option Agreement by and between Aethlon Medical, Inc. and Ed Broenniman dated February 23, 2005</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(7)
    ***</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.12</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968705002574/aethlon_8kex4-1.txt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Stock
    Option Agreement by and between Aethlon Medical, Inc. and James A. Joyce dated September 9, 2005</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(8)
    ***</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.13</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968710002848/aethlon_s8-ex9901.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Stock
    Option Agreement by and between Aethlon Medical, Inc. and James A. Joyce dated June 13, 2007</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(9)
    ***</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.14</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968708005552/aethlon_8k-ex1001.txt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Stock
    Option Agreement by and between Aethlon Medical, Inc. and James A. Joyce dated December 15, 2008</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(10)
    ***</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.15</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968708005552/aethlon_8k-ex1002.txt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Stock
    Option Agreement by and between Aethlon Medical, Inc. and Franklyn S. Barry dated December 15, 2008</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(10)
    ***</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD STYLE="width: 10%"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.16</FONT></TD>
    <TD STYLE="width: 90%"><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968708005552/aethlon_8k-ex1003.txt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Stock
    Option Agreement by and between Aethlon Medical, Inc. and Edward G. Broenniman dated December 15, 2008</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(10)
    ***</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.17</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968708005552/aethlon_8k-ex1004.txt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Stock
    Option Agreement by and between Aethlon Medical, Inc. and Richard H. Tullis dated December 15, 2008</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(10)
    ***</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD STYLE="width: 10%"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.18</FONT></TD>
    <TD STYLE="width: 90%"><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968709004139/aethlon_10qex10-7.txt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Standard
    Industrial Net Lease by and between Sorrento Business Complex and Aethlon Medical, Inc. dated September 28, 2009</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(11)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.19</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968710003861/aethlon_8k-ex1001.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Offer
    of Employment by and between Aethlon Medical, Inc. and Rodney S. Kenley dated October 27, 2010</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(13)
    ***</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.20</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968710003861/aethlon_8k-ex1002.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Stock
    Option Agreement of Rodney S. Kenley dated October 27, 2010</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(13)
    ***</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.21</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968712001301/aethlon_8k-ex1001.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Unit
    Subscription Agreement dated March 29, 2012 and April 5, 2012</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(14)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.22</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968712002232/aethlon_8k-ex1001.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Unit
    Subscription Agreement dated June 19, 2012</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(15)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.23</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968712003217/aethlon_8k-ex1001.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Unit
    Subscription Agreement dated August 29, 2012</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(16)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.24</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968713000435/aemd_10q-ex1001.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Unit
    Subscription Agreement dated October, November and December 2012</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(17)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.25</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968713003054/aethlon_10q-ex1001.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Unit
    Subscription Agreement dated June 14, 2013</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(18)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.26</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968713004105/aethlon_8k-ex1001.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Unit Purchase Agreement dated October 30, 2013</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(19)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.27</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968713004105/aethlon_8k-ex1002.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Subscription Agreement October 30, 2013</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(19)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.28</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968713004552/aethlon_8k-ex1001.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Unit Purchase Agreement dated November 12, 2013</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(20)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.29</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968713004552/aethlon_8k-ex1002.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Subscription Agreement November 12, 2013</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(20)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.30</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968713004832/aethlon_8k-ex1001.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Unit Purchase Agreement dated December 10, 2013</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(21)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.31</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968713004832/aethlon_8k-ex1002.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Subscription Agreement December 10, 2013</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(21)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.32</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968714000066/aethlon_8k-ex1001.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Unit Purchase Agreement dated December 30, 2013</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(22)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.33</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968714000066/aethlon_8k-ex1002.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Subscription Agreement December 30, 2013</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(22)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.34</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968714002585/aethlon_8k-ex1001.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Restructuring Agreement dated June 24, 2014</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(24)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.35</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968714002585/aethlon_8k-ex1002.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Restructuring Agreement dated June 24, 2014</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(24)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.36</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968714002697/aethlon_8k-ex1001.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Restructuring Agreement dated July 8, 2014</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(25)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.37</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968714004876/aethlon_s1-ex1052.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Second
    Amendment to Standard Industrial Net Lease by and between Sorrento Business Complex and Aethlon Medical, Inc. dated October
    10, 2014</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(3)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.38</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968714004132/aemd_10q-ex1002.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Subscription Agreement dated November 6, 2014</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(27)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.39</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968714004404/aethlon_8k-ex1001.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Office
    Lease between T-C Stonecrest LLC and Aethlon Medical, Inc. dated November 13, 2014</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(28)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.40</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968714004525/aethlon_8k-ex1001.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Securities
    Purchase Agreement dated November 26, 2014</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(29)</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top; background-color: white">
    <TD STYLE="width: 10%">&nbsp;</TD>
    <TD STYLE="width: 90%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.41</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968714004525/aethlon_8k-ex1002.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Registration
    Rights Agreement dated November 26, 2014</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(29)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.42</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968714004876/aethlon_s1-ex1057.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">DARPA
    Contract dated September 30, 2011</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(3)
    (Portions of this exhibit have been omitted pursuant to a request for confidential treatment.)</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD STYLE="width: 10%"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.43</FONT></TD>
    <TD STYLE="width: 90%"><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968714004876/aethlon_s1-ex1058.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">DARPA
    Contract Extension dated August 8, 2012</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(3)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.44</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968714004876/aethlon_s1-ex1059.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">DARPA
    Contract Extension dated September 15, 2013</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(3)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.45</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968714004876/aethlon_s1-ex1060.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">DARPA
    Contract Extension dated September 29, 2014</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(3)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.46</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968715001510/aethlon_s1-ex1052.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">DARPA
    Contract Modification dated March 12, 2015</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(34)
    (Portions of this exhibit have been omitted pursuant to a request for confidential treatment.)</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD STYLE="width: 10%"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.47</FONT></TD>
    <TD STYLE="width: 90%"><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968715001438/aethlon_ex1001.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">UCI
    Clinical Trial Agreement signed April 9, 2015</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(31)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.48</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968715001438/aethlon_ex1002.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Protocol
    for UCI Clinical Trial</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(31)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.49</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968715001438/aethlon_ex1003.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Budget
    for UCI Clinical Trial</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(31)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.50</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968715002535/aethlon_10k-ex1056.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">DaVita
    Master Services Agreement</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(35)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.51</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968715002535/aethlon_10k-ex1057.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">First
    Amendment to DaVita Master Services Agreement</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(35)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.52</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968715002535/aethlon_10k-ex1058.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Work
    Order #1 under DaVita Master Services Agreement</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(35)
    (Portions of this exhibit have been omitted pursuant to a request for confidential treatment.)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.53</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968715002499/aemd_8k-ex1001.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Securities
    Purchase Agreement dated June 23, 2015</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(32)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.54</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968715002499/aemd_8k-ex1002.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Registration
    Rights Agreement dated June 23, 2015</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(32)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.55</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968715003556/aethlon_8k-ex1001.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">DARPA
    Contract Extension dated September 25, 2015</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(36)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.56</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968715003774/aethlon_ex1001.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Amendment
    No. 1 to Joyce Employment Agreement dated October 16, 2015</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(37)
    ***</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.57</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968715003774/aethlon_ex1002.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Amendment
    No. 1 to Kenley Offer Letter dated October 16, 2015</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(37)
    ***</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.58</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968715003774/aethlon_ex1003.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Retention
    Bonus Agreement dated October 16, 2015</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(37)
    ***</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.59</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968715004160/aethlon_10q-ex1005.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Third
    Amendment to Standard Industrial Net Lease dated October 21, 2015</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(38)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.60</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968715004160/aethlon_10q-ex1006.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Amendment
    of Terms dated November 12, 2015</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(38)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.61</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968716005192/aethlon_ex1001.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Consulting
    Agreement dated February 9, 2016</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(39)</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: #EEEEEE">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.62</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968716006800/aethlon_10k-ex1062.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Stock
    Option Agreement by and between Aethlon Medical, Inc. and Richard Tullis dated September 27, 2010</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(44)
    ***</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top; background-color: white">
    <TD STYLE="width: 10%">&nbsp;</TD>
    <TD STYLE="width: 90%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.63</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968716006800/aethlon_10k-ex1063.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Stock
    Option Agreement by and between Aethlon Medical, Inc. and Richard Tullis dated July 1, 2013</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(44)
    ***</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.64</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968716006800/aethlon_10k-ex1064.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Stock
    Option Agreement by and between Aethlon Medical, Inc. and Richard Tullis dated June 6, 2014</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(44)
    ***</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.65</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968716006800/aethlon_10k-ex1065.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Amendment
    No. 1 to Stock Option Agreement by and between Aethlon Medical, Inc. and Richard Tullis dated December 15, 2008</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(44)
    ***</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.66</FONT></TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968716006800/aethlon_10k-ex1066.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Amendment
    No. 1 to Stock Option Agreement by and between Aethlon Medical, Inc. and Richard Tullis dated September 27, 2010</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(44)
    ***</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="background-color: #EEEEEE">
    <TD STYLE="vertical-align: top; width: 10%"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.67</FONT></TD>
    <TD STYLE="vertical-align: bottom; width: 90%"><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968716006800/aethlon_10k-ex1067.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Amendment
    No. 1 to Stock Option Agreement by and between Aethlon Medical, Inc. and Richard Tullis dated July 1, 2013</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(44)
    ***</FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="background-color: #EEEEEE">
    <TD STYLE="vertical-align: top"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.68</FONT></TD>
    <TD STYLE="vertical-align: bottom"><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968716006800/aethlon_10k-ex1068.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Amendment
    No. 1 to Stock Option Agreement by and between Aethlon Medical, Inc. and Richard Tullis dated June 6, 2014</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(44)
    ***</FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="background-color: #EEEEEE">
    <TD STYLE="vertical-align: top"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.69</FONT></TD>
    <TD STYLE="vertical-align: bottom"><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968716006780/aethlon_ex1001.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Common
    Stock Sales Agreement dated June 28, 2016 between Aethlon Medical, Inc. and H.C. Wainwright &amp; Co., LLC</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(40)</FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="background-color: #EEEEEE">
    <TD STYLE="vertical-align: top"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.70</FONT></TD>
    <TD STYLE="vertical-align: bottom"><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968716006780/aethlon_ex0404.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Consent and Waiver dated June 27, 2016</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(40)</FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="background-color: #EEEEEE">
    <TD STYLE="vertical-align: top"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.71</FONT></TD>
    <TD STYLE="vertical-align: bottom"><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968716007148/aethlon_8k-ex1001.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Aethlon
    Medical, Inc. 2012 Non-Employee Directors Compensation Program, as Modified on August 9, 2016</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(41)
    ***</FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="background-color: #EEEEEE">
    <TD STYLE="vertical-align: top"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.72</FONT></TD>
    <TD STYLE="vertical-align: bottom"><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000168316816000543/aethlon_10q-ex1001.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">DARPA
    Contract dated September 30, 2011</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(42)</FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="background-color: #EEEEEE">
    <TD STYLE="vertical-align: top"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.73</FONT></TD>
    <TD STYLE="vertical-align: bottom"><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000168316817001671/aethlon_ex1073.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">2012
    Non-Employee Directors Compensation Program, as amended August 9, 2016</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(45)
    ***</FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="background-color: #EEEEEE">
    <TD STYLE="vertical-align: top"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.74</FONT></TD>
    <TD STYLE="vertical-align: bottom"><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000168316817001671/aethlon_ex1074.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Stock
    Unit Agreement by and between Aethlon Medical, Inc. and James A. Joyce dated August 29, 2016</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(45)
    ***</FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="background-color: #EEEEEE">
    <TD STYLE="vertical-align: top"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.75</FONT></TD>
    <TD STYLE="vertical-align: bottom"><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000168316817001671/aethlon_ex1075.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Stock
    Unit Agreement by and between Aethlon Medical, Inc. and Rodney S. Kenley dated August 29, 2016</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(45)
    ***</FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="background-color: #EEEEEE">
    <TD STYLE="vertical-align: top"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.76</FONT></TD>
    <TD STYLE="vertical-align: bottom"><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000168316817001671/aethlon_ex1076.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Stock
    Unit Agreement by and between Aethlon Medical, Inc. and James B. Frakes dated August 29, 2016</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(45)
    ***</FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="background-color: #EEEEEE">
    <TD STYLE="vertical-align: top"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.77</FONT></TD>
    <TD STYLE="vertical-align: bottom"><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000168316817001671/aethlon_ex1077.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Stock
    Unit Agreement by and between Aethlon Medical, Inc. and Franklyn S. Barry, Jr. dated August 29, 2016</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(45)
    ***</FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="background-color: #EEEEEE">
    <TD STYLE="vertical-align: top"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.78</FONT></TD>
    <TD STYLE="vertical-align: bottom"><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000168316817001671/aethlon_ex1078.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Stock
    Unit Agreement by and between Aethlon Medical, Inc. and Edward G. Broenniman dated August 29, 2016</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(45)
    ***</FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="background-color: rgb(238,238,238)">
    <TD STYLE="vertical-align: top"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.79</FONT></TD>
    <TD STYLE="vertical-align: bottom"><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000168316817001671/aethlon_ex1079.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Stock
    Unit Agreement by and between Aethlon Medical, Inc. and Chetan S. Shah, MD dated August 29, 2016</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(45)
    ***</FONT></TD></TR>
<TR STYLE="background-color: White">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="background-color: rgb(238,238,238)">
    <TD STYLE="vertical-align: top"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.80</FONT></TD>
    <TD STYLE="vertical-align: bottom"><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000168316817001671/aethlon_ex1080.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Fourth
    Amendment to Standard Industrial Net Lease by and between AGP Sorrento Business Complex, L.P. and Aethlon Medical, Inc. dated
    October 5, 2016</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(45)</FONT></TD></TR>
<TR STYLE="background-color: White">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="background-color: rgb(238,238,238)">
    <TD STYLE="vertical-align: top"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.81</FONT></TD>
    <TD STYLE="vertical-align: bottom"><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000168316817000627/aethlon_ex1001.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Securities Purchase Agreement, dated March 22, 2017</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(43)</FONT></TD></TR>
<TR STYLE="background-color: White">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="background-color: rgb(238,238,238)">
    <TD STYLE="vertical-align: top"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.82</FONT></TD>
    <TD STYLE="vertical-align: bottom"><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000168316817000627/aethlon_ex1002.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Engagement Letter, dated March 15, 2017</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(43)</FONT></TD></TR>
<TR STYLE="background-color: White">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="background-color: rgb(238,238,238)">
    <TD STYLE="vertical-align: top"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10.83</FONT></TD>
    <TD STYLE="vertical-align: bottom"><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000168316817001671/aethlon_ex1083.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Form
    of Exchange Agreement</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(45)</FONT></TD></TR>
<TR STYLE="background-color: White">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="background-color: rgb(238,238,238)">
    <TD STYLE="vertical-align: top">10.84</TD>
    <TD STYLE="vertical-align: bottom"><A HREF="aethlon_ex1084.htm">Form of Securities Purchase Agreement</A>&nbsp;*</TD></TR>
<TR STYLE="background-color: White">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="background-color: rgb(238,238,238)">
    <TD STYLE="vertical-align: top"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">14</FONT></TD>
    <TD STYLE="vertical-align: bottom"><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000168316817001671/aethlon_ex1400.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">Code
    of Ethics</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(45)</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="background-color: white">
    <TD STYLE="vertical-align: top; width: 9%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 91%">&nbsp;</TD></TR>
<TR STYLE="background-color: #EEEEEE">
    <TD STYLE="vertical-align: top"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">21.1</FONT></TD>
    <TD STYLE="vertical-align: bottom"><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000101968714004876/aethlon_s1-ex2101.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: blue">List
    of subsidiaries</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(3)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="background-color: #EEEEEE">
    <TD STYLE="vertical-align: top"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">23.1</FONT></TD>
    <TD STYLE="vertical-align: bottom"><A HREF="aethlon_ex2301.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Consent
    of Independent Registered Public Accounting Firm (Squar Milner LLP)</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;*</FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="background-color: rgb(238,238,238)">
    <TD STYLE="vertical-align: top"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">23.2</FONT></TD>
    <TD STYLE="vertical-align: bottom"><A HREF="aethlon_ex0501.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Consent
    of Jolie Kahn, Esq.</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;(included in
    </FONT><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000168316817002459/aethlon_s1a2-ex0430.htm"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Exhibit
    5.1</FONT></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">) *</FONT></TD></TR>
<TR STYLE="background-color: White">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="background-color: rgb(238,238,238)">
    <TD STYLE="vertical-align: top">99.1</TD>
    <TD STYLE="vertical-align: bottom"><A HREF="http://www.sec.gov/Archives/edgar/data/882291/000168316817002347/aethlon_8k-ex9901.htm">Letter
    from FDA to Registrant, dated September 8, 2017 (47)</A></TD></TR>
<TR STYLE="background-color: White">
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="background-color: rgb(238,238,238)">
    <TD STYLE="vertical-align: top"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">101</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Interactive Data
    Files *</FONT></TD></TR>
<TR STYLE="background-color: White">
    <TD STYLE="vertical-align: top"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">101.INS</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">XBRL Instance
    Document*</FONT></TD></TR>
<TR STYLE="background-color: rgb(238,238,238)">
    <TD STYLE="vertical-align: top"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">101.SCH</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">XBRL Schema Document*</FONT></TD></TR>
<TR STYLE="background-color: White">
    <TD STYLE="vertical-align: top"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">101.CAL</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">XBRL Calculation
    Linkbase Document*</FONT></TD></TR>
<TR STYLE="background-color: rgb(238,238,238)">
    <TD STYLE="vertical-align: top"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">101.DEF&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">XBRL Definition
    Linkbase Document*</FONT></TD></TR>
<TR STYLE="background-color: White">
    <TD STYLE="vertical-align: top"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">101.LAB</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">XBRL Label Linkbase
    Document*</FONT></TD></TR>
<TR STYLE="background-color: rgb(238,238,238)">
    <TD STYLE="vertical-align: top"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">101.PRE</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">XBRL Presentation
    Linkbase Document*</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">________________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD STYLE="width: 5%"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">*</FONT></TD>
    <TD STYLE="width: 95%"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed herewith</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>***</TD>
    <TD>Indicates a management contract or compensatory plan or arrangement</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(1)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company's Current Report on Form
    8-K/A dated March 26, 1999 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(2)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company's Registration Statement
    on Form S-3 (File No. 333-211151) filed on May 5, 2016 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(3)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Registration
    Statement on Form S-1 (File No. 333-201334) filed on December 31, 2014 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(4)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Current Report
    on Form 8-K dated March 30, 2016 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(5)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company's Annual Report on Form
    10-KSB filed on July 15, 1999 for the year ended March 31, 1999 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(6)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company's Annual Report on Form
    10-KSB/A filed on September 10, 2004 for the year ended March 31, 2004 and incorporated by reference.</FONT></TD></TR>

<TR STYLE="vertical-align: top; background-color: White">
    <TD STYLE="width: 5%"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(7)</FONT></TD>
    <TD STYLE="width: 95%"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company's
    Annual Report on Form 10-KSB filed on July 14, 2005 for the year ended March 31, 2005 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(8)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company's Current Report on Form
    8-K filed on September 12, 2005 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(9)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Registration
    Statement on Form S-8 (File No. 333-168483) filed on August 2, 2010 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(10)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company's Current Report on Form
    8-K dated December 19, 2008 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(11)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Quarterly Report
    on Form 10-Q filed on November 16, 2009 for the period ended September 30, 2009 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(12)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Annual Report
    on Form 10-K filed on July 2, 2010 for the year ended March 31, 2010 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(13)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Current Report
    on Form 8-K dated November 1, 2010 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(14)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Current Report
    on Form 8-K dated April 6, 2012 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(15)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Current Report
    on Form 8-K dated June 27, 2012 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(16)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Current Report
    on Form 8-K dated September 6, 2012 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(17)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Quarterly Report
    on Form 10-Q filed on February 12, 2013 for the period ended December 31, 2012 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(18)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Quarterly Report
    on Form 10-Q filed on August 13, 2013 for the period ended June 30, 2013 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(19)&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Current Report
    on Form 8-K dated November 6, 2013 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(20)&nbsp;&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Current Report
    on Form 8-K dated November 20, 2013 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(21)&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Current Report
    on Form 8-K dated December 16, 2013 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(22)&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Current Report
    on Form 8-K dated January 7, 2014 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(23)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Current Report
    on Form 8-K dated April 4, 2014 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(24)&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Current Report
    on Form 8-K dated June 30, 2014 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(25)&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Current Report
    on Form 8-K dated July 10, 2014 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(26)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Current Report
    on Form 8-K dated July 28, 2014 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(27)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Quarterly Report
    on Form 10-Q filed on November 10, 2014 for the period ended September 30, 2014 and incorporated by reference.</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

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<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top; background-color: white">
    <TD STYLE="width: 5%">&nbsp;</TD>
    <TD STYLE="width: 95%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(28)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Current Report
    on Form 8-K/A dated November 19, 2014 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(29)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Current Report
    on Form 8-K dated November 28, 2014 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(30)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Current Report
    on Form 8-K dated December 3, 2014 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(31)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Current Report
    on Form 8-K dated April 15, 2015 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(32)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Current Report
    on Form 8-K dated June 24, 2015 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(33)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Current Report
    on Form 8-K dated June 26, 2015 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(34)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company's Registration Statement
    on Form S-1 (File No. 333-203487) filed on April 17, 2015 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(35)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Annual Report
    on Form 10-K filed on June 26, 2015 for the year ended March 31, 2015 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(36)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Current Report
    on Form 8-K dated September 28, 2015 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(37)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Current Report
    on Form 8-K dated October 22, 2015 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(38)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Quarterly Report
    on Form 10-Q filed on November 16, 2015 for the period ended September 30, 2015 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(39)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Current Report
    on Form 8-K dated February 16, 2016 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(40)&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Current Report
    on Form 8-K dated June 28, 2016 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(41)&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Current Report
    on Form 8-K dated August 10, 2016 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(42)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Quarterly Report
    for the quarter ended September 30, 2016 dated November 10, 2016 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(43)&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Current Report
    on Form 8-K dated March 22, 2017 and incorporated by reference.</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(44)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Annual Report
    for the year ended March 31, 2016, dated June 29, 2016</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(45)</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed with the Company&rsquo;s Annual Report
    for the year ended March 31, 2017, dated June 28, 2017</FONT></TD></TR>

<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD>(46)</TD>
    <TD>Filed with the Company&rsquo;s Registration Statement on Form S-1 (File No. 333-219589), dated July 31, 2017 and incorporated
    by reference.</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>(47)</TD>
    <TD>Filed with the Company&rsquo;s Current Report on Form 8-K dated September 12, 2017 and incorporated herein by reference.</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(238,238,238)">
    <TD>(48)</TD>
    <TD>Filed with the Company&rsquo;s Amendment No. 1 to Registration Statement on Form S-1, dated September 18, 2017 and incorporated
    herein by reference.</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>(49)</TD>
    <TD><P STYLE="margin: 0pt 0">Filed with the Company&rsquo;s Amendment No. 2 to Registration Statement on Form S-1, dated September
        22, 2017 and incorporated herein by reference.</P>


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<DOCUMENT>
<TYPE>EX-5.1
<SEQUENCE>2
<FILENAME>aethlon_ex0501.htm
<DESCRIPTION>OPINION
<TEXT>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right"><B>Exhibit 5.1</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Jolie Kahn, Esq.<BR>
33 Edgewood<BR>
Locust Valley, NY 11560<BR>
(516) 217-6379</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">September 29, 2017</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Aethlon Medical, Inc.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">9635 Granite Ridge Drive, Suite 100</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">San Diego, California 92123</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Ladies and Gentlemen:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.45in">I have acted as counsel to Aethlon Medical,
Inc., a Nevada corporation (the &ldquo;<I><U>Company</U></I>&rdquo;), in connection with the Company&rsquo;s registration statement
on Form S-1, as amended (the &ldquo;<I><U>Registration Statement</U></I>&rdquo;), filed with the Securities and Exchange Commission
(the &ldquo;<I><U>Commission</U></I>&rdquo;) under the Securities Act of 1933, as amended (the &ldquo;<I><U>Securities Act</U></I>&rdquo;),
relating to the issuance and sale of up to 4,777,070 units (the &ldquo;<U>Units&rdquo;</U>) (each consisting of a share of common
stock of the Company and a warrant to purchase one share of common stock), 4,777,070 shares of common stock of the Company, par
value $0.001 per share (the &ldquo;<I><U>Shares</U></I>&rdquo;) and 4,777,070 warrants to purchase common stock (the &ldquo;<I><U>Warrants</U></I>&rdquo;)
and the shares of common stock of the Company issuable from time to time upon exercise of the Warrants (the &ldquo;<U>Warrant Shares</U>&rdquo;);
up to 4,777,070 pre-funded units (the &ldquo;<U>Pre-Funded Units</U>&rdquo;), each consisting of a pre-funded warrants to purchase
shares (each, a &ldquo;<U>Pre-Funded Warrant</U>&rdquo; and collectively, the &ldquo;<U>Pre-Funded Warrants</U>&rdquo;) and any
shares issuable upon exercise of the Pre-funded Warrants (the &ldquo;<U>Pre-Funded Warrant Shares</U>&rdquo;; the Units, Shares,
Warrants, Warrant Shares, Pre-Funded Units, Pre-Funded Warrants and Pre-Funded Warrant Shares are collectively referred to herein
as the &ldquo;<U>Securities</U>&rdquo;), issued by the Company. The Securities are to be sold by Company pursuant to a Engagement
Agreement (the &ldquo;<U>Engagement Agreement</U>&rdquo;) entered into by and between the Company and H.C. Wainwright &amp; Co.,
LLC the form of which is to be filed as Exhibit 1.1 to the Registration Statement. The Company is also registering warrants to
purchase shares of common stock of the Company to be issued to the placement agent as additional compensation pursuant to the Engagement
Agreement (the &ldquo;<U>Placement Agent&rsquo;s Warrant</U>&rdquo;), as well as the shares of Common Stock issuable upon exercise
of the Placement Agent&rsquo;s Warrant (the &ldquo;<U>Placement Agent&rsquo;s Warrant Shares</U>&rdquo;). <FONT STYLE="background-color: white">As
noted in the Prospectus, for each Pre-Funded Unit sold, the number of Units sold will be decreased on a one-for-one basis.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.45in"><FONT STYLE="background-color: white">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.45in">In connection with this opinion, I have
examined originals or copies, certified or otherwise identified to our satisfaction, of (i) the Registration Statement, including
the form of prospectus included therein and the documents incorporated by reference therein, (ii) the Company&rsquo;s certificate
of incorporation, as amended to date, (iii) the Company&rsquo;s by-laws, as amended to date, and (iv) certain resolutions of the
Board of Directors of the Company. I have also examined originals or copies, certified or otherwise identified to our satisfaction,
of such other documents, certificates and records as I have deemed necessary or appropriate, and I have made such investigations
of law as I have deemed appropriate as a basis for the opinions expressed below.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.45in">In rendering the opinions
expressed below, I have assumed and have not verified (i) the genuineness of the signatures on all documents that I have examined,
(ii) the legal capacity of all natural persons, (iii) the authenticity of all documents supplied to us as originals and (iv) the
conformity to the authentic originals of all documents supplied to us as certified or photostatic or faxed copies.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.45in">Based upon and subject to the foregoing
and subject also to the limitations, qualifications, exceptions and assumptions set forth herein, I am of the opinion that:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.05in; text-align: justify; text-indent: 0.45in">1.&nbsp;&nbsp;&nbsp;the
Securities have been duly authorized for issuance and, when issued, delivered and paid for in accordance with the terms of the
Engagement Agreement, will be validly issued, fully paid and nonassessable;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.05in; text-align: justify; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.05in; text-align: justify; text-indent: 0.45in">2.&nbsp;&nbsp;
the Warrants and Pre-Funded Warrants have been duly authorized for issuance, and, when issued, delivered and paid for in accordance
with the terms of the Engagement Agreement, will be validly issued and will constitute the legal, valid and binding obligation
of the Company, enforceable against the Company in accordance with its terms, except as the same may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors&rsquo; rights generally and equitable
principles of general applicability;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.05in; text-align: justify; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.05in; text-align: justify; text-indent: 0.45in">3.&nbsp;&nbsp;
the Warrant Shares and Pre-Funded Warrant Shares have been duly authorized, and when issued and sold by the Company and delivered
by the Company against receipt of the exercise price therefor, in accordance with and in the manner described in the Registration
Statement and Warrants, will be validly issued, fully paid and non-assessable;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.05in; text-align: justify; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.05in; text-indent: 0.45in">4.&nbsp;&nbsp;&nbsp;the Placement
Agent&rsquo;s Warrant, when executed and delivered by the Company in accordance with and in the manner described in the Registration
Statement and the Engagement Agreement, will be validly issued and will constitute a valid and binding agreement of the Company,
enforceable against the Company in accordance with its terms, except as the same may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of creditors&rsquo; rights generally and equitable principles
of general applicability; and</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.05in; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.05in; text-indent: 0.45in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">September 29, 2017<BR>
Page 2</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.45in">5.&nbsp;&nbsp; the Placement Agent&rsquo;s
Warrant Shares, when issued and sold by the Company and delivered by the Company upon valid exercise thereof and against receipt
of the exercise price therefor, in accordance with and in the manner described in the Registration Statement and the Placement
Agent&rsquo;s Warrant, will be validly issued, folly paid and non-assessable.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.45in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.45in">I express no opinion other than as to the
federal laws of the United States of America, the laws of New York State, and the Nevada Corporation Law (Chapter 78 of the Nevada
Revised Statutes, as amended, and including the statutory provisions, all applicable provisions of the Nevada Constitution and
reported judicial decisions interpreting the forgoing). I hereby consent to the filing of this opinion as an exhibit to the Registration
Statement and the reference to this firm under the caption &ldquo;Legal Matters&rdquo; in the prospectus included in the Registration
Statement. In giving this consent, I do not admit that I am an &ldquo;expert&rdquo; under the Securities Act or under the rules
and regulations of the Commission relating thereto with respect to any part of the Registration Statement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.45in">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 50%">&nbsp;</TD>
    <TD STYLE="width: 50%"><FONT STYLE="font-size: 10pt">Very truly yours,</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-size: 10pt">/s/ Jolie G. Kahn, Esq.</FONT></TD></TR>
</TABLE>


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<DOCUMENT>
<TYPE>EX-10.84
<SEQUENCE>3
<FILENAME>aethlon_ex1084.htm
<DESCRIPTION>SECURITIES PURCHASE AGREEMENT
<TEXT>
<HTML>
<HEAD>
     <TITLE></TITLE>
</HEAD>
<BODY STYLE="font: 10pt Times New Roman, Times, Serif">

<P STYLE="margin: 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-transform: uppercase; text-align: right; text-indent: -0.5in"><B>Exhibit
10.84</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-transform: uppercase; text-align: center; text-indent: -0.5in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-transform: uppercase; text-align: center; text-indent: -0.5in"><B>SECURITIES
PURCHASE AGREEMENT</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-transform: uppercase; text-align: center; text-indent: -0.5in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">This Securities Purchase
Agreement (this &ldquo;<U>Agreement</U>&rdquo;) is dated as of September ___, 2017, between Aethlon Medical, Inc., a Nevada corporation
(the &ldquo;<U>Company</U>&rdquo;), and each purchaser identified on the signature pages hereto (each, including its successors
and assigns, a &ldquo;<U>Purchaser</U>&rdquo; and collectively the &ldquo;<U>Purchasers</U>&rdquo;).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">WHEREAS, subject to
the terms and conditions set forth in this Agreement and pursuant to an effective registration statement under the Securities
Act of 1933, as amended (the &ldquo;<U>Securities Act</U>&rdquo;), the Company desires to issue and sell to each Purchaser, and
each Purchaser, severally and not jointly, desires to purchase from the Company, securities of the Company as more fully described
in this Agreement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">NOW, THEREFORE, IN
CONSIDERATION of the mutual covenants contained in this Agreement, and for other good and valuable consideration the receipt and
adequacy of which are hereby acknowledged, the Company and each Purchaser agree as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0in"><B>ARTICLE I.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0in"><BR>
DEFINITIONS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">1.1<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT> <U>Definitions</U>. In addition to the terms defined elsewhere in this Agreement, for all purposes of this Agreement, the
following terms have the meanings set forth in this Section 1.1:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">&ldquo;<U>Acquiring
Person</U>&rdquo; shall have the meaning ascribed to such term in Section 4.5.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Action</U>&rdquo;
shall have the meaning ascribed to such term in Section 3.1(j).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Affiliate</U>&rdquo;
means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common
control with a Person as such terms are used in and construed under Rule 405 under the Securities Act.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Board
of Directors</U>&rdquo; means the board of directors of the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Business
Day</U>&rdquo; means any day except any Saturday, any Sunday, any day which is a federal legal holiday in the United States or
any day on which banking institutions in the State of New York are authorized or required by law or other governmental action
to close.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Class
A Warrants</U>&rdquo; means, collectively, the Common Stock purchase warrants delivered to the Purchasers at the Closing in accordance
with Section 2.2(a) hereof, which Warrants shall be exercisable immediately and have a term of exercise equal to five (5) years,
in the form of <U>Exhibit A</U> attached hereto.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Class
B Warrants</U>&rdquo; means, collectively, the Common Stock purchase warrants delivered to the Purchasers at the Closing in accordance
with Section 2.2(a) hereof, which Warrants shall be exercisable immediately, in the form of <U>Exhibit B</U> attached hereto.</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Closing</U>&rdquo;
means the closing of the purchase and sale of the Securities pursuant to Section 2.1.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Closing
Date</U>&rdquo; means the Trading Day on which all of the Transaction Documents have been executed and delivered by the applicable
parties thereto, and all conditions precedent to (i) the Purchasers&rsquo; obligations to pay the Subscription Amount and (ii)
the Company&rsquo;s obligations to deliver the Securities, in each case, have been satisfied or waived, but in no event later
than the second (2<SUP>nd</SUP>) Trading Day following the date hereof.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Commission</U>&rdquo;
means the United States Securities and Exchange Commission.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Common
Stock</U>&rdquo; means the common stock of the Company, par value $0.001 per share, and any other class of securities into which
such securities may hereafter be reclassified or changed.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Common
Stock Equivalents</U>&rdquo; means any securities of the Company or the Subsidiaries which would entitle the holder thereof to
acquire at any time 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,
Common Stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Company
Counsel</U>&rdquo; means Jolie Kahn, Esq., with offices located at 33 Edgewood, Locust Valley, NY 11560.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>EGS</U>&rdquo;
means Ellenoff Grossman &amp; Schole LLP, with offices located at 1345 Avenue of the Americas, New York, New York 10105-0302.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Evaluation
Date</U>&rdquo; shall have the meaning ascribed to such term in Section 3.1(s).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Exchange
Act</U>&rdquo; means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Exempt
Issuance</U>&rdquo; means the issuance of (a) shares of Common Stock 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 other
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 pursuant to acquisitions
or strategic transactions approved by a majority of the disinterested directors of the Company, provided that such securities
are issued as &ldquo;restricted securities&rdquo; (as defined in Rule 144) and carry no registration rights that require or permit
the filing of any registration statement in connection therewith during the prohibition period in Section 4.12(a) herein, and
provided that any such issuance shall only be to a Person (or to the equityholders of a Person) which is, itself or through its
subsidiaries, an operating company or an owner of an asset in a business synergistic with the business of the Company and shall
provide to the Company additional benefits in addition to the investment of funds, but shall not include a transaction in which
the Company is issuing securities primarily for the purpose of raising capital or to an entity whose primary business is investing
in securities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>FCPA</U>&rdquo;
means the Foreign Corrupt Practices Act of 1977, as amended.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>FDA</U>&rdquo;
shall have the meaning ascribed to such term in Section 3.1(hh).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>FDCA</U>&rdquo;
shall have the meaning ascribed to such term in Section 3.1(hh).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>GAAP</U>&rdquo;
shall have the meaning ascribed to such term in Section 3.1(h).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Indebtedness</U>&rdquo;
shall have the meaning ascribed to such term in Section 3.1(aa).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Intellectual
Property Rights</U>&rdquo; shall have the meaning ascribed to such term in Section 3.1(p).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Liens</U>&rdquo;
means a lien, charge, pledge, security interest, encumbrance, right of first refusal, preemptive right or other restriction.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Material
Adverse Effect</U>&rdquo; shall have the meaning assigned to such term in Section 3.1(b).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Material
Permits</U>&rdquo; shall have the meaning ascribed to such term in Section 3.1(n).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

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    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Per
Share Purchase Price</U>&rdquo; equals $_______, subject to adjustment for reverse and forward stock splits, stock dividends,
stock combinations and other similar transactions of the Common Stock that occur after the date of this Agreement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Person</U>&rdquo;
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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Pharmaceutical
Product</U>&rdquo; shall have the meaning ascribed to such term in Section 3.1(hh).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Placement
Agent</U>&rdquo; means H.C. Wainwright &amp; Co., LLC.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Proceeding</U>&rdquo;
means an action, claim, suit, investigation or proceeding (including, without limitation, an informal investigation or partial
proceeding, such as a deposition), whether commenced or threatened.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Prospectus</U>&rdquo;
means the final prospectus filed for the Registration Statement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Prospectus
Supplement</U>&rdquo; means the supplement to the Prospectus complying with Rule 424(b) of the Securities Act that is filed with
the Commission and delivered by the Company to each Purchaser at the Closing.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Purchaser
Party</U>&rdquo; shall have the meaning ascribed to such term in Section 4.8.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Registration
Statement</U>&rdquo; means the effective registration statement with Commission file No. 333-219589 which registers the sale of
the Shares, the Warrants and the Warrant Shares to the Purchasers.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Required
Approvals</U>&rdquo; shall have the meaning ascribed to such term in Section 3.1(e).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Rule
144</U>&rdquo; means Rule 144 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted
from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose
and effect as such Rule.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Rule
424</U>&rdquo; means Rule 424 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted
from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose
and effect as such Rule.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>SEC
Reports</U>&rdquo; shall have the meaning ascribed to such term in Section 3.1(h).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Securities</U>&rdquo;
means the Shares, the Warrants and the Warrant Shares.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Securities
Act</U>&rdquo; means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Shares</U>&rdquo;
means the shares of Common Stock issued or issuable to each Purchaser pursuant to this Agreement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Short
Sales</U>&rdquo; means all &ldquo;short sales&rdquo; as defined in Rule 200 of Regulation SHO under the Exchange Act (but shall
not be deemed to include locating and/or borrowing shares of Common Stock).&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Subscription
Amount</U>&rdquo; means, as to each Purchaser, the aggregate amount to be paid for Shares and Warrants purchased hereunder as
specified below such Purchaser&rsquo;s name on the signature page of this Agreement and next to the heading &ldquo;Subscription
Amount,&rdquo; in United States dollars and in immediately available funds.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Subsidiary</U>&rdquo;
means any subsidiary of the Company and shall, where applicable, also include any direct or indirect subsidiary of the Company
formed or acquired after the date hereof.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Trading
Day</U>&rdquo; means a day on which the principal Trading Market is open for trading.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Trading
Market</U>&rdquo; means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on
the date in question: the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market
or the New York Stock Exchange (or any successors to any of the foregoing).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Transaction
Documents</U>&rdquo; means this Agreement, the Warrants, all exhibits and schedules thereto and hereto and any other documents
or agreements executed in connection with the transactions contemplated hereunder.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Transfer
Agent</U>&rdquo; means Computershare Investor Services, the current transfer agent of the Company, with a mailing address of 350
Indiana Street, Suite 800, Golden, Colorado 80401 and a facsimile number of _______________, and any successor transfer agent
of the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Variable
Rate Transaction</U>&rdquo; shall have the meaning ascribed to such term in Section 4.12(b).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Warrants</U>&rdquo;
means, collectively, the Class A Warrants and the Class B Warrants.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Warrant
Shares</U>&rdquo; means the shares of Common Stock issuable upon exercise of the Warrants.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0in"><B>ARTICLE II.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0in"><BR>
PURCHASE AND SALE</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">2.1<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Closing</U>. On the Closing Date, upon the terms and subject to the conditions set forth herein, substantially concurrent
with the execution and delivery of this Agreement by the parties hereto, the Company agrees to sell, and the Purchasers, severally
and not jointly, agree to purchase, up to an aggregate of up to $_____ million of Shares (or Class B Warrants) and Class A Warrants
as calculated pursuant to Section 2.2(a).&nbsp; Notwithstanding anything herein to the contrary, to the extent that a Purchaser
determines, in its sole discretion, that such Purchaser&rsquo;s Subscription Amount (together with such Purchaser&rsquo;s Affiliates
and any Person acting as a group together with such Purchaser or any of such Purchaser&rsquo;s Affiliates) would cause such Purchaser&rsquo;s
beneficial ownership of the shares of Common Stock to exceed 4.99% (or, at the election of the Purchaser, 9.99%) of the outstanding
shares of Common Stock, such Purchaser may elect to purchase Class B Warrants in lieu of the Shares as determined pursuant to
Section 2.2(a); provided, however, that, in the event that a Purchaser&rsquo;s Subscription Amount (together with such Purchaser&rsquo;s
Affiliates and any Person acting as a group together with such Purchaser or any of such Purchaser&rsquo;s Affiliates) would cause
such Purchaser&rsquo;s beneficial ownership of the shares of Common Stock to exceed 19.99% of the outstanding shares of Common
Stock, in lieu of shares of Common Stock in excess of such amount, such Purchaser may be entitled to purchase Class B Warrants
as determined pursuant to Section 2.2(a).&nbsp; In each case, it appears that the election to receive pre-funded warrants is solely
at the option of the Purchaser. Each Purchaser&rsquo;s Subscription Amount as set forth on the signature page hereto executed
by such Purchaser shall be made available for &ldquo;Delivery Versus Payment&rdquo; settlement with the Company. The Company shall
deliver to each Purchaser its respective Shares (or Class B Warrants) and Class A Warrants as determined pursuant to Section 2.2(a),
and the Company and each Purchaser shall deliver the other items set forth in Section 2.2 deliverable at the Closing.&nbsp; Upon
satisfaction of the covenants and conditions set forth in Sections 2.2 and 2.3, the Closing shall occur at the offices of the
Placement Agent or such other location as the parties shall mutually agree.&nbsp; Unless otherwise directed by the Placement Agent,
settlement of the Shares shall occur via &ldquo;Delivery Versus Payment&rdquo; (&ldquo;<U>DVP</U>&rdquo;)<I>&nbsp;</I>(i.e., on
the Closing Date, the Company shall issue the Shares registered in the Purchasers&rsquo; names and addresses and released by the
Transfer Agent directly to the account(s) at the Placement Agent identified by each Purchaser; upon receipt of such Shares, the
Placement Agent shall promptly electronically deliver such Shares and deliver the Warrants in physical form to the applicable
Purchaser, and payment therefor shall be made by the Placement Agent (or its clearing firm) by wire transfer to the Company).
The Company covenants that, if the Purchaser delivers a Notice of Exercise (as defined in the Class B Warrants) on or prior to
12:00 p.m. (New York City time) on the Closing Date to exercise any Class B Warrants, the Company shall deliver shares of Common
Stock with respect to the Class B Warrants to the Purchaser by 4:00 p.m. on the Closing Date in connection with such Notice of
Exercise.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">2.2<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Deliveries</U>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(a)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT>On or prior to the Closing Date, the Company shall deliver or cause to be delivered to each Purchaser the following:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">(i)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT>this Agreement duly executed by the Company;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">(ii)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT>a legal opinion of Company Counsel, acceptable to the Placement Agent;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">(iii)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT>subject to the last sentence of Section 2.1, the Company shall have provided each Purchaser with the Company&rsquo;s wire
instructions, on Company letterhead and executed by the Chief Executive Officer or Chief Financial Officer;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">(iv)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT>subject to the last sentence of Section 2.1, a copy of the irrevocable instructions to the Transfer Agent instructing the
Transfer Agent to deliver on an expedited basis via The Depository Trust Company Deposit or Withdrawal at Custodian system (&ldquo;<U>DWAC</U>&rdquo;)
Shares equal to such Purchaser&rsquo;s Subscription Amount divided by the Per Share Purchase Price, registered in the name of
such Purchaser;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">(v)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT>a Class A Warrant registered in the name of such Purchaser to purchase up to a number of shares of Common Stock equal to
___% of such Purchaser&rsquo;s Shares, with an exercise price equal to $_____, subject to adjustment therein;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">(vi)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT>if applicable, a Class B Warrant registered in the name of such Purchaser to purchase up to a number of shares of Common
Stock equal to the difference the difference between (A) such Purchaser&rsquo;s Subscription Amount divided by the Per Share Purchase
Price and (B) the number of Shares otherwise issuable to such Purchaser that would cause such Purchaser&rsquo;s Beneficial Ownership
to be more than 4.99%, 9.99% or 19.99%, as applicable, of the issued and outstanding shares of Common Stock, with an exercise
price of $0.01 per share, subject to adjustment therein; and</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">(vii)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT>the Prospectus and Prospectus Supplement (which may be delivered in accordance with Rule 172 under the Securities Act).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(b)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT>On or prior to the Closing Date, each Purchaser shall deliver or cause to be delivered to the Company the following:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">(i)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT>this Agreement duly executed by such Purchaser; and</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">(ii)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT>immediately available funds equal to such Purchaser&rsquo;s Subscription Amount (less, if applicable, the aggregate exercise
price of the Class B Warrants issuable to such Purchaser hereunder), which shall be made available for &ldquo;Delivery Versus
Payment&rdquo; settlement with the Company and, as to the Class B Warrants, will be wired to the account designed by the Company
in writing.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">2.3<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Closing Conditions</U>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
obligations of the Company hereunder in connection with the Closing are subject to the following conditions being met:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">(i)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT>the accuracy in all material respects (or, to the extent representations or warranties are qualified by materiality or
Material Adverse Effect, in all respects) on the Closing Date of the representations and warranties of the Purchasers contained
herein (unless as of a specific date therein in which case they shall be accurate as of such date);</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">(ii)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT>all obligations, covenants and agreements of each Purchaser required to be performed at or prior to the Closing Date shall
have been performed; and</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">(iii)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT>the delivery by each Purchaser of the items set forth in Section 2.2(b) of this Agreement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(b)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT>The respective obligations of the Purchasers hereunder in connection with the Closing are subject to the following conditions
being met:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">(i)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT>the accuracy in all material respects (or, to the extent representations or warranties are qualified by materiality or
Material Adverse Effect, in all respects) when made and on the Closing Date of the representations and warranties of the Company
contained herein (unless as of a specific date therein in which case they shall be accurate as of such date);</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">(ii)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT>all obligations, covenants and agreements of the Company required to be performed at or prior to the Closing Date shall
have been performed;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">(iii)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT>the delivery by the Company of the items set forth in Section 2.2(a) of this Agreement;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">(iv)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT>there shall have been no Material Adverse Effect with respect to the Company since the date hereof; and</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">(v)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT>from the date hereof to the Closing Date, trading in the Common Stock shall not have been suspended by the Commission or
the Company&rsquo;s principal Trading Market, and, at any time prior to the Closing Date, trading in securities generally as reported
by Bloomberg L.P. shall not have been suspended or limited, or minimum prices shall not have been established on securities whose
trades are reported by such service, or on any Trading Market, nor shall a banking moratorium have been declared either by the
United States or New York State authorities nor shall there have occurred any material outbreak or escalation of hostilities or
other national or international calamity of such magnitude in its effect on, or any material adverse change in, any financial
market which, in each case, in the reasonable judgment of such Purchaser, makes it impracticable or inadvisable to purchase the
Securities at the Closing.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">&nbsp;</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0in"><B>ARTICLE III.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0in"><BR>
REPRESENTATIONS AND WARRANTIES</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">3.1<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Representations and Warranties of the Company</U>. The Company hereby makes the following representations and warranties
to each Purchaser:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(a)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Subsidiaries</U>. All of the direct and indirect subsidiaries of the Company are set forth in the SEC Reports. The Company
owns, directly or indirectly, all of the capital stock or other equity interests of each Subsidiary free and clear of any Liens,
and all of the issued and outstanding shares of capital stock of each Subsidiary are validly issued and are fully paid, non-assessable
and free of preemptive and similar rights to subscribe for or purchase securities. If the Company has no subsidiaries, all other
references to the Subsidiaries or any of them in the Transaction Documents shall be disregarded.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(b)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Organization and Qualification</U>. The Company and each of the Subsidiaries is an entity duly incorporated or otherwise
organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization, with
the requisite power and authority to own and use its properties and assets and to carry on its business as currently conducted.
Neither the Company nor any Subsidiary is in violation nor default of any of the provisions of its respective certificate or articles
of incorporation, bylaws or other organizational or charter documents. Each of the Company and the Subsidiaries is duly qualified
to conduct business and is in good standing as a foreign corporation or other entity in each jurisdiction in which the nature
of the business conducted or property owned by it makes such qualification necessary, except where the failure to be so qualified
or in good standing, as the case may be, could not have or reasonably be expected to result in: (i) a material adverse effect
on the legality, validity or enforceability of any Transaction Document, (ii) a material adverse effect on the results of operations,
assets, business, prospects or condition (financial or otherwise) of the Company and the Subsidiaries, taken as a whole, or (iii)
a material adverse effect on the Company&rsquo;s ability to perform in any material respect on a timely basis its obligations
under any Transaction Document (any of (i), (ii) or (iii), a &ldquo;<U>Material Adverse Effect</U>&rdquo;) and no Proceeding has
been instituted in any such jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or curtail such power and
authority or qualification.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(c)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Authorization; Enforcement</U>. The Company has the requisite corporate power and authority to enter into and to consummate
the transactions contemplated by this Agreement and each of the other Transaction Documents and otherwise to carry out its obligations
hereunder and thereunder. The execution and delivery of this Agreement and each of the other Transaction Documents by the Company
and the consummation by it of the transactions contemplated hereby and thereby have been duly authorized by all necessary action
on the part of the Company and no further action is required by the Company, the Board of Directors or the Company&rsquo;s stockholders
in connection herewith or therewith other than in connection with the Required Approvals. This Agreement and each other Transaction
Document to which it is a party has been (or upon delivery will have been) duly executed by the Company and, when delivered in
accordance with the terms hereof and thereof, 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&rsquo; 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(d)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>No Conflicts</U>. The execution, delivery and performance by the Company of this Agreement and the other Transaction
Documents to which it is a party, the issuance and sale of the Securities and the consummation by it of the transactions contemplated
hereby and thereby do not and will not (i) conflict with or violate any provision of the Company&rsquo;s or any Subsidiary&rsquo;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
Lien upon any of the properties or assets of the Company or any Subsidiary, or give to others any rights of termination, amendment,
acceleration or cancellation (with or without notice, lapse of time or both) of, any agreement, credit facility, debt or other
instrument (evidencing a Company or Subsidiary debt or otherwise) or other understanding to which the Company or any Subsidiary
is a party or by which any property or asset of the Company or any Subsidiary is bound or affected, or (iii) subject to the Required
Approvals, 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 or a Subsidiary is subject (including federal and state securities
laws and regulations), or by which any property or asset of the Company or a Subsidiary 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(e)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Filings, Consents and Approvals</U>. 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 the Transaction Documents,
other than: (i) the filings required pursuant to Section 4.4 of this Agreement, (ii) the filing with the Commission of the Prospectus
Supplement, (iii) application(s) to each applicable Trading Market for the listing of the Shares and Warrant Shares for trading
thereon in the time and manner required thereby, and (iv) such filings as are required to be made under applicable state securities
laws (collectively, the &ldquo;<U>Required Approvals</U>&rdquo;).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(f)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Issuance of the Securities; Registration</U>. The Securities are duly authorized and, when issued and paid for in accordance
with the applicable Transaction Documents, will be duly and validly issued, fully paid and nonassessable, free and clear of all
Liens imposed by the Company. The Warrant Shares, when issued in accordance with the terms of the Warrants, will be validly issued,
fully paid and nonassessable, free and clear of all Liens imposed by the Company. The Company has reserved from its duly authorized
capital stock the maximum number of shares of Common Stock issuable pursuant to this Agreement and the Warrants. The Company has
prepared and filed the Registration Statement in conformity with the requirements of the Securities Act, which became effective
on&nbsp;_____________ (the &ldquo;<U>Effective Date</U>&rdquo;), including the Prospectus, and such amendments and supplements
thereto as may have been required to the date of this Agreement. The Registration Statement is effective under the Securities
Act and no stop order preventing or suspending the effectiveness of the Registration Statement or suspending or preventing the
use of the Prospectus has been issued by the Commission and no proceedings for that purpose have been instituted or, to the knowledge
of the Company, are threatened by the Commission. The Company, if required by the rules and regulations of the Commission, shall
file the Prospectus with the Commission pursuant to Rule 424(b). At the time the Registration Statement and any amendments thereto
became effective, at the date of this Agreement and at the Closing Date, the Registration Statement and any amendments thereto
conformed and will conform in all material respects to the requirements of the Securities Act and did not and will not contain
any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make
the statements therein not misleading; and the Prospectus and any amendments or supplements thereto, at time the Prospectus or
any amendment or supplement thereto was issued and at the Closing Date, conformed and will conform in all material respects to
the requirements of the Securities Act and did not and will not contain an untrue statement of a material fact or omit to state
a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made,
not misleading.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(g)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Capitalization</U>. The capitalization of the Company is as set forth in the SEC Reports. The Company has not issued
any capital stock since its most recently filed periodic report under the Exchange Act, other than pursuant to the exercise of
employee stock options under the Company&rsquo;s stock option plans, the issuance of shares of Common Stock to employees pursuant
to the Company&rsquo;s employee stock purchase plans and pursuant to the conversion and/or exercise of Common Stock Equivalents
outstanding as of the date of the most recently filed periodic report under the Exchange Act. No Person has any right of first
refusal, preemptive right, right of participation, or any similar right to participate in the transactions contemplated by the
Transaction Documents. Except as a result of the purchase and sale of the Securities, there are no outstanding options, warrants,
scrip rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities, rights or obligations
convertible into or exercisable or exchangeable for, or giving any Person any right to subscribe for or acquire, any shares of
Common Stock or the capital stock of any Subsidiary, or contracts, commitments, understandings or arrangements by which the Company
or any Subsidiary is or may become bound to issue additional shares of Common Stock or Common Stock Equivalents or capital stock
of any Subsidiary. The issuance and sale of the Securities will not obligate the Company or any Subsidiary to issue shares of
Common Stock or other securities to any Person (other than the Purchasers) and will not result in a right of any holder of Company
securities to adjust the exercise, conversion, exchange or reset price under any of such securities. There are no outstanding
securities or instruments of the Company or any Subsidiary that contain any redemption or similar provisions, and there are no
contracts, commitments, understandings or arrangements by which the Company or any Subsidiary is or may become bound to redeem
a security of the Company or such Subsidiary. The Company does not have any stock appreciation rights or &ldquo;phantom stock&rdquo;
plans or agreements or any similar plan or agreement. All of the outstanding shares of capital stock of the Company are duly authorized,
validly issued, fully paid and nonassessable, have been issued in compliance with all federal and state securities laws, and none
of such outstanding shares was issued in violation of any preemptive rights or similar rights to subscribe for or purchase securities.
No further approval or authorization of any stockholder, the Board of Directors or others is required for the issuance and sale
of the Securities. There are no stockholders agreements, voting agreements or other similar agreements with respect to the Company&rsquo;s
capital stock to which the Company is a party or, to the knowledge of the Company, between or among any of the Company&rsquo;s
stockholders.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(h)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>SEC Reports; Financial Statements</U>. The Company has filed all reports, schedules, forms, statements and other documents
required to be filed by the Company under the Securities Act and 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,
together with the Prospectus and the Prospectus Supplement, being collectively referred to herein as the &ldquo;<U>SEC Reports</U>&rdquo;)
on a timely basis or has received a valid extension of such time of filing and has filed any such SEC Reports prior to the expiration
of any such extension. As of their respective dates, the SEC Reports complied in all material respects with the requirements of
the Securities Act and the Exchange Act, as applicable, 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. The Company has never been an issuer subject
to Rule 144(i) under the Securities Act. The financial statements of the Company included in the SEC Reports comply in all material
respects with applicable accounting requirements and the rules and regulations of the Commission with respect thereto as in effect
at the time of filing. Such financial statements have been prepared in accordance with United States generally accepted accounting
principles applied on a consistent basis during the periods involved (&ldquo;<U>GAAP</U>&rdquo;), except as may be otherwise specified
in such financial statements or the notes thereto and except that unaudited financial statements may not contain all footnotes
required by GAAP, and fairly present in all material respects the financial position of the Company and its consolidated Subsidiaries
as of and for the dates thereof and the results of operations and cash flows for the periods then ended, subject, in the case
of unaudited statements, to normal, immaterial, year-end audit adjustments.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(i)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Material Changes; Undisclosed Events, Liabilities or Developments</U>.&nbsp;Since the date of the latest audited financial
statements included within the SEC Reports, except as set forth <FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">in
the SEC Reports, (i) there has been no event, occurrence or development that has had or that could reasonably be expected to result
in a Material Adverse Effect, (ii) the Company has not incurred any liabilities (contingent or otherwise) other than (A) trade
payables and accrued expenses incurred in the ordinary course of business consistent with past practice and (B) liabilities not
required to be reflected in the Company&rsquo;s financial statements pursuant to GAAP or disclosed in filings made with the Commission,
(iii) the Company has not altered its method of accounting, (iv) the Company has not declared or made any dividend or distribution
of cash or other property to its stockholders or purchased, redeemed or made any agreements to purchase or redeem any shares of
its capital stock and (v) the Company has not issued any equity securities to any officer, director or Affiliate, except pursuant
to existing Company stock option plans. The Company does not have pending before the Commission any request for confidential treatment
of information. Except for the issuance of the Securities contemplated by this Agreement or as set forth in the SEC Reports, no
event, liability, fact, circumstance, occurrence or development has occurred or exists or is reasonably expected to occur or exist
with respect to the Company or its Subsidiaries or their respective businesses, prospects, properties, operations, assets or financial
condition that would be required to be disclosed by the Company under applicable securities laws at the time this representation
is made or deemed made that has not been publicly disclosed at least 1 Trading Day prior to the date that this representation
is made.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(j)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Litigation</U>. There is no action, suit, inquiry, notice of violation, proceeding or investigation pending or, to the
knowledge of the Company, threatened against or affecting the Company, any Subsidiary or any of their respective properties before
or by any court, arbitrator, governmental or administrative agency or regulatory authority (federal, state, county, local or foreign)
(collectively, an &ldquo;<U>Action</U>&rdquo;) which (i) adversely affects or challenges the legality, validity or enforceability
of any of the Transaction Documents or the Securities or (ii) could, if there were an unfavorable decision, have or reasonably
be expected to result in a Material Adverse Effect. Neither the Company nor any Subsidiary, nor any director or officer thereof,
is or has been the subject of any Action involving a claim of violation of or liability under federal or state securities laws
or a claim of breach of fiduciary duty. There has not been, and to the knowledge of the Company, there is not pending or contemplated,
any investigation by the Commission involving the Company or any current or former director or officer of the Company. The Commission
has not issued any stop order or other order suspending the effectiveness of any registration statement filed by the Company or
any Subsidiary under the Exchange Act or the Securities Act.</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(k)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Labor Relations</U>. No labor dispute exists or, to the knowledge of the Company, is imminent with respect to any of
the employees of the Company, which could reasonably be expected to result in a Material Adverse Effect. None of the Company&rsquo;s
or its Subsidiaries&rsquo; employees is a member of a union that relates to such employee&rsquo;s relationship with the Company
or such Subsidiary, and neither the Company nor any of its Subsidiaries is a party to a collective bargaining agreement, and the
Company and its Subsidiaries believe that their relationships with their employees are good. To the knowledge of the Company,
no executive officer of the Company or any Subsidiary, is, or is now expected to be, in violation of any material term of any
employment contract, confidentiality, disclosure or proprietary information agreement or non-competition agreement, or any other
contract or agreement or any restrictive covenant in favor of any third party, and the continued employment of each such executive
officer does not subject the Company or any of its Subsidiaries to any liability with respect to any of the foregoing matters.
The Company and its Subsidiaries are in compliance with all U.S. federal, state, local and foreign laws and regulations relating
to employment and employment practices, terms and conditions of employment and wages and hours, except where the failure to be
in compliance could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(l)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Compliance</U>. Neither the Company nor any Subsidiary: (i) is in default under or in violation of (and no event has
occurred that has not been waived that, with notice or lapse of time or both, would result in a default by the Company or any
Subsidiary under), nor has the Company or any Subsidiary received notice of a claim that it is in default under or that it is
in violation of, any indenture, loan or credit agreement or any other agreement or instrument to which it is a party or by which
it or any of its properties is bound (whether or not such default or violation has been waived), (ii) is in violation of any judgment,
decree or order of any court, arbitrator or other governmental authority or (iii) is or has been in violation of any statute,
rule, ordinance or regulation of any governmental authority, including without limitation all foreign, federal, state and local
laws relating to taxes, environmental protection, occupational health and safety, product quality and safety and employment and
labor matters, except in each case as could not have or reasonably be expected to result in a Material Adverse Effect.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(m)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Environmental Laws</U>.&#9;The Company and its Subsidiaries (i) are in compliance with all federal, state, local and
foreign laws relating to pollution or protection of human health or the environment (including ambient air, surface water, groundwater,
land surface or subsurface strata), including laws relating to emissions, discharges, releases or threatened releases of chemicals,
pollutants, contaminants, or toxic or hazardous substances or wastes (collectively, &ldquo;<U>Hazardous Materials</U>&rdquo;)
into the environment, or otherwise relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport
or handling of Hazardous Materials, as well as all authorizations, codes, decrees, demands, or demand letters, injunctions, judgments,
licenses, notices or notice letters, orders, permits, plans or regulations, issued, entered, promulgated or approved thereunder
(&ldquo;<U>Environmental Laws</U>&rdquo;); (ii) have received all permits licenses or other approvals required of them under applicable
Environmental Laws to conduct their respective businesses; and (iii) are in compliance with all terms and conditions of any such
permit, license or approval where in each clause (i), (ii) and (iii), the failure to so comply could be reasonably expected to
have, individually or in the aggregate, a Material Adverse Effect.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(n)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Regulatory Permits</U>. The Company and the Subsidiaries possess all certificates, authorizations and permits issued
by the appropriate federal, state, local or foreign regulatory authorities necessary to conduct their respective businesses as
described in the SEC Reports, except where the failure to possess such permits could not reasonably be expected to result in a
Material Adverse Effect (&ldquo;<U>Material Permits</U>&rdquo;), and neither the Company nor any Subsidiary has received any notice
of proceedings relating to the revocation or modification of any Material Permit.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(o)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Title to Assets</U>. The Company and the Subsidiaries have good and marketable title in fee simple to all real property
owned by them and good and marketable title in all personal property owned by them that is material to the business of the Company
and the Subsidiaries, in each case free and clear of all Liens, except for (i) Liens as do not materially affect the value of
such property and do not materially interfere with the use made and proposed to be made of such property by the Company and the
Subsidiaries and (ii) Liens for the payment of federal, state or other taxes, for which appropriate reserves have been made therefor
in accordance with GAAP and, the payment of which is neither delinquent nor subject to penalties. Any real property and facilities
held under lease by the Company and the Subsidiaries are held by them under valid, subsisting and enforceable leases with which
the Company and the Subsidiaries are in compliance.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(p)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Intellectual Property</U>. The Company and the Subsidiaries have, or have rights to use, all patents, patent applications,
trademarks, trademark applications, service marks, trade names, trade secrets, inventions, copyrights, licenses and other intellectual
property rights and similar rights necessary or required for use in connection with their respective businesses as described in
the SEC Reports and which the failure to so have could have a Material Adverse Effect (collectively, the &ldquo;<U>Intellectual
Property Rights</U>&rdquo;). None of, and neither the Company nor any Subsidiary has received a notice (written or otherwise)
that any of, the Intellectual Property Rights has expired, terminated or been abandoned, or is expected to expire or terminate
or be abandoned, within two (2) years from the date of this Agreement. Neither the Company nor any Subsidiary has received, since
the date of the latest audited financial statements included within the SEC Reports, a written notice of a claim or otherwise
has any knowledge that the Intellectual Property Rights violate or infringe upon the rights of any Person, except as could not
have or reasonably be expected to not have a Material Adverse Effect. To the knowledge of the Company, all such Intellectual Property
Rights are enforceable and there is no existing infringement by another Person of any of the Intellectual Property Rights. The
Company and its Subsidiaries have taken reasonable security measures to protect the secrecy, confidentiality and value of all
of their intellectual properties, except where failure to do so could not, individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(q)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Insurance</U>. The Company and the Subsidiaries are insured by insurers of recognized financial responsibility against
such losses and risks and in such amounts as are prudent and customary in the businesses in which the Company and the Subsidiaries
are engaged, including, but not limited to, directors and officers insurance coverage at least equal to the aggregate Subscription
Amount. Neither the Company nor any Subsidiary has any reason to believe that it will not be able to renew its existing insurance
coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue
its business without a significant increase in cost.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(r)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Transactions With Affiliates and Employees</U>. Except as set forth in the SEC Reports, none of the officers or directors
of the Company or any Subsidiary and, to the knowledge of the Company, none of the employees of the Company or any Subsidiary
is presently a party to any transaction with the Company or any Subsidiary (other than for services as employees, officers and
directors), including any contract, agreement or other arrangement providing for the furnishing of services to or by, providing
for rental of real or personal property to or from, providing for the borrowing of money from or lending of money to or otherwise
requiring payments to or from any officer, director or such employee or, to the knowledge of the Company, any entity in which
any officer, director, or any such employee has a substantial interest or is an officer, director, trustee, stockholder, member
or partner, in each case in excess of $120,000 other than for (i) payment of salary or consulting fees for services rendered,
(ii) reimbursement for expenses incurred on behalf of the Company and (iii) other employee benefits, including stock option agreements
under any stock option plan of the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(s)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Sarbanes-Oxley; Internal Accounting Controls</U>. The Company and the Subsidiaries are in compliance with any and all
applicable requirements of the Sarbanes-Oxley Act of 2002 that are effective as of the date hereof, and any and all applicable
rules and regulations promulgated by the Commission thereunder that are effective as of the date hereof and as of the Closing
Date. The Company and the Subsidiaries maintain a system of internal accounting controls sufficient to provide reasonable assurance
that: (i) transactions are executed in accordance with management&rsquo;s general or specific authorizations, (ii) transactions
are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain asset accountability,
(iii) access to assets is permitted only in accordance with management&rsquo;s general or specific authorization, and (iv) the
recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken
with respect to any differences. The Company and the Subsidiaries have established disclosure controls and procedures (as defined
in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Company and the Subsidiaries and designed such disclosure controls and
procedures to ensure that information required to be disclosed by the Company in the reports it files or submits under the Exchange
Act is recorded, processed, summarized and reported, within the time periods specified in the Commission&rsquo;s rules and forms.
The Company&rsquo;s certifying officers have evaluated the effectiveness of the disclosure controls and procedures of the Company
and the Subsidiaries as of the end of the period covered by the most recently filed periodic report under the Exchange Act (such
date, the &ldquo;<U>Evaluation Date</U>&rdquo;). The Company presented in its most recently filed periodic report under the Exchange
Act the conclusions of the certifying officers about the effectiveness of the disclosure controls and procedures based on their
evaluations as of the Evaluation Date. Since the Evaluation Date, there have been no changes in the internal control over financial
reporting (as such term is defined in the Exchange Act) of the Company and its Subsidiaries that have materially affected, or
is reasonably likely to materially affect, the internal control over financial reporting of the Company and its Subsidiaries.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(t)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Certain Fees</U>. Except as set forth in the Prospectus, no brokerage or finder&rsquo;s fees or commissions are or will
be payable by the Company or any Subsidiary to any broker, financial advisor or consultant, finder, placement agent, investment
banker, bank or other Person with respect to the transactions contemplated by the Transaction Documents. The Purchasers shall
have no obligation with respect to any fees or with respect to any claims made by or on behalf of other Persons for fees of a
type contemplated in this Section that may be due in connection with the transactions contemplated by the Transaction Documents.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(u)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Investment Company</U>. The Company is not, and is not an Affiliate of, and immediately after receipt of payment for
the Securities, will not be or be an Affiliate of, an &ldquo;investment company&rdquo; within the meaning of the Investment Company
Act of 1940, as amended. The Company shall conduct its business in a manner so that it will not become an &ldquo;investment company&rdquo;
subject to registration under the Investment Company Act of 1940, as amended.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(v)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Registration Rights</U>. No Person has any right to cause the Company or any Subsidiary to effect the registration under
the Securities Act of any securities of the Company or any Subsidiary.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(w)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Listing and Maintenance Requirements</U>. The Common Stock is registered pursuant to Section 12(b) or 12(g) of the Exchange
Act, and the Company has taken no action designed to, or which to its knowledge is likely to have the effect of, terminating the
registration of the Common Stock under the Exchange Act nor has the Company received any notification that the Commission is contemplating
terminating such registration. <FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Except as set forth in
the SEC Reports, the Company has not, in the 12 months preceding the date hereof, received notice from any Trading Market on which
the Common Stock is or has been listed or quoted to the effect that the Company is not in compliance with the listing or maintenance
requirements of such Trading Market. The Common Stock is currently eligible for electronic transfer through the Depository Trust
Company or another established clearing corporation and the Company is current in payment of the fees to the Depository Trust
Company (or such other established clearing corporation) in connection with such electronic transfer.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(x)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Application of Takeover Protections</U>. The Company and the Board of Directors have taken all necessary action, if
any, in order to render inapplicable any control share acquisition, business combination, poison pill (including any distribution
under a rights agreement) or other similar anti-takeover provision under the Company&rsquo;s certificate of incorporation (or
similar charter documents) or the laws of its state of incorporation that is or could become applicable to the Purchasers as a
result of the Purchasers and the Company fulfilling their obligations or exercising their rights under the Transaction Documents,
including without limitation as a result of the Company&rsquo;s issuance of the Securities and the Purchasers&rsquo; ownership
of the Securities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(y)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Disclosure</U>. Except with respect to the material terms and conditions of the transactions contemplated by the Transaction
Documents, the Company confirms that neither it nor any other Person acting on its behalf has provided any of the Purchasers or
their agents or counsel with any information that it believes constitutes or might constitute material, non-public information
which is not otherwise disclosed in the Prospectus. The Company understands and confirms that the Purchasers will rely on the
foregoing representation in effecting transactions in securities of the Company. All of the disclosure furnished by or on behalf
of the Company to the Purchasers regarding the Company and its Subsidiaries, their respective businesses and the transactions
contemplated hereby, including the Disclosure Schedules to this Agreement, is true and correct and does not contain any untrue
statement of a material fact or omit to state any material fact necessary in order to make the statements made therein, in the
light of the circumstances under which they were made, not misleading. The press releases disseminated by the Company during the
twelve months preceding the date of this Agreement taken as a whole do not contain any untrue statement of a material fact or
omit 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 and when made, not misleading. The Company acknowledges and agrees that no Purchaser
makes or has made any representations or warranties with respect to the transactions contemplated hereby other than those specifically
set forth in Section 3.2 hereof.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(z)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>No Integrated Offering</U>. Assuming the accuracy of the Purchasers&rsquo; representations and warranties set forth
in Section 3.2, neither the Company, nor any of its Affiliates, nor any Person acting on its or their behalf has, directly or
indirectly, made any offers or sales of any security or solicited any offers to buy any security, under circumstances that would
cause this offering of the Securities to be integrated with prior offerings by the Company for purposes of any applicable shareholder
approval provisions of any Trading Market on which any of the securities of the Company are listed or designated.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(aa)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Solvency</U>.&nbsp;Based on the consolidated financial condition of the Company as of the Closing Date, after giving
effect to the receipt by the Company of the proceeds from the sale of the Securities hereunder, (i) the fair saleable value of
the Company&rsquo;s assets exceeds the amount that will be required to be paid on or in respect of the Company&rsquo;s existing
debts and other liabilities (including known contingent liabilities) as they mature, (ii) the Company&rsquo;s assets do not constitute
unreasonably small capital to carry on its business as now conducted and as proposed to be conducted including its capital needs
taking into account the particular capital requirements of the business conducted by the Company, consolidated and projected capital
requirements and capital availability thereof, and (iii) the current cash flow of the Company, together with the proceeds the
Company would receive, were it to liquidate all of its assets, after taking into account all anticipated uses of the cash, would
be sufficient to pay all amounts on or in respect of its liabilities when such amounts are required to be paid. The Company does
not intend to incur debts beyond its ability to pay such debts as they mature (taking into account the timing and amounts of cash
to be payable on or in respect of its debt). The Company has no knowledge of any facts or circumstances which lead it to believe
that it will file for reorganization or liquidation under the bankruptcy or reorganization laws of any jurisdiction within one
year from the Closing Date. <FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The SEC Reports sets forth
as of the date hereof all outstanding secured and unsecured Indebtedness of the Company or any Subsidiary, or for which the Company
or any Subsidiary has commitments. For the purposes of this Agreement, &ldquo;<U>Indebtedness</U>&rdquo; means (x) any liabilities
for borrowed money or amounts owed in excess of $50,000 (other than trade accounts payable incurred in the ordinary course of
business), (y) all guaranties, endorsements and other contingent obligations in respect of indebtedness of others, whether or
not the same are or should be reflected in the Company&rsquo;s consolidated balance sheet (or the notes thereto), except guaranties
by endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business;
and (z) the present value of any lease payments in excess of $50,000 due under leases required to be capitalized in accordance
with GAAP. Neither the Company nor any Subsidiary is in default with respect to any Indebtedness.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(bb)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Tax Status</U>. Except for matters that would not, individually or in the aggregate, have or reasonably be expected
to result in a Material Adverse Effect, the Company and its Subsidiaries each (i) has made or filed all United States federal,
state and local income and all foreign income and franchise tax returns, reports and declarations required by any jurisdiction
to which it is subject, (ii) has paid all taxes and other governmental assessments and charges that are material in amount, shown
or determined to be due on such returns, reports and declarations and (iii) has set aside on its books provision reasonably adequate
for the payment of all material taxes for periods subsequent to the periods to which such returns, reports or declarations apply.
There are no unpaid taxes in any material amount claimed to be due by the taxing authority of any jurisdiction, and the officers
of the Company or of any Subsidiary know of no basis for any such claim.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(cc)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Foreign Corrupt Practices</U>. Neither the Company nor any Subsidiary, nor to the knowledge of the Company or any Subsidiary,
any agent or other person acting on behalf of the Company or any Subsidiary, has (i) directly or indirectly, used any funds for
unlawful contributions, gifts, entertainment or other unlawful expenses related to foreign or domestic political activity, (ii)
made any unlawful payment to foreign or domestic government officials or employees or to any foreign or domestic political parties
or campaigns from corporate funds, (iii) failed to disclose fully any contribution made by the Company or any Subsidiary (or made
by any person acting on its behalf of which the Company is aware) which is in violation of law, or (iv) violated in any material
respect any provision of FCPA.</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(dd)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Accountants</U>.&nbsp;The Company&rsquo;s accounting firm is <FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">_________________.
To the knowledge and belief of the Company, such accounting firm (i) is a registered public accounting firm as required by the
Exchange Act and (ii) shall express its opinion with respect to the financial statements to be included in the Company&rsquo;s
Annual Report for the fiscal year ending March 31, 2018.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(ee)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT> <U>Acknowledgment Regarding Purchasers&rsquo; Purchase of Securities</U>. The Company acknowledges and agrees that each
of the Purchasers is acting solely in the capacity of an arm&rsquo;s length purchaser with respect to the Transaction Documents
and the transactions contemplated thereby. The Company further acknowledges that no Purchaser is acting as a financial advisor
or fiduciary of the Company (or in any similar capacity) with respect to the Transaction Documents and the transactions contemplated
thereby and any advice given by any Purchaser or any of their respective representatives or agents in connection with the Transaction
Documents and the transactions contemplated thereby is merely incidental to the Purchasers&rsquo; purchase of the Securities.
The Company further represents to each Purchaser that the Company&rsquo;s decision to enter into this Agreement and the other
Transaction Documents has been based solely on the independent evaluation of the transactions contemplated hereby by the Company
and its representatives.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(ff)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><FONT STYLE="color: Black"><U>Acknowledgment Regarding Purchaser&rsquo;s Trading Activit</U>y. Anything in this Agreement
or elsewhere herein to the contrary notwithstanding (except for Sections 3.2(f) and 4.14 hereof), it is understood and acknowledged
by the Company that: (i) none of the Purchasers has been asked by the Company to agree, nor has any Purchaser agreed, to desist
from purchasing or selling, long and/or short, securities of the Company, or &ldquo;derivative&rdquo; securities based on securities
issued by the Company or to hold the Securities for any specified term; (ii) past or future open market or other transactions
by any Purchaser, specifically including, without limitation, Short Sales or &ldquo;derivative&rdquo; transactions, before or
after the closing of this or future private placement transactions, may negatively impact the market price of the Company&rsquo;s
publicly-traded securities; (iii) any Purchaser, and counter-parties in &ldquo;derivative&rdquo; transactions to which any such
Purchaser is a party, directly or indirectly, presently may have a &ldquo;short&rdquo; position in the Common Stock, and (iv)
each Purchaser shall not be deemed to have any affiliation with or control over any arm&rsquo;s length counter-party in any &ldquo;derivative&rdquo;
transaction. T</FONT>he Company further understands and acknowledges that (y) one or more Purchasers may engage in hedging activities
at various times during the period that the Securities are outstanding, including, without limitation, during the periods that
the value of the Warrant Shares deliverable with respect to Securities are being determined, and (z) such hedging activities (if
any) could reduce the value of the existing stockholders' equity interests in the Company at and after the time that the hedging
activities are being conducted.&nbsp; The Company acknowledges that such aforementioned hedging activities do not constitute a
breach of any of the Transaction Documents.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(gg)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Regulation M Compliance</U>. The Company has not, and to its knowledge no one acting on its behalf has, (i) taken, directly
or indirectly, any action designed to cause or to result in the stabilization or manipulation of the price of any security of
the Company to facilitate the sale or resale of any of the Securities, (ii) sold, bid for, purchased, or, paid any compensation
for soliciting purchases of, any of the Securities, or (iii) paid or agreed to pay to any Person any compensation for soliciting
another to purchase any other securities of the Company, other than, in the case of clauses (ii) and (iii), compensation paid
to the Company&rsquo;s placement agent in connection with the placement of the Securities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(hh)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>FDA</U>. As to each product subject to the jurisdiction of the U.S. Food and Drug Administration (&ldquo;<U>FDA</U>&rdquo;)
under the Federal Food, Drug and Cosmetic Act, as amended, and the regulations thereunder (&ldquo;<U>FDCA</U>&rdquo;) that is
manufactured, packaged, labeled, tested, distributed, sold, and/or marketed by the Company or any of its Subsidiaries (each such
product, a &ldquo;<U>Pharmaceutical Product</U>&rdquo;), such Pharmaceutical Product is being manufactured, packaged, labeled,
tested, distributed, sold and/or marketed by the Company in compliance with all applicable requirements under FDCA and similar
laws, rules and regulations relating to registration, investigational use, premarket clearance, licensure, or application approval,
good manufacturing practices, good laboratory practices, good clinical practices, product listing, quotas, labeling, advertising,
record keeping and filing of reports, except where the failure to be in compliance would not have a Material Adverse Effect. There
is no pending, completed or, to the Company's knowledge, threatened, action (including any lawsuit, arbitration, or legal or administrative
or regulatory proceeding, charge, complaint, or investigation) against the Company or any of its Subsidiaries, and none of the
Company or any of its Subsidiaries has received any notice, warning letter or other communication from the FDA or any other governmental
entity, which (i) contests the premarket clearance, licensure, registration, or approval of, the uses of, the distribution of,
the manufacturing or packaging of, the testing of, the sale of, or the labeling and promotion of any Pharmaceutical Product, (ii)
withdraws its approval of, requests the recall, suspension, or seizure of, or withdraws or orders the withdrawal of advertising
or sales promotional materials relating to, any Pharmaceutical Product, (iii) imposes a clinical hold on any clinical investigation
by the Company or any of its Subsidiaries, (iv) enjoins production at any facility of the Company or any of its Subsidiaries,
(v) enters or proposes to enter into a consent decree of permanent injunction with the Company or any of its Subsidiaries, or
(vi) otherwise alleges any violation of any laws, rules or regulations by the Company or any of its Subsidiaries, and which, either
individually or in the aggregate, would have a Material Adverse Effect. The properties, business and operations of the Company
have been and are being conducted in all material respects in accordance with all applicable laws, rules and regulations of the
FDA. The Company has not been informed by the FDA that the FDA will prohibit the marketing, sale, license or use in the United
States of any product proposed to be developed, produced or marketed by the Company nor has the FDA expressed any concern as to
approving or clearing for marketing any product being developed or proposed to be developed by the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(ii)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Stock Option Plans</U>. Each stock option granted by the Company under the Company&rsquo;s stock option plan was granted
(i) in accordance with the terms of the Company&rsquo;s stock option plan and (ii) with an exercise price at least equal to the
fair market value of the Common Stock on the date such stock option would be considered granted under GAAP and applicable law.
No stock option granted under the Company&rsquo;s stock option plan has been backdated. The Company has not knowingly granted,
and there is no and has been no Company policy or practice to knowingly grant, stock options prior to, or otherwise knowingly
coordinate the grant of stock options with, the release or other public announcement of material information regarding the Company
or its Subsidiaries or their financial results or prospects.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(jj)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Office of Foreign Assets Control</U>. Neither the Company nor any Subsidiary nor, to the Company's knowledge, any director,
officer, agent, employee or affiliate of the Company or any Subsidiary is currently subject to any U.S. sanctions administered
by the Office of Foreign Assets Control of the U.S. Treasury Department (&ldquo;<U>OFAC</U>&rdquo;).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(kk)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>U.S. Real Property Holding Corporation</U>. The Company is not and has never been a U.S. real property holding corporation
within the meaning of Section 897 of the Internal Revenue Code of 1986, as amended, and the Company shall so certify upon Purchaser&rsquo;s
request.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(ll)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Bank Holding Company Act</U>. Neither the Company nor any of its Subsidiaries or Affiliates is subject to the Bank Holding
Company Act of 1956, as amended (the &ldquo;<U>BHCA</U>&rdquo;) and to regulation by the Board of Governors of the Federal Reserve
System (the &ldquo;<U>Federal Reserve</U>&rdquo;). Neither the Company nor any of its Subsidiaries or Affiliates owns or controls,
directly or indirectly, five percent (5%) or more of the outstanding shares of any class of voting securities or twenty-five percent
or more of the total equity of a bank or any entity that is subject to the BHCA and to regulation by the Federal Reserve. Neither
the Company nor any of its Subsidiaries or Affiliates exercises a controlling influence over the management or policies of a bank
or any entity that is subject to the BHCA and to regulation by the Federal Reserve.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(mm)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Money Laundering</U>. The operations of the Company and its Subsidiaries are and have been conducted at all times in
compliance with applicable financial record-keeping and reporting requirements of the Currency and Foreign Transactions Reporting
Act of 1970, as amended, applicable money laundering statutes and applicable rules and regulations thereunder (collectively, the
&ldquo;<U>Money Laundering Laws</U>&rdquo;), and no Action or Proceeding by or before any court or governmental agency, authority
or body or any arbitrator involving the Company or any Subsidiary with respect to the Money Laundering Laws is pending or, to
the knowledge of the Company or any Subsidiary, threatened.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">3.2<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Representations and Warranties of the Purchasers</U>. Each Purchaser, for itself and for no other Purchaser, hereby
represents and warrants as of the date hereof and as of the Closing Date to the Company as follows (unless as of a specific date
therein, in which case they shall be accurate as of such date):</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 21pt; text-align: justify; text-indent: 51pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 21pt; text-align: justify; text-indent: 51pt">(a)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Organization; Authority</U>. Such Purchaser is either an individual or an entity duly incorporated or formed, validly
existing and in good standing under the laws of the jurisdiction of its incorporation or formation with full right, corporate,
partnership, limited liability company or similar power and authority to enter into and to consummate the transactions contemplated
by the Transaction Documents and otherwise to carry out its obligations hereunder and thereunder. The execution and delivery of
the Transaction Documents and performance by such Purchaser of the transactions contemplated by the Transaction Documents have
been duly authorized by all necessary corporate, partnership, limited liability company or similar action, as applicable, on the
part of such Purchaser. Each Transaction Document to which it is a party has been duly executed by such Purchaser, and when delivered
by such Purchaser in accordance with the terms hereof, will constitute the valid and legally binding obligation of such Purchaser,
enforceable against it 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&rsquo; 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 21pt; text-align: justify; text-indent: 51pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 21pt; text-align: justify; text-indent: 51pt">(b)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Understandings or Arrangements</U>. Such Purchaser is acquiring the Securities 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
such Securities (this representation and warranty not limiting such Purchaser&rsquo;s right to sell the Securities pursuant to
the Registration Statement or otherwise in compliance with applicable federal and state securities laws). Such Purchaser is acquiring
the Securities hereunder in the ordinary course of its business.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 21pt; text-align: justify; text-indent: 51pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 21pt; text-align: justify; text-indent: 51pt">(c)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Purchaser Status</U>. At the time such Purchaser was offered the Securities, it was, and as of the date hereof it is,
and on each date on which it exercises any Warrants, it will be an &ldquo;accredited investor&rdquo; as defined in Rule 501(a)(1),
(a)(2), (a)(3), (a)(7) or (a)(8) under the Securities Act.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 21pt; text-align: justify; text-indent: 51pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 21pt; text-align: justify; text-indent: 51pt">(d)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Experience of Such Purchaser</U>. Such Purchaser, either alone or together with its representatives, has such knowledge,
sophistication and experience in business and financial matters so as to be capable of evaluating the merits and risks of the
prospective investment in the Securities, and has so evaluated the merits and risks of such investment. Such Purchaser is able
to bear the economic risk of an investment in the Securities and, at the present time, is able to afford a complete loss of such
investment.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 21pt; text-align: justify; text-indent: 51pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 21pt; text-align: justify; text-indent: 51pt">(e)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Access to Information</U>. Such Purchaser acknowledges that it has had the opportunity to review the Transaction Documents
(including all exhibits and schedules thereto) and the SEC Reports and has been afforded, (i) the opportunity to ask such questions
as it has deemed necessary of, and to receive answers from, representatives of the Company concerning the terms and conditions
of the offering of the Securities and the merits and risks of investing in the Securities; (ii) access to information about the
Company and its financial condition, results of operations, business, properties, management and prospects sufficient to enable
it to evaluate its investment; and (iii) the opportunity to obtain such additional information that the Company possesses or can
acquire without unreasonable effort or expense that is necessary to make an informed investment decision with respect to the investment.&nbsp;
Such Purchaser acknowledges and agrees that neither the Placement Agent nor any Affiliate of the Placement Agent has provided
such Purchaser with any information or advice with respect to the Securities nor is such information or advice necessary or desired.&nbsp;
Neither the Placement Agent nor any Affiliate has made or makes any representation as to the Company or the quality of the Securities
and the Placement Agent and any Affiliate may have acquired non-public information with respect to the Company which such Purchaser
agrees need not be provided to it.&nbsp; In connection with the issuance of the Securities to such Purchaser, neither the Placement
Agent nor any of its Affiliates has acted as a financial advisor or fiduciary to such Purchaser.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 21pt; text-align: justify; text-indent: 51pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 21pt; text-align: justify; text-indent: 51pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 21pt; text-align: justify; text-indent: 51pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 21pt; text-align: justify; text-indent: 51pt"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 21pt; text-align: justify; text-indent: 51pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 21pt; text-align: justify; text-indent: 51pt">(f)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Certain Transactions and Confidentiality</U>. Other than consummating the transactions contemplated hereunder, such
Purchaser has not, nor has any Person acting on behalf of or pursuant to any understanding with such Purchaser, directly or indirectly
executed any purchases or sales, including Short Sales,&nbsp;of the securities of the Company during the period commencing as
of the time that such Purchaser first received a term sheet (written or oral) from the Company or any other Person representing
the Company setting forth the material terms of the transactions contemplated hereunder and ending immediately prior to the execution
hereof. Notwithstanding the foregoing, in the case of a Purchaser that is a multi-managed investment vehicle whereby separate
portfolio managers manage separate portions of such Purchaser&rsquo;s assets and the portfolio managers have no direct knowledge
of the investment decisions made by the portfolio managers managing other portions of such Purchaser&rsquo;s assets, the representation
set forth above shall only apply with respect to the portion of assets managed by the portfolio manager that made the investment
decision to purchase the Securities covered by this Agreement. Other than to other Persons party to this Agreement or to such
Purchaser&rsquo;s representatives, including, without limitation, its officers, directors, partners, legal and other advisors,
employees, agents and Affiliates, such Purchaser has maintained the confidentiality of all disclosures made to it in connection
with this transaction (including the existence and terms of this transaction). Notwithstanding the foregoing, for the avoidance
of doubt, nothing contained herein shall constitute a representation or warranty, or preclude any actions, with respect to locating
or borrowing shares in order to effect Short Sales or similar transactions in the future.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 21pt; text-align: justify; text-indent: 51pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">The Company acknowledges
and agrees that the representations contained in this Section 3.2 shall not modify, amend or affect such Purchaser&rsquo;s right
to rely on the Company&rsquo;s representations and warranties contained in this Agreement or any representations and warranties
contained in any other Transaction Document or any other document or instrument executed and/or delivered in connection with this
Agreement or the consummation of the transactions contemplated hereby. Notwithstanding the foregoing, for the avoidance of doubt,
nothing contained herein shall constitute a representation or warranty, or preclude any actions, with respect to locating or borrowing
shares in order to effect Short Sales or similar transactions in the future.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0in"><B>ARTICLE IV.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0in"><BR>
OTHER AGREEMENTS OF THE PARTIES</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">4.1<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Warrant Shares</U>. If all or any portion of a Warrant is exercised at a time when there is an effective registration
statement to cover the issuance or resale of the Warrant Shares or if the Warrant is exercised via cashless exercise, the Warrant
Shares issued pursuant to any such exercise shall be issued free of all legends. If at any time following the date hereof the
Registration Statement (or any subsequent registration statement registering the sale or resale of the Warrant Shares) is not
effective or is not otherwise available for the sale or resale of the Warrant Shares, the Company shall immediately notify the
holders of the Warrants in writing that such registration statement is not then effective and thereafter shall promptly notify
such holders when the registration statement is effective again and available for the sale or resale of the Warrant Shares (it
being understood and agreed that the foregoing shall not limit the ability of the Company to issue, or any Purchaser to sell,
any of the Warrant Shares in compliance with applicable federal and state securities laws). The Company shall use best efforts
to keep a registration statement (including the Registration Statement) registering the issuance or resale of the Warrant Shares
effective during the term of the Warrants.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">4.2<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Furnishing of Information</U>. Until the earliest of the time that (i) no Purchaser owns Securities or (ii) the Warrants
have expired, the Company covenants to timely file (or obtain extensions in respect thereof and file within the applicable grace
period) all reports required to be filed by the Company after the date hereof pursuant to the Exchange Act even if the Company
is not then subject to the reporting requirements of the Exchange Act.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">4.3<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Integration</U>. The Company shall not sell, offer for sale or solicit offers to buy or otherwise negotiate in respect
of any security (as defined in Section 2 of the Securities Act) that would be integrated with the offer or sale of the Securities
for purposes of the rules and regulations of any Trading Market such that it would require shareholder approval prior to the closing
of such other transaction unless shareholder approval is obtained before the closing of such subsequent transaction.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">4.4<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Securities Laws Disclosure; Publicity</U>. The Company shall (a) by 9:00 a.m. (New York City time) on the Trading Day
immediately following the date hereof, issue a press release disclosing the material terms of the transactions contemplated hereby,
and (b) file a Current Report on Form 8-K, including the Transaction Documents as exhibits thereto, with the Commission within
the time required by the Exchange Act. From and after the issuance of such press release, the Company represents to the Purchasers
that it shall have publicly disclosed all material, non-public information delivered to any of the Purchasers by the Company or
any of its Subsidiaries, or any of their respective officers, directors, employees or agents in connection with the transactions
contemplated by the Transaction Documents. In addition, effective upon the issuance of such press release, 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 any
of the Purchasers or any of their Affiliates on the other hand, shall terminate. The Company and each Purchaser shall consult
with each other in issuing any other press releases with respect to the transactions contemplated hereby, and neither the Company
nor any Purchaser shall issue any such press release nor otherwise make any such public statement without the prior consent of
the Company, with respect to any press release of any Purchaser, or without the prior consent of each Purchaser, with respect
to any press release of the Company, which consent shall not unreasonably be withheld or delayed, except if such disclosure is
required by law, in which case the disclosing party shall promptly provide the other party with prior notice of such public statement
or communication. Notwithstanding the foregoing, the Company shall not publicly disclose the name of any Purchaser, or include
the name of any Purchaser in any filing with the Commission or any regulatory agency or Trading Market, without the prior written
consent of such Purchaser, except (a) as required by federal securities law in connection with the filing of final Transaction
Documents with the Commission and (b) to the extent such disclosure is required by law or Trading Market regulations, in which
case the Company shall provide the Purchasers with prior notice of such disclosure permitted under this clause (b).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">4.5<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Shareholder Rights Plan</U>. No claim will be made or enforced by the Company or, with the consent of the Company, any
other Person, that any Purchaser is an &ldquo;<U>Acquiring Person</U>&rdquo; under any control share acquisition, business combination,
poison pill (including any distribution under a rights agreement) or similar anti-takeover plan or arrangement in effect or hereafter
adopted by the Company, or that any Purchaser could be deemed to trigger the provisions of any such plan or arrangement, by virtue
of receiving Securities under the Transaction Documents or under any other agreement between the Company and the Purchasers.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">4.6<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Non-Public Information</U>. Except with respect to the material terms and conditions of the transactions contemplated
by the Transaction Documents, which shall be disclosed pursuant to Section 4.4, the Company covenants and agrees that neither
it, nor any other Person acting on its behalf will provide any Purchaser or its agents or counsel with any information that constitutes,
or the Company reasonably believes constitutes, material non-public information, unless prior thereto such Purchaser shall have
consented to the receipt of such information and agreed with the Company to keep such information confidential. The Company understands
and confirms that each Purchaser shall be relying on the foregoing covenant in effecting transactions in securities of the Company.
To the extent that the Company delivers any material, non-public information to a Purchaser without such Purchaser&rsquo;s consent,
the Company hereby covenants and agrees that such Purchaser shall not have any duty of confidentiality to the Company, any of
its Subsidiaries, or any of their respective officers, directors, agents, employees or Affiliates, or a duty to the Company, any
of its Subsidiaries or any of their respective officers, directors, agents, employees or Affiliates not to trade on the basis
of, such material, non-public information, provided that the Purchaser shall remain subject to applicable law. To the extent that
any notice provided pursuant to any Transaction Document constitutes, or contains, material, non-public information regarding
the Company or any Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to a Current Report
on Form 8-K. The Company understands and confirms that each Purchaser shall be relying on the foregoing covenant in effecting
transactions in securities of the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">4.7<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Use of Proceeds</U>. The use of proceeds is set forth in the Prospectus.</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">4.8<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Indemnification of Purchasers</U>. Subject to the provisions of this Section 4.8, the Company will indemnify and hold
each Purchaser 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 such Purchaser (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 &ldquo;<U>Purchaser Party</U>&rdquo;) 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&rsquo; fees and
costs of investigation that any such Purchaser Party may suffer or incur as a result of or relating to (a) any breach of any of
the representations, warranties, covenants or agreements made by the Company in this Agreement or in the other Transaction Documents
or (b) any action instituted against the Purchaser 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 Purchaser Party, with respect to any of the transactions contemplated
by the Transaction Documents (unless such action is solely based upon a material breach of such Purchaser Party&rsquo;s representations,
warranties or covenants under the Transaction Documents or any agreements or understandings such Purchaser Party may have with
any such stockholder or any violations by such Purchaser Party of state or federal securities laws or any conduct by such Purchaser
Party which is finally judicially determined to constitute fraud, gross negligence or willful misconduct). If any action shall
be brought against any Purchaser Party in respect of which indemnity may be sought pursuant to this Agreement, such Purchaser
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 the Purchaser Party. Any Purchaser 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 Purchaser Party except to the extent that (i) the employment thereof has been specifically authorized by the Company in
writing, (ii) the Company has failed after a reasonable period of time to assume such defense and to employ counsel or (iii) 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 Purchaser 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 Purchaser Party under this Agreement
(y) for any settlement by a Purchaser Party effected without the Company&rsquo;s prior written consent, which shall not be unreasonably
withheld or delayed; or (z) to the extent, but only to the extent that a loss, claim, damage or liability is attributable to any
Purchaser Party&rsquo;s breach of any of the representations, warranties, covenants or agreements made by such Purchaser Party
in this Agreement or in the other Transaction Documents. The indemnification required by this Section 4.8 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.
The indemnity agreements contained herein shall be in addition to any cause of action or similar right of any Purchaser Party
against the Company or others and any liabilities the Company may be subject to pursuant to law.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">4.9<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Reservation of Common Stock</U>. As of the date hereof, the Company has reserved and the Company shall continue to reserve
and keep available at all times, free of preemptive rights, a sufficient number of shares of Common Stock for the purpose of enabling
the Company to issue Shares pursuant to this Agreement and Warrant Shares pursuant to any exercise of the Warrants.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">4.10<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Listing of Common Stock</U>. The Company hereby agrees to use best efforts to maintain the listing or quotation of the
Common Stock on the Trading Market on which it is currently listed, and concurrently with the Closing, the Company shall apply
to list or quote all of the Shares and Warrant Shares on such Trading Market and promptly secure the listing of all of the Shares
and Warrant Shares on such Trading Market. The Company further agrees, if the Company applies to have the Common Stock traded
on any other Trading Market, it will then include in such application all of the Shares and Warrant Shares, and will take such
other action as is necessary to cause all of the Shares and 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
Common Stock on a Trading Market and will comply in all respects with the Company&rsquo;s reporting, filing and other obligations
under the bylaws or rules of the Trading Market. The Company agrees to maintain the eligibility of the 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">4.11<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT>[Reserved]</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">4.12<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Subsequent Equity Sales</U>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(a)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT>From the date hereof until 90 days after the Closing Date, neither the Company nor any Subsidiary shall issue, enter into
any agreement to issue or announce the issuance or proposed issuance of any shares of Common Stock or Common Stock Equivalents.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(b)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT>From the date hereof until such time as no Purchaser holds any of the Warrants, 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 Common Stock or Common Stock
Equivalents (or a combination of units thereof) involving a Variable Rate Transaction. &ldquo;<U>Variable Rate Transaction</U>&rdquo;
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 Common Stock or (ii) enters into, or effects a transaction under, any agreement, including, but not limited to, an equity
line of credit, whereby the Company may issue securities at a future determined price; <U>provided</U>, <U>however</U>, upon the
completion of the restrictive period set forth in Section 4.12(a), the Company may draw down on its Common Stock Sales Agreement
with the Placement Agent, dated June 28, 2016. Any Purchaser 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(c)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT>Notwithstanding the foregoing, this Section 4.12 shall not apply in respect of an Exempt Issuance, except that no Variable
Rate Transaction shall be an Exempt Issuance.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">4.13<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Equal Treatment of Purchasers</U>. No consideration (including any modification of any Transaction Document) shall be
offered or paid to any Person to amend or consent to a waiver or modification of any provision of the Transaction Documents unless
the same consideration is also offered to all of the parties to the Transaction Documents. For clarification purposes, this provision
constitutes a separate right granted to each Purchaser by the Company and negotiated separately by each Purchaser, and is intended
for the Company to treat the Purchasers as a class and shall not in any way be construed as the Purchasers acting in concert or
as a group with respect to the purchase, disposition or voting of Securities or otherwise.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">4.14<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Certain Transactions and Confidentiality</U>. Each Purchaser, severally and not jointly with the other Purchasers, covenants
that neither it nor any Affiliate acting on its behalf or pursuant to any understanding with it will execute any purchases or
sales, including Short Sales of any of the Company&rsquo;s securities during the period commencing with the execution of this
Agreement and ending at such time that the transactions contemplated by this Agreement are first publicly announced pursuant to
the initial press release as described in Section 4.4.<FONT STYLE="color: windowtext">&nbsp; </FONT>Each Purchaser, severally
and not jointly with the other Purchasers, covenants that until such time as the transactions contemplated by this Agreement are
publicly disclosed by the Company pursuant to the initial press release as described in Section 4.4, such Purchaser will maintain
the confidentiality of the existence and terms of this transaction.&nbsp; N<FONT STYLE="color: windowtext">otwithstanding the
foregoing and notwithstanding anything contained in this Agreement to the contrary, the Company expressly acknowledges and agrees
that (i) no Purchaser makes any representation, warranty or covenant hereby that it will not engage in effecting transactions
in any securities of the Company after the time that the transactions contemplated by this Agreement are first publicly announced
pursuant to the initial press release as described in Section 4.4, (ii) no Purchaser shall be restricted or prohibited from effecting
any transactions in any securities of the Company in accordance with applicable securities laws from and after the time that the
transactions contemplated by this Agreement are first publicly announced pursuant to the initial press release as described in
Section 4.4 and (iii) no Purchaser shall have any duty of confidentiality or duty not to trade in the securities of the Company
to the Company or its Subsidiaries after the issuance of the initial press release as described in Section 4.4.&nbsp; </FONT>Notwithstanding
the foregoing, in the case of a Purchaser that is a multi-managed investment vehicle whereby separate portfolio managers manage
separate portions of such Purchaser&rsquo;s assets and the portfolio managers have no direct knowledge of the investment decisions
made by the portfolio managers managing other portions of such Purchaser&rsquo;s assets, the covenant set forth above shall only
apply with respect to the portion of assets managed by the portfolio manager that made the investment decision to purchase the
Securities covered by this Agreement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">4.15<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Capital Changes</U>. Until the one year anniversary of the Closing Date, the Company shall not undertake a reverse or
forward stock split or reclassification of the Common Stock without the prior written consent of the Purchasers holding a majority
in interest of the Shares.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">4.16<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><FONT STYLE="color: windowtext"><U>Exercise Procedures</U>. The form of Notice of Exercise included in the Warrants set
forth the totality of the procedures required of the Purchasers in order to exercise the Warrants. No additional legal opinion,
other information or instructions shall be required of the Purchasers to exercise their Warrants. Without limiting the preceding
sentences, no ink-original Notice of Exercise shall be required, nor shall any medallion guarantee (or other type of guarantee
or notarization) of any Notice of Exercise form be required in order to exercise the Warrants. The Company shall honor exercises
of the Warrants and shall deliver Warrant Shares in accordance with the terms, conditions and time periods set forth in the Transaction
Documents.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="color: windowtext">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0in"><B>ARTICLE V.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0in"><BR>
MISCELLANEOUS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">5.1<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Termination</U>.&nbsp; This Agreement may be terminated by any Purchaser, as to such Purchaser&rsquo;s obligations hereunder
only and without any effect whatsoever on the obligations between the Company and the other Purchasers, by written notice to the
other parties, if the Closing has not been consummated on or before _________ ___, 2017; <U>provided</U>, <U>however</U>, that
no such termination will affect the right of any party to sue for any breach by any other party (or parties).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">5.2<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Fees and Expenses</U>. Except as expressly set forth in the Transaction Documents to the contrary, each party shall
pay the fees and expenses of its advisers, counsel, accountants and other experts, if any, and all other expenses incurred by
such party incident to the negotiation, preparation, execution, delivery and performance of this Agreement. The Company shall
pay all Transfer Agent fees (including, without limitation, any fees required for same-day processing of any instruction letter
delivered by the Company and any exercise notice delivered by a Purchaser), stamp taxes and other taxes and duties levied in connection
with the delivery of any Securities to the Purchasers.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">5.3<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Entire Agreement</U>. The Transaction Documents, together with the exhibits and schedules thereto, the Prospectus and
the Prospectus Supplement, contain the entire understanding of the parties with respect to the subject matter hereof and thereof
and supersede all prior agreements and understandings, oral or written, with respect to such matters, which the parties acknowledge
have been merged into such documents, exhibits and schedules.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">5.4<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Notices</U>. 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 date of transmission, if such notice or
communication is delivered via facsimile at the facsimile number or 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 date of transmission, if such notice or communication is delivered via facsimile at the facsimile number or 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 (2<SUP>nd</SUP>) 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. To
the extent that any notice provided pursuant to any Transaction Document constitutes, or contains, material, non-public information
regarding the Company or any Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to a
Current Report on Form 8-K.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">5.5<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Amendments; Waivers</U>. No provision of this Agreement may be waived, modified, supplemented or amended except in a
written instrument signed, in the case of an amendment, by the Company and Purchasers which purchased at least 50.1% in interest
of the Shares based on the initial Subscription Amounts hereunder or, in the case of a waiver, by the party against whom enforcement
of any such waived provision is sought, provided that if any amendment, modification or waiver disproportionately and adversely
impacts a Purchaser (or group of Purchasers), the consent of such disproportionately impacted Purchaser (or group of Purchasers)
shall also be required. No waiver of any default with respect to any provision, condition or requirement of this Agreement shall
be deemed to be a continuing waiver in the future or a waiver of any subsequent default or a waiver of any other provision, condition
or requirement hereof, nor shall any delay or omission of any party to exercise any right hereunder in any manner impair the exercise
of any such right. Any proposed amendment or waiver that disproportionately, materially and adversely affects the rights and obligations
of any Purchaser relative to the comparable rights and obligations of the other Purchasers shall require the prior written consent
of such adversely affected Purchaser. Any amendment effected in accordance with this Section 5.5 shall be binding upon each Purchaser
and holder of Securities and the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">5.6<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Headings</U>. The headings herein are for convenience only, do not constitute a part of this Agreement and shall not
be deemed to limit or affect any of the provisions hereof.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">5.7<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Successors and Assigns</U>. This Agreement shall be binding upon and inure to the benefit of the parties and their successors
and permitted assigns. The Company may not assign this Agreement or any rights or obligations hereunder without the prior written
consent of each Purchaser (other than by merger). Any Purchaser may assign any or all of its rights under this Agreement to any
Person to whom such Purchaser assigns or transfers any Securities, provided that such transferee agrees in writing to be bound,
with respect to the transferred Securities, by the provisions of the Transaction Documents that apply to the &ldquo;Purchasers.&rdquo;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">5.8<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>No Third-Party Beneficiaries</U>. The Placement Agent shall be the third party beneficiary of the representations and
warranties of the Company in Section 3.1 and the representations and warranties of the Purchasers in Section 3.2. This Agreement
is intended for the benefit of the parties hereto and their respective successors and permitted assigns and is not for the benefit
of, nor may any provision hereof be enforced by, any other Person, except as otherwise set forth in Section 4.8 and this Section
5.8.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">5.9<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Governing Law</U>. All questions concerning the construction, validity, enforcement and interpretation of the Transaction
Documents 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 Agreement and any other Transaction Documents (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 the Transaction Documents), 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">5.10<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Survival</U>. The representations and warranties contained herein shall survive the Closing and the delivery of the
Securities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">5.11<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Execution</U>. This Agreement may be executed in two or more counterparts, all of which when taken together shall be
considered one and the same agreement and shall become effective when counterparts have been signed by each party and delivered
to each other party, it being understood that the parties need not sign the same counterpart. In the event that any signature
is delivered by facsimile transmission or by e-mail delivery of a &ldquo;.pdf&rdquo; format data file, such signature shall create
a valid and binding obligation of the party executing (or on whose behalf such signature is executed) with the same force and
effect as if such facsimile or &ldquo;.pdf&rdquo; signature page were an original thereof.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">5.12<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Severability</U>. If any term, provision, covenant or restriction of this Agreement is held by a court of competent
jurisdiction to be invalid, illegal, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions
set forth herein shall remain in full force and effect and shall in no way be affected, impaired or invalidated, and the parties
hereto shall use their commercially reasonable efforts to find and employ an alternative means to achieve the same or substantially
the same result as that contemplated by such term, provision, covenant or restriction. It is hereby stipulated and declared to
be the intention of the parties that they would have executed the remaining terms, provisions, covenants and restrictions without
including any of such that may be hereafter declared invalid, illegal, void or unenforceable.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">5.13<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Rescission and Withdrawal Right</U>. Notwithstanding anything to the contrary contained in (and without limiting any
similar provisions of) any of the other Transaction Documents, whenever any Purchaser exercises a right, election, demand or option
under a Transaction Document and the Company does not timely perform its related obligations within the periods therein provided,
then such Purchaser may rescind or withdraw, in its sole discretion from time to time upon written notice to the Company, any
relevant notice, demand or election in whole or in part without prejudice to its future actions and rights; <U>provided</U>, <U>however</U>,
that, in the case of a rescission of an exercise of a Warrant, the applicable Purchaser shall be required to return any shares
of Common Stock subject to any such rescinded exercise notice concurrently with the return to such Purchaser of the aggregate
exercise price paid to the Company for such shares and the restoration of such Purchaser&rsquo;s right to acquire such shares
pursuant to such Purchaser&rsquo;s Warrant (including, issuance of a replacement warrant certificate evidencing such restored
right).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">5.14<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Replacement of Securities</U>. If any certificate or instrument evidencing any Securities is mutilated, lost, stolen
or destroyed, the Company shall issue or cause to be issued in exchange and substitution for and upon cancellation thereof (in
the case of mutilation), or in lieu of and substitution therefor, a new certificate or instrument, but only upon receipt of evidence
reasonably satisfactory to the Company of such loss, theft or destruction. The applicant for a new certificate or instrument under
such circumstances shall also pay any reasonable third-party costs (including customary indemnity) associated with the issuance
of such replacement Securities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">5.15<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Remedies</U>. In addition to being entitled to exercise all rights provided herein or granted by law, including recovery
of damages, each of the Purchasers and the Company will be entitled to specific performance under the Transaction Documents. The
parties agree that monetary damages may not be adequate compensation for any loss incurred by reason of any breach of obligations
contained in the Transaction Documents and hereby agree to waive and not to assert in any Action for specific performance of any
such obligation the defense that a remedy at law would be adequate.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">5.16<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Payment Set Aside</U>. To the extent that the Company makes a payment or payments to any Purchaser pursuant to any Transaction
Document or a Purchaser enforces or exercises its rights thereunder, and such payment or payments or the proceeds of such enforcement
or exercise or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside, recovered
from, disgorged by or are required to be refunded, repaid or otherwise restored to the Company, a trustee, receiver or any other
Person under any law (including, without limitation, any bankruptcy law, state or federal law, common law or equitable cause of
action), then to the extent of any such restoration the obligation or part thereof originally intended to be satisfied shall be
revived and continued in full force and effect as if such payment had not been made or such enforcement or setoff had not occurred.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">5.17<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Independent Nature of Purchasers&rsquo; Obligations and Rights</U>. The obligations of each Purchaser under any Transaction
Document are several and not joint with the obligations of any other Purchaser, and no Purchaser shall be responsible in any way
for the performance or non-performance of the obligations of any other Purchaser under any Transaction Document. Nothing contained
herein or in any other Transaction Document, and no action taken by any Purchaser pursuant hereto or thereto, shall be deemed
to constitute the Purchasers as a partnership, an association, a joint venture or any other kind of entity, or create a presumption
that the Purchasers are in any way acting in concert or as a group with respect to such obligations or the transactions contemplated
by the Transaction Documents. Each Purchaser shall be entitled to independently protect and enforce its rights including, without
limitation, the rights arising out of this Agreement or out of the other Transaction Documents, and it shall not be necessary
for any other Purchaser to be joined as an additional party in any Proceeding for such purpose. Each Purchaser has been represented
by its own separate legal counsel in its review and negotiation of the Transaction Documents. For reasons of administrative convenience
only, each Purchaser and its respective counsel have chosen to communicate with the Company through EGS. EGS does not represent
any of the Purchasers and only represents the Placement Agent. The Company has elected to provide all Purchasers with the same
terms and Transaction Documents for the convenience of the Company and not because it was required or requested to do so by any
of the Purchasers. It is expressly understood and agreed that each provision contained in this Agreement and in each other Transaction
Document is between the Company and a Purchaser, solely, and not between the Company and the Purchasers collectively and not between
and among the Purchasers.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">5.18<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Liquidated Damages</U>. The Company&rsquo;s obligations to pay any partial liquidated damages or other amounts owing
under the Transaction Documents is a continuing obligation of the Company and shall not terminate until all unpaid partial liquidated
damages and other amounts have been paid notwithstanding the fact that the instrument or security pursuant to which such partial
liquidated damages or other amounts are due and payable shall have been canceled.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">5.19<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Saturdays, Sundays, Holidays, etc. </U>If the last or appointed day for the taking of any action or the expiration of
any right required or granted herein shall not be a Business Day, then such action may be taken or such right may be exercised
on the next succeeding Business Day.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">5.20<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Construction</U>. The parties agree that each of them and/or their respective counsel have reviewed and had an opportunity
to revise the Transaction Documents and, therefore, the normal rule of construction to the effect that any ambiguities are to
be resolved against the drafting party shall not be employed in the interpretation of the Transaction Documents or any amendments
thereto. In addition, each and every reference to share prices and shares of Common Stock in any Transaction Document shall be
subject to adjustment for reverse and forward stock splits, stock dividends, stock combinations and other similar transactions
of the Common Stock that occur after the date of this Agreement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">5.21<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><B><U>WAIVER OF JURY TRIAL</U>. <U>IN ANY ACTION, SUIT, OR PROCEEDING IN ANY JURISDICTION BROUGHT BY ANY PARTY AGAINST
ANY OTHER PARTY, THE PARTIES EACH KNOWINGLY AND INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY,
UNCONDITIONALLY, IRREVOCABLY AND EXPRESSLY WAIVES FOREVER TRIAL BY JURY. </U></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><I>(Signature Pages Follow)</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><I>&nbsp;</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><I>&nbsp;</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><I>&nbsp;</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><I>&nbsp;</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">IN WITNESS WHEREOF,
the parties hereto have caused this Securities Purchase Agreement to be duly executed by their respective authorized signatories
as of the date first indicated above.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 50%"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="text-transform: uppercase"><B>Aethlon
                           Medical, inc.</B></FONT></P></TD>
    <TD STYLE="width: 50%; font-size: 10pt; layout-grid-mode: line"><U>Address for Notice:</U></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="font-size: 10pt; layout-grid-mode: line">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="font-size: 10pt; layout-grid-mode: line">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="font-size: 10pt; layout-grid-mode: line">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">By:__________________________________________</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.25in">Name:</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.25in">Title:</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">With a copy to (which shall not constitute notice):</P></TD>
    <TD><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">E-Mail:</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Fax:</P></TD></TR>
<TR STYLE="vertical-align: top">
    <TD></TD>
    <TD STYLE="font-size: 10pt; layout-grid-mode: line">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">SIGNATURE PAGE FOR PURCHASER FOLLOWS]</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">[PURCHASER SIGNATURE PAGES TO <FONT STYLE="text-transform: uppercase">AEMD
</FONT>SECURITIES PURCHASE AGREEMENT]</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">IN WITNESS WHEREOF,
the undersigned have caused this Securities Purchase Agreement to be duly executed by their respective authorized signatories
as of the date first indicated above.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Name of Purchaser: ________________________________________________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><I>&nbsp;</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><I>Signature of Authorized Signatory of
Purchaser</I>: _________________________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Name of Authorized Signatory: _______________________________________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Title of Authorized Signatory: ________________________________________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Email Address of Authorized Signatory:_________________________________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Facsimile Number of Authorized Signatory: __________________________________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Address for Notice to Purchaser:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Address for Delivery of Securities to Purchaser (if not same
as address for notice):</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Subscription Amount: $_________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Beneficial Ownership Limit (Circle One): 4.99% 9.99% 19.99%</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Shares: _________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Class A Warrant Shares: __________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Class B Warrant Shares: __________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">EIN Number: _______________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="font-family: Wingdings">o
</FONT>Notwithstanding anything contained in this Agreement to the contrary, by checking this box (i) the obligations of the above-signed
to purchase the securities set forth in this Agreement to be purchased from the Company by the above-signed, and the obligations
of the Company to sell such securities to the above-signed, shall be unconditional and all conditions to Closing shall be disregarded,
(ii) the Closing shall occur by the second (2<SUP>nd</SUP>) Trading Day following the date of this Agreement, and (iii) any condition
to Closing contemplated by this Agreement (but prior to being disregarded by clause (i) above) that required delivery by the Company
or the above-signed of any agreement, instrument, certificate or the like or purchase price (as applicable) shall no longer be
a condition and shall instead be an unconditional obligation of the Company or the above-signed (as applicable) to deliver such
agreement, instrument, certificate or the like or purchase price (as applicable) to such other party on the Closing Date.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">[SIGNATURE PAGES CONTINUE]</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>EXHIBIT A</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>COMMON STOCK PURCHASE WARRANT</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="text-transform: uppercase"><B>aethlon
medical, inc.</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="text-transform: uppercase"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: top; text-align: left">
    <TD STYLE="width: 50%">Warrant Shares: _______</TD>
    <TD STYLE="width: 50%; text-align: center">Initial Exercise Date: _______, 2017</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">THIS COMMON STOCK PURCHASE
WARRANT (the &ldquo;<U>Warrant</U>&rdquo;) certifies that, for value received, _____________ or its assigns (the &ldquo;<U>Holder</U>&rdquo;)
is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter set forth, at any time on
or after the date hereof (the &ldquo;<U>Initial Exercise Date</U>&rdquo;) and on or prior to 5:00 p.m. (New York City time) on
______________<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><SUP>[1]</SUP></FONT> (the &ldquo;<U>Termination
Date</U>&rdquo;) but not thereafter, to subscribe for and purchase from Aethlon Medical, Inc., a Nevada corporation (the &ldquo;<U>Company</U>&rdquo;),
up to ______ shares (as subject to adjustment hereunder, the &ldquo;<U>Warrant Shares</U>&rdquo;) of Common Stock. 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).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><U>Section 1</U>.<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Definitions</U>. In addition to the terms defined elsewhere in this Agreement, the following terms have the meanings
indicated in this Section 1:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Affiliate</U>&rdquo;
means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common
control with a Person, as such terms are used in and construed under Rule 405 under the Securities Act.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Bid
Price</U>&rdquo; 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 L.P. (based
on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b)&nbsp; 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 in the &ldquo;Pink Sheets&rdquo; published by OTC Markets Group, Inc. (or a similar organization
or agency succeeding to its functions of reporting prices), the most recent bid price per share of the Common Stock so reported,
or (d)&nbsp;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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Business
Day</U>&rdquo; means any day except any Saturday, any Sunday, any day which is a federal legal holiday in the United States or
any day on which banking institutions in the State of New York are authorized or required by law or other governmental action
to close.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Commission</U>&rdquo;
means the United States Securities and Exchange Commission.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Exchange
Act</U>&rdquo; means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Person</U>&rdquo;
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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Securities
Act</U>&rdquo; means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: left">____________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><SUP>&nbsp;</SUP></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><SUP>[1]
</SUP></FONT>The date that is the _____ year anniversary of the Initial Exercise Date, provided that, if such date is not a Trading
Day, insert the immediately following Trading Day.</P>





<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Trading
Day</U>&rdquo; means a day on which the Common Stock is traded on a Trading Market.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Trading
Market</U>&rdquo; means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on
the date in question: the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market,
the New York Stock Exchange or the OTC Bulletin Board (or any successors to any of the foregoing.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Transfer
Agent</U>&rdquo; means Computershare Investor Services, the current transfer agent of the Company, with a mailing address of 350
Indiana Street, Suite 800, Golden, Colorado 80401 and a facsimile number of _______________, and any successor transfer agent
of the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>VWAP</U>&rdquo;
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 L.P. (based
on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b)&nbsp; 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 in the &ldquo;Pink Sheets&rdquo; published by OTC Markets Group, Inc. (or a similar organization
or agency succeeding to its functions of reporting prices), the most recent bid price per share of the Common Stock so reported,
or (d)&nbsp;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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><U>Section 2</U>.<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>Exercise</U>.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">a)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Exercise of Warrant</U>. 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 and on or before the Termination Date by delivery to the Company of
a duly executed facsimile copy (or e-mail attachment) of the Notice of Exercise in the form annexed hereto (the &ldquo;<U>Notice
of Exercise</U>&rdquo;). By the Standard Settlement Period Delivery Date (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 shares specified in the applicable
Notice of Exercise by wire transfer or cashier&rsquo;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,
in which case, 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 available hereunder shall have the effect of lowering the outstanding number of
Warrant Shares purchasable hereunder in an amount equal to the applicable number of Warrant Shares purchased. The Holder and the
Company shall maintain records showing the number of Warrant Shares purchased and the date of such purchases. The Company shall
deliver any objection to any Notice of Exercise within one (1) Business Day of receipt of such notice. <B>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></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">b)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Exercise Price</U>. The exercise price per share of Common Stock under this Warrant shall be <B>$</B>_____, subject
to adjustment hereunder (the &ldquo;<U>Exercise Price</U>&rdquo;).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">c)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Cashless Exercise</U>. If at the time of exercise hereof there is no effective registration statement registering, or
the prospectus contained therein is not available for the issuance of the Warrant Shares to the Holder, then this Warrant may
also be exercised, in whole or in part, at such time by means of a &ldquo;cashless exercise&rdquo; 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:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 103.5pt; text-align: justify; text-indent: -31.5pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 103.5pt; text-align: justify; text-indent: -31.5pt">(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 &ldquo;regular trading hours&rdquo;
(as defined in Rule 600(b)(64) of Regulation NMS promulgated under the federal securities laws) on such Trading Day, (ii) at the
option of the Holder, either (y) the VWAP on the Trading Day immediately preceding the date of the applicable Notice of Exercise
or (z) the Bid Price of the Common Stock on the principal Trading Market as reported by Bloomberg L.P. as of the time of the Holder&rsquo;s
execution of the applicable Notice of Exercise if such Notice of Exercise is executed during &ldquo;regular trading hours&rdquo;
on a Trading Day and is delivered within two (2) hours thereafter 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 &ldquo;regular trading hours&rdquo; on such Trading
Day;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 103.5pt; text-align: justify; text-indent: -31.5pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: -0.5in">(B) = the
Exercise Price of this Warrant, as adjusted hereunder; and</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: -0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 103.5pt; text-align: justify; text-indent: -31.5pt">(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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 103.5pt; text-align: justify; text-indent: -31.5pt">&nbsp;</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 103.5pt; text-align: justify; text-indent: -31.5pt"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"><FONT STYLE="background-color: white">If
Warrant Shares are issued in such a cashless exercise, the parties acknowledge and agree that in accordance with Section 3(a)(9)
of the Securities Act, the Warrant Shares shall take on the registered characteristics of the Warrants being exercised.&nbsp;&nbsp;The
Company agrees not to take any position contrary to this Section 2(c).</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"><FONT STYLE="background-color: white">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">Notwithstanding
anything herein to the contrary, on the Termination Date, this Warrant shall be automatically exercised via cashless exercise
pursuant to this Section 2(c).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">d)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Mechanics of Exercise</U>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">i.<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Delivery of Warrant Shares Upon Exercise</U>. The Company shall cause the Warrant Shares purchased hereunder to be transmitted
by the Transfer Agent to the Holder by crediting the account of the Holder&rsquo;s or its designee&rsquo;s balance account with
The Depository Trust Company through its Deposit or Withdrawal at Custodian system (&ldquo;<U>DWAC</U>&rdquo;) if the Company
is then a participant in such system and either (A) there is an effective registration statement permitting the issuance of the
Warrant Shares to or resale of the Warrant Shares by Holder or (B) this Warrant is being exercised via cashless exercise, and
otherwise by physical delivery of a certificate, registered in the Company&rsquo;s share register in the name of the Holder or
its designee, for the number of Warrant Shares to which the Holder is entitled pursuant to such exercise to the address specified
by the Holder in the Notice of Exercise by the date that is the earlier of (A) the Standard Settlement Period Delivery Date after
the delivery to the Company of the Notice of Exercise and (B) one (1) Trading Day after delivery of the aggregate Exercise Price
to the Company (such date, the &ldquo;<U>Warrant Share Delivery Date</U>&rdquo;). 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 by the Standard Settlement Period Delivery Date 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 such
liquidated damages begin to accrue) for each Trading Day after such Warrant Share Delivery Date until such Warrant Shares are
delivered or Holder rescinds such exercise. The Company agrees to maintain a transfer agent that is a participant in the FAST
program so long as this Warrant remains outstanding and exercisable. As used herein, &ldquo;<U>Standard Settlement Period</U>&rdquo;
means the standard settlement period, expressed in a number of Trading Days, on the Company&rsquo;s primary Trading Market with
respect to the Common Stock as in effect on the date of delivery of the Notice of Exercise and &ldquo;<U>Standard Settlement Period
Delivery Date</U>&rdquo; means the Trading Day for delivery of Warrant Shares in compliance with the Standard Settlement Period.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">ii.<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Delivery of New Warrants Upon Exercise</U>. 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">iii.<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Rescission Rights</U>. 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">iv.<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Compensation for Buy-In on Failure to Timely Deliver Warrant Shares Upon Exercise</U>. 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&rsquo;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 &ldquo;<U>Buy-In</U>&rdquo;), then the Company shall (A) pay in cash
to the Holder the amount, if any, by which (x) the Holder&rsquo;s total purchase price (including brokerage commissions, if any)
for the shares of Common Stock so purchased exceeds (y) the amount obtained by multiplying (1) the number of Warrant Shares that
the Company was required to deliver to the 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 Common Stock having
a total purchase price of $11,000 to cover a Buy-In with respect to an attempted exercise of shares of Common Stock with an aggregate
sale price giving rise to such purchase obligation of $10,000, under clause (A) of the immediately preceding sentence the Company
shall be required to pay the Holder $1,000. The Holder shall provide the Company written notice indicating the amounts payable
to the Holder in respect of the Buy-In and, upon request of the Company, evidence of the amount of such loss. Nothing herein shall
limit a Holder&rsquo;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&rsquo;s failure to timely deliver shares
of Common Stock upon exercise of the Warrant as required pursuant to the terms hereof.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">v.<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>No Fractional Shares or Scrip</U>. No fractional shares or scrip representing fractional shares shall be issued upon
the exercise of this Warrant. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such
exercise, the Company shall, at its election, either pay a cash adjustment in respect of such final fraction in an amount equal
to such fraction multiplied by the Exercise Price or round up to the next whole share.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">vi.<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Charges, Taxes and Expenses</U>. Issuance of Warrant Shares shall be made without charge to the Holder for any issue
or transfer tax or other incidental expense in respect of the issuance of such Warrant Shares, all of which taxes and expenses
shall be paid by the Company, and such Warrant Shares shall be issued in the name of the Holder or in such name or names as may
be directed by the Holder; <U>provided</U>, <U>however</U>, that in the event that Warrant Shares are to be issued in a name other
than the name of the Holder, this Warrant when surrendered for exercise shall be accompanied by the Assignment Form attached hereto
duly executed by the Holder and the Company may require, as a condition thereto, the payment of a sum sufficient to reimburse
it for any transfer tax incidental thereto. The Company shall pay all Transfer Agent fees required for same-day processing of
any Notice of Exercise and all fees to the Depository Trust Company (or another established clearing corporation performing similar
functions) required for same-day electronic delivery of the Warrant Shares.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">vii.<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Closing of Books</U>. 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">e)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Holder&rsquo;s Exercise Limitations</U>. The Company shall not effect any exercise of this Warrant, and a Holder shall
not have the right to exercise any portion of this Warrant, pursuant to Section 2 or otherwise, to the extent that after giving
effect to such issuance after exercise as set forth on the applicable Notice of Exercise, the Holder (together with the Holder&rsquo;s
Affiliates, and any other Persons acting as a group together with the Holder or any of the Holder&rsquo;s Affiliates (such Persons,
&ldquo;<U>Attribution Parties</U>&rdquo;)), would beneficially own in excess of the Beneficial Ownership Limitation (as defined
below).&nbsp; 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 shares of Common Stock 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.&nbsp;
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&rsquo;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&rsquo;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.&nbsp; Upon the written or oral request of a Holder, the Company shall within two
Trading Days confirm orally and in writing to the Holder the number of shares of Common Stock then outstanding.&nbsp; 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 &ldquo;<U>Beneficial Ownership Limitation</U>&rdquo; shall be 4.99%/9.99%
of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock
issuable upon exercise of 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 the Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock 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 61<SUP>st</SUP> 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><U>Section 3</U>.<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Certain Adjustments</U>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">a)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Stock Dividends and Splits</U>. If the Company, at any time while this Warrant is outstanding: (i) pays a stock dividend
or otherwise makes a distribution or distributions on shares of its Common Stock or any other equity or equity equivalent securities
payable in shares of Common Stock (which, for avoidance of doubt, shall not include any shares of Common Stock 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 the 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 shall remain unchanged. Any adjustment made pursuant to this Section 3(a)
shall become effective immediately after the record date for the determination of stockholders entitled to receive such dividend
or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or re-classification.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">b)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT>[Reserved]</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">c)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Subsequent Rights Offerings</U>. 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 shares of Common Stock (the &ldquo;<U>Purchase Rights</U>&rdquo;), 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, to the extent that the Holder&rsquo;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).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">d)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Pro Rata Distributions</U>. 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 &ldquo;<U>Distribution</U>&rdquo;), 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 (<U>provided</U>, <U>however</U>, 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).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">e)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Fundamental Transaction</U>. If, at any time while this Warrant is outstanding, (i) the Company, directly or indirectly,
in one or more related transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company,
directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially
all of its assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange
offer (whether by the Company or another Person) is completed pursuant to which holders of Common Stock are permitted to sell,
tender or exchange their shares for other securities, cash or property and has been accepted by the holders of 50% or more of
the outstanding Common Stock, (iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification,
reorganization or recapitalization of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is
effectively converted into or exchanged for other securities, cash or property, or (v) the Company, directly or indirectly, in
one or more related transactions consummates a stock or share purchase agreement or other business combination (including, without
limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with another Person or group of Persons whereby
such other Person or group acquires more than 50% of the outstanding shares of Common Stock (not including any shares of Common
Stock held by the other Person or other Persons making or party to, or associated or affiliated with the other Persons making
or party to, such stock or share purchase agreement or other business combination) (each a &ldquo;<U>Fundamental Transaction</U>&rdquo;),
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 &ldquo;<U>Alternate Consideration</U>&rdquo;) 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. The Company shall cause any successor entity in a Fundamental
Transaction in which the Company is not the survivor (the &ldquo;<U>Successor Entity</U>&rdquo;) 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 and approved by the Holder (without
unreasonable delay) 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 &ldquo;Company&rdquo;
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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">f)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Calculations</U>. All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of
a share, as the case may be. For purposes of this Section 3, the number of 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">g)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Notice to Holder</U>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">i.<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Adjustment to Exercise Price</U>. 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">ii.<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Notice to Allow Exercise by Holder</U>. If (A) the Company shall declare a dividend (or any other distribution in whatever
form) on the Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common
Stock, (C) the Company shall authorize the granting to all holders of the 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 stockholders of the Company shall
be required in connection with any reclassification of the Common Stock, any consolidation or merger to which the Company is a
party, any sale or transfer of all or substantially all of the assets of the Company, or any compulsory share exchange whereby
the Common Stock is converted into other securities, cash or property, or (E) the Company shall authorize the voluntary or involuntary
dissolution, liquidation or winding up of the affairs of the Company, then, in each case, the Company shall cause to be delivered
by facsimile or email to the Holder at its last facsimile number or email address as it shall appear upon the Warrant Register
of the Company, at least 20 calendar days prior to the applicable record or effective date hereinafter specified, a notice stating
(x) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants,
or if a record is not to be taken, the date as of which the holders of the Common 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 the 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. 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.</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><U>Section 4</U>.<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Transfer of Warrant</U>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">a)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Transferability</U>. 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 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">b)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>New Warrants</U>. 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">c)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Warrant Register</U>. The Company shall register this Warrant, upon records to be maintained by the Company for that
purpose (the &ldquo;<U>Warrant Register</U>&rdquo;), 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><U>Section 5</U>.<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Miscellaneous</U>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">a)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>No Rights as Stockholder Until Exercise</U>. 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">b)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Loss, Theft, Destruction or Mutilation of Warrant</U>. 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">c)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Saturdays, Sundays, Holidays, etc</U>. If the last or appointed day for the taking of any action or the expiration of
any right required or granted herein shall not be a Business Day, then, such action may be taken or such right may be exercised
on the next succeeding Business Day.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">d)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Authorized Shares</U>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">The Company
covenants that, during the period the Warrant is outstanding, it will reserve from its authorized and unissued Common Stock a
sufficient number of shares to provide for the issuance of the Warrant Shares upon the exercise of any purchase rights under this
Warrant. The Company further covenants that its issuance of this Warrant shall constitute full authority to its officers who are
charged with the duty of issuing the necessary Warrant Shares upon the exercise of the purchase rights under this Warrant. The
Company will take all such reasonable action as may be necessary to assure that such Warrant Shares may be issued as provided
herein without violation of any applicable law or regulation, or of any requirements of the Trading Market upon which the Common
Stock may be listed. The Company covenants that all Warrant Shares which may be issued upon the exercise of the purchase rights
represented by this Warrant will, upon exercise of the purchase rights represented by this Warrant and payment for such Warrant
Shares in accordance herewith, be duly authorized, validly issued, fully paid and 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).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 1in">&nbsp;</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 1in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">Except and
to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending
its certificate of incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue
or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms
of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such
actions as may be necessary or appropriate to protect the rights of Holder as set forth in this Warrant against impairment. Without
limiting the generality of the foregoing, the Company will (i) not increase the par value of any Warrant Shares above the amount
payable therefor upon such exercise immediately prior to such increase in par value, (ii) take all such action as may be necessary
or appropriate in order that the Company may validly and legally issue fully paid and nonassessable Warrant Shares upon the exercise
of this Warrant and (iii) use commercially reasonable efforts to obtain all such authorizations, exemptions or consents from any
public regulatory body having jurisdiction thereof, as may be, necessary to enable the Company to perform its obligations under
this Warrant.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">e)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Jurisdiction</U>. All questions concerning the construction, validity, enforcement and interpretation of this Warrant
shall be determined in accordance with the provisions of the Purchase Agreement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

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    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">f)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Restrictions</U>. The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not
registered, and the Holder does not utilize cashless exercise, will have restrictions upon resale imposed by state and federal
securities laws.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">g)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Nonwaiver and Expenses</U>. 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&rsquo;s rights, powers or remedies. Without
limiting any other provision of this Warrant or the Purchase 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&rsquo; 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">h)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Notices</U>. 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 Purchase Agreement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">i)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Limitation of Liability</U>. No provision hereof, in the absence of any affirmative action by the Holder to exercise
this Warrant to purchase Warrant Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise
to any liability of the Holder for the purchase price of any Common Stock or as a stockholder of the Company, whether such liability
is asserted by the Company or by creditors of the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">j)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Remedies</U>. 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">k)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Successors and Assigns</U>. 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">l)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Amendment</U>. This Warrant may be modified or amended or the provisions hereof waived with the written consent of the
Company and the Holder.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">m)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Severability</U>. 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">n)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Headings</U>. 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">********************</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><I>(Signature Page Follows)</I><BR CLEAR="ALL"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in"></P>

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    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 50%">&nbsp;</TD>
    <TD STYLE="width: 50%"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="text-transform: uppercase"><B>aethlon
                           medical, inc.</B></FONT></P></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">By:__________________________________________</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.25in">Name:</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.25in">Title:</P></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>NOTICE OF EXERCISE</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="text-transform: uppercase">To:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;aethlon
medical, inc.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="text-transform: uppercase">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">(1)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;
</FONT>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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">(2)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;
</FONT>Payment shall take the form of (check applicable box):</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0in">[_] in lawful
money of the United States; or</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0in">[_] 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).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">(3)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;
</FONT>Please issue said Warrant Shares in the name of the undersigned or in such other name as is specified below:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1.5in">_______________________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Warrant Shares shall be delivered
to the following DWAC Account Number:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1.5in">_______________________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1.5in">_______________________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1.5in">_______________________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="text-transform: uppercase">[SIGNATURE
OF HOLDER]</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="text-transform: uppercase">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="text-transform: uppercase">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Name of Investing Entity: ________________________________________________________________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><I>Signature of Authorized Signatory of
Investing Entity</I>: _________________________________________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Name of Authorized Signatory: ___________________________________________________________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Title of Authorized Signatory: ____________________________________________________________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Date: ________________________________________________________________________________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt">&nbsp;</DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right"><B>EXHIBIT B</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-weight: normal">ASSIGNMENT
FORM</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-weight: normal">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 10.5pt"><I>(To assign the
foregoing Warrant, execute this form and supply required information. Do not use this form to purchase shares.)</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 10.5pt"><I>&nbsp;</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 10.5pt">FOR VALUE RECEIVED,
the foregoing Warrant and all rights evidenced thereby are hereby assigned to</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 10.5pt">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 50%; text-align: justify; font-size: 10pt">Name:</TD>
    <TD STYLE="width: 50%; text-align: justify; font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="text-align: justify; font-size: 10pt">(Please Print)</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="text-align: justify; font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify; font-size: 10pt">Address:</TD>
    <TD STYLE="text-align: justify; font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="text-align: justify; font-size: 10pt; padding-bottom: 1pt">(Please Print)</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="text-align: justify; font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Phone Number:</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P></TD>
    <TD STYLE="border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>Email Address:</TD>
    <TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify; font-size: 10pt">Dated: _______________ __, ______</TD>
    <TD STYLE="text-align: justify; font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="text-align: justify; font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify; font-size: 10pt">Holder&rsquo;s Signature:<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U></TD>
    <TD STYLE="text-align: justify; font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="text-align: justify; font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify; font-size: 10pt">Holder&rsquo;s Address:<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U></TD>
    <TD STYLE="text-align: justify; font-size: 10pt">&nbsp;</TD></TR>
</TABLE>




<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><B>EXHIBIT B</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>PRE-FUNDED COMMON STOCK PURCHASE WARRANT</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="text-transform: uppercase"><B>aethlon
medical, inc.</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="text-transform: uppercase"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: top; text-align: left">
    <TD STYLE="width: 50%">Warrant Shares: _______</TD>
    <TD STYLE="width: 50%; text-align: center">Initial Exercise Date: _______, 2017</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">THIS PRE-FUNDED COMMON
STOCK PURCHASE WARRANT (the &ldquo;<U>Warrant</U>&rdquo;) certifies that, for value received, _____________ or its assigns (the
&ldquo;<U>Holder</U>&rdquo;) is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter
set forth, at any time on or after the date hereof (the &ldquo;<U>Initial Exercise Date</U>&rdquo;) until this Warrant is exercised
in full (the &ldquo;<U>Termination Date</U>&rdquo;) but not thereafter, to subscribe for and purchase from Aethlon Medical, Inc.,
a Nevada corporation (the &ldquo;<U>Company</U>&rdquo;), up to ______ shares (as subject to adjustment hereunder, the &ldquo;<U>Warrant
Shares</U>&rdquo;) of Common Stock. 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).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><U>Section 1</U>.<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Definitions</U>. Capitalized terms used and not otherwise defined herein shall have the meanings set forth in that certain
Securities Purchase Agreement (the &ldquo;<U>Purchase Agreement</U>&rdquo;), dated __________, 2017, among the Company and the
purchasers signatory thereto.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><U>Section 2</U>.<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Exercise</U>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">a)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Exercise of Warrant</U>. 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 and on or before the Termination Date by delivery to the Company of
a duly executed facsimile copy (or e-mail attachment) of the Notice of Exercise in the form annexed hereto (the &ldquo;<U>Notice
of Exercise</U>&rdquo;). By the Standard Settlement Period Delivery Date (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 shares specified in the applicable
Notice of Exercise by wire transfer or cashier&rsquo;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,
in which case, 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 available hereunder shall have the effect of lowering the outstanding number of
Warrant Shares purchasable hereunder in an amount equal to the applicable number of Warrant Shares purchased. The Holder and the
Company shall maintain records showing the number of Warrant Shares purchased and the date of such purchases. The Company shall
deliver any objection to any Notice of Exercise within one (1) Business Day of receipt of such notice. <B>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></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">b)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Exercise Price</U>. The aggregate exercise price of this Warrant, except for a nominal exercise price of $0.01 per Warrant
Share, was pre-funded to the Company on or prior to the Initial Exercise Date and, consequently, no additional consideration (other
than the nominal exercise price of $0.01 per Warrant Share) shall be required to be paid by the Holder to any Person to effect
any exercise of this Warrant. The Holder shall not be entitled to the return or refund of all, or any portion, of such pre-paid
aggregate exercise price under any circumstance or for any reason whatsoever, including in the event this Warrant shall not have
been exercised prior to the Termination Date. The remaining unpaid exercise price per share of Common Stock under this Warrant
shall be $0.01, subject to adjustment hereunder (the &ldquo;<U>Exercise Price</U>&rdquo;).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">c)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Cashless Exercise</U>. If at the time of exercise hereof there is no effective registration statement registering, or
the prospectus contained therein is not available for the issuance of the Warrant Shares to the Holder, then this Warrant may
also be exercised, in whole or in part, at such time by means of a &ldquo;cashless exercise&rdquo; 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:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 103.5pt; text-align: justify; text-indent: -31.5pt">(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 &ldquo;regular trading hours&rdquo;
(as defined in Rule 600(b)(64) of Regulation NMS promulgated under the federal securities laws) on such Trading Day, (ii) at the
option of the Holder, either (y) the VWAP on the Trading Day immediately preceding the date of the applicable Notice of Exercise
or (z) the Bid Price of the Common Stock on the principal Trading Market as reported by Bloomberg L.P. as of the time of the Holder&rsquo;s
execution of the applicable Notice of Exercise if such Notice of Exercise is executed during &ldquo;regular trading hours&rdquo;
on a Trading Day and is delivered within two (2) hours thereafter 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 &ldquo;regular trading hours&rdquo; on such Trading
Day;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 103.5pt; text-align: justify; text-indent: -31.5pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: -0.5in">(B) = the
Exercise Price of this Warrant, as adjusted hereunder; and</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: -0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 103.5pt; text-align: justify; text-indent: -31.5pt">(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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 103.5pt; text-align: justify; text-indent: -31.5pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"><FONT STYLE="background-color: white">If
Warrant Shares are issued in such a cashless exercise, the parties acknowledge and agree that in accordance with Section 3(a)(9)
of the Securities Act, the Warrant Shares shall take on the registered characteristics of the Warrants being exercised.&nbsp;&nbsp;The
Company agrees not to take any position contrary to this Section 2(c).</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"><FONT STYLE="background-color: white">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>Bid
Price</U>&rdquo; 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 L.P. (based
on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b)&nbsp; 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 in the &ldquo;Pink Sheets&rdquo; published by OTC Markets Group, Inc. (or a similar organization
or agency succeeding to its functions of reporting prices), the most recent bid price per share of the Common Stock so reported,
or (d)&nbsp;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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&ldquo;<U>VWAP</U>&rdquo;
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 L.P. (based
on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b)&nbsp; 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 in the &ldquo;Pink Sheets&rdquo; published by OTC Markets Group, Inc. (or a similar organization
or agency succeeding to its functions of reporting prices), the most recent bid price per share of the Common Stock so reported,
or (d)&nbsp;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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">Notwithstanding
anything herein to the contrary, on the Termination Date, this Warrant shall be automatically exercised via cashless exercise
pursuant to this Section 2(c).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">d)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Mechanics of Exercise</U>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">i.<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Delivery of Warrant Shares Upon Exercise</U>. The Company shall cause the Warrant Shares purchased hereunder to be transmitted
by the Transfer Agent to the Holder by crediting the account of the Holder&rsquo;s or its designee&rsquo;s balance account with
The Depository Trust Company through its Deposit or Withdrawal at Custodian system (&ldquo;<U>DWAC</U>&rdquo;) if the Company
is then a participant in such system and either (A) there is an effective registration statement permitting the issuance of the
Warrant Shares to or resale of the Warrant Shares by Holder or (B) this Warrant is being exercised via cashless exercise, and
otherwise by physical delivery of a certificate, registered in the Company&rsquo;s share register in the name of the Holder or
its designee, for the number of Warrant Shares to which the Holder is entitled pursuant to such exercise to the address specified
by the Holder in the Notice of Exercise by the date that is the earlier of (A) the Standard Settlement Period Delivery Date after
the delivery to the Company of the Notice of Exercise and (B) one (1) Trading Day after delivery of the aggregate Exercise Price
to the Company (such date, the &ldquo;<U>Warrant Share Delivery Date</U>&rdquo;). 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 by the Standard Settlement Period Delivery Date 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 such
liquidated damages begin to accrue) for each Trading Day after such Warrant Share Delivery Date until such Warrant Shares are
delivered or Holder rescinds such exercise. The Company agrees to maintain a transfer agent that is a participant in the FAST
program so long as this Warrant remains outstanding and exercisable. As used herein, &ldquo;<U>Standard Settlement Period</U>&rdquo;
means the standard settlement period, expressed in a number of Trading Days, on the Company&rsquo;s primary Trading Market with
respect to the Common Stock as in effect on the date of delivery of the Notice of Exercise and &ldquo;<U>Standard Settlement Period
Delivery Date</U>&rdquo; means the Trading Day for delivery of Warrant Shares in compliance with the Standard Settlement Period.
Notwithstanding the foregoing, with respect to any Notice(s) of Exercise delivered on or prior to 12:00 p.m. (New York City time)
on the Initial Exercise Date, which may be delivered at any time after the time of execution of the Purchase Agreement, the Company
agrees to deliver the Warrant Shares subject to such notice(s) by 4:00 p.m. (New York City time) on the Initial Exercise Date.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">ii.<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Delivery of New Warrants Upon Exercise</U>. 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">iii.<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Rescission Rights</U>. 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">iv.<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Compensation for Buy-In on Failure to Timely Deliver Warrant Shares Upon Exercise</U>. 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&rsquo;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 &ldquo;<U>Buy-In</U>&rdquo;), then the Company shall (A) pay in cash
to the Holder the amount, if any, by which (x) the Holder&rsquo;s total purchase price (including brokerage commissions, if any)
for the shares of Common Stock so purchased exceeds (y) the amount obtained by multiplying (1) the number of Warrant Shares that
the Company was required to deliver to the 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 Common Stock having
a total purchase price of $11,000 to cover a Buy-In with respect to an attempted exercise of shares of Common Stock with an aggregate
sale price giving rise to such purchase obligation of $10,000, under clause (A) of the immediately preceding sentence the Company
shall be required to pay the Holder $1,000. The Holder shall provide the Company written notice indicating the amounts payable
to the Holder in respect of the Buy-In and, upon request of the Company, evidence of the amount of such loss. Nothing herein shall
limit a Holder&rsquo;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&rsquo;s failure to timely deliver shares
of Common Stock upon exercise of the Warrant as required pursuant to the terms hereof.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">v.<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>No Fractional Shares or Scrip</U>. No fractional shares or scrip representing fractional shares shall be issued upon
the exercise of this Warrant. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such
exercise, the Company shall, at its election, either pay a cash adjustment in respect of such final fraction in an amount equal
to such fraction multiplied by the Exercise Price or round up to the next whole share.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">vi.<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Charges, Taxes and Expenses</U>. Issuance of Warrant Shares shall be made without charge to the Holder for any issue
or transfer tax or other incidental expense in respect of the issuance of such Warrant Shares, all of which taxes and expenses
shall be paid by the Company, and such Warrant Shares shall be issued in the name of the Holder or in such name or names as may
be directed by the Holder; <U>provided</U>, <U>however</U>, that in the event that Warrant Shares are to be issued in a name other
than the name of the Holder, this Warrant when surrendered for exercise shall be accompanied by the Assignment Form attached hereto
duly executed by the Holder and the Company may require, as a condition thereto, the payment of a sum sufficient to reimburse
it for any transfer tax incidental thereto. The Company shall pay all Transfer Agent fees required for same-day processing of
any Notice of Exercise and all fees to the Depository Trust Company (or another established clearing corporation performing similar
functions) required for same-day electronic delivery of the Warrant Shares.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">vii.<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Closing of Books</U>. 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">e)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Holder&rsquo;s Exercise Limitations</U>. The Company shall not effect any exercise of this Warrant, and a Holder shall
not have the right to exercise any portion of this Warrant, pursuant to Section 2 or otherwise, to the extent that after giving
effect to such issuance after exercise as set forth on the applicable Notice of Exercise, the Holder (together with the Holder&rsquo;s
Affiliates, and any other Persons acting as a group together with the Holder or any of the Holder&rsquo;s Affiliates (such Persons,
&ldquo;<U>Attribution Parties</U>&rdquo;)), would beneficially own in excess of the Beneficial Ownership Limitation (as defined
below).&nbsp; 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 shares of Common Stock 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.&nbsp;
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&rsquo;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&rsquo;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.&nbsp; Upon the written or oral request of a Holder, the Company shall within two
Trading Days confirm orally and in writing to the Holder the number of shares of Common Stock then outstanding.&nbsp; 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 &ldquo;<U>Beneficial Ownership Limitation</U>&rdquo; shall be 4.99%/9.99%
of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock
issuable upon exercise of 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 the Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock 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 61<SUP>st</SUP> 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><U>Section 3</U>.<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Certain
Adjustments</U>.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">a)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Stock Dividends and Splits</U>. If the Company, at any time while this Warrant is outstanding: (i) pays a stock dividend
or otherwise makes a distribution or distributions on shares of its Common Stock or any other equity or equity equivalent securities
payable in shares of Common Stock (which, for avoidance of doubt, shall not include any shares of Common Stock 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 the 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 shall remain unchanged. Any adjustment made pursuant to this Section 3(a)
shall become effective immediately after the record date for the determination of stockholders entitled to receive such dividend
or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or re-classification.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">b)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT>[Reserved]</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">c)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Subsequent Rights Offerings</U>. 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 shares of Common Stock (the &ldquo;<U>Purchase Rights</U>&rdquo;), 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, to the extent that the Holder&rsquo;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).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">d)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Pro Rata Distributions</U>. 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 &ldquo;<U>Distribution</U>&rdquo;), 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 (<U>provided</U>, <U>however</U>, 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).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">e)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Fundamental Transaction</U>. If, at any time while this Warrant is outstanding, (i) the Company, directly or indirectly,
in one or more related transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company,
directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially
all of its assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange
offer (whether by the Company or another Person) is completed pursuant to which holders of Common Stock are permitted to sell,
tender or exchange their shares for other securities, cash or property and has been accepted by the holders of 50% or more of
the outstanding Common Stock, (iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification,
reorganization or recapitalization of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is
effectively converted into or exchanged for other securities, cash or property, or (v) the Company, directly or indirectly, in
one or more related transactions consummates a stock or share purchase agreement or other business combination (including, without
limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with another Person or group of Persons whereby
such other Person or group acquires more than 50% of the outstanding shares of Common Stock (not including any shares of Common
Stock held by the other Person or other Persons making or party to, or associated or affiliated with the other Persons making
or party to, such stock or share purchase agreement or other business combination) (each a &ldquo;<U>Fundamental Transaction</U>&rdquo;),
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 &ldquo;<U>Alternate Consideration</U>&rdquo;) 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. The Company shall cause any successor entity in a Fundamental
Transaction in which the Company is not the survivor (the &ldquo;<U>Successor Entity</U>&rdquo;) 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 and approved by the Holder (without
unreasonable delay) 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 &ldquo;Company&rdquo;
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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">f)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Calculations</U>. All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of
a share, as the case may be. For purposes of this Section 3, the number of 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">g)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Notice to Holder</U>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">i.<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Adjustment to Exercise Price</U>. 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">ii.<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Notice to Allow Exercise by Holder</U>. If (A) the Company shall declare a dividend (or any other distribution in whatever
form) on the Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common
Stock, (C) the Company shall authorize the granting to all holders of the 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 stockholders of the Company shall
be required in connection with any reclassification of the Common Stock, any consolidation or merger to which the Company is a
party, any sale or transfer of all or substantially all of the assets of the Company, or any compulsory share exchange whereby
the Common Stock is converted into other securities, cash or property, or (E) the Company shall authorize the voluntary or involuntary
dissolution, liquidation or winding up of the affairs of the Company, then, in each case, the Company shall cause to be delivered
by facsimile or email to the Holder at its last facsimile number or email address as it shall appear upon the Warrant Register
of the Company, at least 20 calendar days prior to the applicable record or effective date hereinafter specified, a notice stating
(x) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants,
or if a record is not to be taken, the date as of which the holders of the Common 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 the 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. 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><U>Section 4</U>.<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Transfer of Warrant</U>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">a)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Transferability</U>. 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 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">b)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>New Warrants</U>. 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">c)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Warrant Register</U>. The Company shall register this Warrant, upon records to be maintained by the Company for that
purpose (the &ldquo;<U>Warrant Register</U>&rdquo;), 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><U>Section 5</U>.<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Miscellaneous</U>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">a)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>No Rights as Stockholder Until Exercise</U>. 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">b)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Loss, Theft, Destruction or Mutilation of Warrant</U>. 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">c)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Saturdays, Sundays, Holidays, etc</U>. If the last or appointed day for the taking of any action or the expiration of
any right required or granted herein shall not be a Business Day, then, such action may be taken or such right may be exercised
on the next succeeding Business Day.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">d)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Authorized Shares</U>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">The Company
covenants that, during the period the Warrant is outstanding, it will reserve from its authorized and unissued Common Stock a
sufficient number of shares to provide for the issuance of the Warrant Shares upon the exercise of any purchase rights under this
Warrant. The Company further covenants that its issuance of this Warrant shall constitute full authority to its officers who are
charged with the duty of issuing the necessary Warrant Shares upon the exercise of the purchase rights under this Warrant. The
Company will take all such reasonable action as may be necessary to assure that such Warrant Shares may be issued as provided
herein without violation of any applicable law or regulation, or of any requirements of the Trading Market upon which the Common
Stock may be listed. The Company covenants that all Warrant Shares which may be issued upon the exercise of the purchase rights
represented by this Warrant will, upon exercise of the purchase rights represented by this Warrant and payment for such Warrant
Shares in accordance herewith, be duly authorized, validly issued, fully paid and 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).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">Except and
to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending
its certificate of incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue
or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms
of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such
actions as may be necessary or appropriate to protect the rights of Holder as set forth in this Warrant against impairment. Without
limiting the generality of the foregoing, the Company will (i) not increase the par value of any Warrant Shares above the amount
payable therefor upon such exercise immediately prior to such increase in par value, (ii) take all such action as may be necessary
or appropriate in order that the Company may validly and legally issue fully paid and nonassessable Warrant Shares upon the exercise
of this Warrant and (iii) use commercially reasonable efforts to obtain all such authorizations, exemptions or consents from any
public regulatory body having jurisdiction thereof, as may be, necessary to enable the Company to perform its obligations under
this Warrant.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">e)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Jurisdiction</U>. All questions concerning the construction, validity, enforcement and interpretation of this Warrant
shall be determined in accordance with the provisions of the Purchase Agreement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">f)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Restrictions</U>. The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not
registered, and the Holder does not utilize cashless exercise, will have restrictions upon resale imposed by state and federal
securities laws.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">g)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Nonwaiver and Expenses</U>. 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&rsquo;s rights, powers or remedies. Without
limiting any other provision of this Warrant or the Purchase 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&rsquo; 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">h)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Notices</U>. 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 Purchase Agreement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">i)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Limitation of Liability</U>. No provision hereof, in the absence of any affirmative action by the Holder to exercise
this Warrant to purchase Warrant Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise
to any liability of the Holder for the purchase price of any Common Stock or as a stockholder of the Company, whether such liability
is asserted by the Company or by creditors of the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">j)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Remedies</U>. 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">k)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Successors and Assigns</U>. 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">l)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Amendment</U>. This Warrant may be modified or amended or the provisions hereof waived with the written consent of the
Company and the Holder.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">m)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Severability</U>. 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">n)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><U>Headings</U>. 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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">********************</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><I>(Signature Page Follows)</I><BR CLEAR="ALL"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 50%">&nbsp;</TD>
    <TD STYLE="width: 50%"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="text-transform: uppercase"><B>aethlon
                           medical, inc.</B></FONT></P></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">By:__________________________________________</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.25in">Name:</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.25in">Title:</P></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>NOTICE OF EXERCISE</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="text-transform: uppercase">To:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;aethlon
medical, inc.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="text-transform: uppercase">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">(1)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;
</FONT>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.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">(2)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;
</FONT>Payment shall take the form of (check applicable box):</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0in">[_] in lawful
money of the United States; or</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0in">[_] 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).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.5in; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">(3)<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;
</FONT>Please issue said Warrant Shares in the name of the undersigned or in such other name as is specified below:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1.5in">_______________________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Warrant Shares shall be delivered
to the following DWAC Account Number:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1.5in">_______________________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1.5in">_______________________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1.5in">_______________________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 1.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="text-transform: uppercase">[SIGNATURE
OF HOLDER]</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><FONT STYLE="text-transform: uppercase">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Name of Investing Entity: ________________________________________________________________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><I>Signature of Authorized Signatory of
Investing Entity</I>: _________________________________________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Name of Authorized Signatory: ___________________________________________________________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Title of Authorized Signatory: ____________________________________________________________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Date: ________________________________________________________________________________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right"><B>EXHIBIT B</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-weight: normal">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-weight: normal">ASSIGNMENT
FORM</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-weight: normal">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 10.5pt"><I>(To assign the
foregoing Warrant, execute this form and supply required information. Do not use this form to purchase shares.)</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 10.5pt"><I>&nbsp;</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 10.5pt">FOR VALUE RECEIVED,
the foregoing Warrant and all rights evidenced thereby are hereby assigned to</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 10.5pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 10.5pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 10.5pt"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 50%; text-align: justify; font-size: 10pt">Name:</TD>
    <TD STYLE="width: 50%; text-align: justify; font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="text-align: justify; font-size: 10pt">(Please Print)</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="text-align: justify; font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify; font-size: 10pt">Address:</TD>
    <TD STYLE="text-align: justify; font-size: 10pt; border-bottom: Black 1pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="text-align: justify; font-size: 10pt; padding-bottom: 1pt">(Please Print)</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="text-align: justify; font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Phone Number:</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P></TD>
    <TD STYLE="border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>Email Address:</TD>
    <TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify; font-size: 10pt">Dated: _______________ __, ______</TD>
    <TD STYLE="text-align: justify; font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="text-align: justify; font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify; font-size: 10pt">Holder&rsquo;s Signature:<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U></TD>
    <TD STYLE="text-align: justify; font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="text-align: justify; font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify; font-size: 10pt">Holder&rsquo;s Address:<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U></TD>
    <TD STYLE="text-align: justify; font-size: 10pt">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 10.5pt">&nbsp;</P>



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<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="margin: 0">&nbsp;</P>

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</DOCUMENT>
<DOCUMENT>
<TYPE>EX-23.1
<SEQUENCE>4
<FILENAME>aethlon_ex2301.htm
<DESCRIPTION>CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
<TEXT>
<HTML>
<HEAD>
     <TITLE></TITLE>
</HEAD>
<BODY STYLE="font: 10pt Times New Roman, Times, Serif">

<P STYLE="margin: 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right"><B>Exhibit 23.1</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>CONSENT OF INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We consent to the use in this Registration
Statement on Form S-1/A of Aethlon Medical, Inc. of our report dated June 28, 2017, relating to the consolidated financial statements
of Aethlon Medical, Inc. (which report expresses an unqualified opinion and includes an explanatory paragraph relating to the Company&rsquo;s
ability to continue as a going concern), appearing in the Prospectus, which is part of this Registration Statement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We also consent to the reference to our
firm under the heading &ldquo;Experts&rdquo; in such Prospectus.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>/s/ SQUAR MILNER LLP</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">San Diego, California</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">September 29, 2017</P>



<P STYLE="margin: 0"></P>

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</SEC-DOCUMENT>
