Exhibit 10.15

 

BIOPHARMX CORPORATION

 

SUBSCRIPTION AGREEMENT

 

 

As of October 24, 2014

 

Mr. James Pekarsky

Chief Executive Officer

BioPharmX Corporation

1098 Hamilton Court

Menlo Park, California 94025

 

1.              Subscription.

 

(a)              The undersigned subscriber (the “Subscriber”) hereby
irrevocably subscribes for and agrees to purchase the number of shares (the
“Shares”) of the Company’s Series A preferred stock, par value $.001 per share
(“Series A Preferred Stock”), with the powers, preferences, rights,
qualifications, limitations and restrictions as set forth in the certificate of
designations in the form of Exhibit A hereto (the “Certificate of
Designations”), set forth on the signature page hereto from BioPharmX
Corporation, a Delaware corporation (the “Company”) for the purchase price of
$1.85 per share in connection with the Company’s offering of up to $8,000,000 in
Series A Preferred Stock together with the right to receive warrants for no
additional consideration (the “Offering”), in the form of Exhibit B hereto,
granting subscriber the right to purchase a number of shares of common stock,
par value $.001 per share, of the Company (the “Common Stock”) equal to fifty
percent (50%) of the number of shares of Common Stock into which the Shares are
convertible (such warrants, the “Warrants;” together with the Series A Preferred
Stock, the “Securities”).  The Warrants will have an initial exercise price
equal to $3.70 per share and shall be exercisable for a three (3) year period. 
In addition, the Shares and shares issuable upon exercise of the Warrants (the
“Warrant Shares”) shall have the registration rights as provided in Section 4
hereof.  In addition, Subscriber agrees to enter into the Investor Rights
Agreement (the “Investor Rights Agreement”), in the form of Exhibit C hereto,
granting the Subscriber additional rights from the Company and certain of its
shareholders.

 

This Subscription Agreement and the Investor Rights Agreement (the “Subscription
Agreement”) together with the Exhibits and Schedules thereto constitute the
“Offering Documents.”

 

This subscription is based solely upon the information provided in the Offering
Documents and upon the Subscriber’s own investigation as to the merits and risks
of this investment.  The Subscriber shall deliver herewith duly executed copies
of the signature pages to the following documents: (i) the Subscription
Agreement, and (ii) the Accredited Investor Questionnaire.

 

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The Offering may be consummated at more than one closing to occur on a date as
may be determined by the Company. Each such closing is referred to as a
“Closing” and the date of each such Closing is referred to as the “Closing
Date.”  A final Closing shall be held by the Company on or before September 30,
2014”), which can be extended up to October 15, 2014 by the Company’s board of
directors (the “Final Closing Date”).  At each Closing with respect to the
Shares subscribed for hereby and accepted by the Company, the Company shall
deliver to the Subscriber, the stock certificate for the Shares and the Warrants
certificate.  If the Company does not accept this subscription, in whole or in
part, it will promptly refund to the Subscriber, without deduction therefrom,
any subscription payment received from the Subscriber for the Shares, the
subscription for which was not accepted by the Company.

 

(b)             Subject to the terms and conditions hereinafter set forth, the
Subscriber hereby subscribes for and agrees to purchase the number of Shares
from the Company set forth on the signature page hereof, and when this Agreement
is accepted and executed by the Company, the Company agrees to issue such Shares
and Warrants to the Subscriber.  The subscription price is payable by wire
transfer pursuant to the following wire instructions.

 

WIRING INSTRUCTIONS

 

Bank’s Name and Address:

 

Bank of America

 

 

315 Montgomery Street

 

 

San Francisco, CA 94104

Account #:

 

325000471314

ABA Routing #:

 

026009593

SWIFT:

 

BOFAUS3N (for overseas transfers)

Account Title:

 

BioPharmX

 

2.              Subscriber Representations, Warranties and Agreements.  The
Subscriber hereby acknowledges, represents and warrants as follows (with the
understanding that the Company will rely on such representations and warranties
in determining, among other matters, the suitability of this investment for the
Subscriber in order to comply with federal and state securities laws):

 

(a)             In connection with this subscription, the Subscriber has read
this Subscription Agreement and the other Offering Documents.  The Subscriber
acknowledges that this Subscription Agreement is not intended to set forth all
of the information which might be deemed pertinent by an investor who is
considering an investment in the Securities.  It being the responsibility of
Subscriber (i) to determine what additional information he desires to obtain in
evaluating this investment and (ii) to obtain such information from the Company.

 

(b)              THIS OFFERING IS LIMITED TO PERSONS WHO ARE “ACCREDITED
INVESTORS,” AS THAT TERM IS DEFINED IN REGULATION D UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”), AND

 

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WHO HAVE THE FINANCIAL MEANS AND THE BUSINESS, FINANCIAL AND INVESTMENT
EXPERIENCE AND ACUMEN TO CONDUCT AN INVESTIGATION AS TO, AND TO EVALUATE, THE
MERITS AND RISKS OF THIS INVESTMENT. THE SUBSCRIBER HEREBY REPRESENTS THAT HE
HAS READ, IS FAMILIAR WITH AND UNDERSTANDS RULE 501 OF REGULATION D UNDER THE
ACT.  THE SUBSCRIBER IS AN “ACCREDITED INVESTOR” AS DEFINED IN RULE 501(A) OF
REGULATION D.

 

(c)                The Subscriber has had full access to all the information
which the Subscriber (or the Subscriber’s advisor) considers necessary or
appropriate to make an informed decision with respect to the Subscriber’s
investment in the Securities.  The Subscriber acknowledges that the Company has
made available to the Subscriber and the Subscriber’s advisors the opportunity
to examine and copy any contract, matter or information which the Subscriber
considers relevant or appropriate in connection with this investment and to ask
questions and receive answers relating to any such matters including, without
limitation, the financial condition, management, employees, business,
obligations, corporate books and records, budgets, business plans of and other
matters relevant to the Company.  To the extent the Subscriber has not sought
information regarding any particular matter, the Subscriber represents that he
or she had and has no interest in doing so and that such matters are not
material to the Subscriber in connection with this investment.  The Subscriber
has accepted the responsibility for conducting the Subscriber’s own
investigation and obtaining for itself such information as to the foregoing and
all other subjects as the Subscriber deems relevant or appropriate in connection
with this investment.  The Subscriber is not relying on any representation other
than that contained herein.  The Subscriber acknowledges that no representation
regarding projected financial performance or a projected rate of return has been
made to it by any party.

 

(d)               The Subscriber understands that the offering of the Securities
has not been registered under the Securities Act, in reliance on an exemption
for private offerings provided pursuant to Section 4(2) of the Securities Act
and that, as a result, the Securities, as well as the securities issuable upon
conversion of the Securities as set forth in the Certificate of Designations and
the Warrants certificate and the  securities issuable in connection with such
securities (collectively, the “Conversion Securities”), will be “restricted
securities” as that term is defined in Rule 144 under the Securities Act and,
accordingly, under Rule 144 as currently in effect, that the Securities or the
Conversion Securities must be held until the latest of (i) at least six
(6) months after the investment has been made (or indefinitely if the Subscriber
is deemed an “affiliate” within the meaning of such rule), or (ii) January 23,
2015, one year from the closing of the reverse acquisition transaction, unless
the Securities or Conversion Securities are subsequently registered under the
Securities Act and qualified under any other applicable securities law or
exemptions from such registration and qualification are available.  The
Subscriber understands that except as set forth in Section 4 hereof the Company
is under no obligation to register the Securities under the Securities Act or to
register or qualify the Securities under any other

 

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applicable securities law, or to comply with any other exemption under the
Securities Act or any other securities law, and that the Subscriber has no right
to require such registration.  The Subscriber further understands that the
Offering of the Securities has not been qualified or registered under any
foreign or state securities laws in reliance upon the representations made and
information furnished by the Subscriber herein and any other documents delivered
by the Subscriber in connection with this subscription; that the Offering has
not been reviewed by the Commission or by any foreign or state securities
authorities; that the Subscriber’s rights to transfer the Securities will be
restricted, which includes restrictions against transfers unless the transfer is
not in violation of the Securities Act and applicable state securities laws
(including investor suitability standards); and that the Company may in its sole
discretion require the Subscriber to provide at Subscriber’s own expense an
opinion of its counsel to the effect that any proposed transfer is not in
violation of the Act or any state securities laws.

 

(e)                The Subscriber is empowered and duly authorized to enter into
this Subscription Agreement which constitutes a valid and binding agreement of
the Subscriber enforceable against the Subscriber in accordance with its terms;
and the person signing this Subscription Agreement on behalf of the Subscriber
is empowered and duly authorized to do so.

 

(f)                 The Subscriber has liquid assets sufficient to assure that
the purchase price of the Securities will cause no undue financial difficulties
and that, after purchasing the Securities the Subscriber will be able to provide
for any foreseeable current needs and possible personal contingencies; the
Subscriber is able to bear the risk of illiquidity and the risk of a complete
loss of this investment.

 

(g)               The information in any documents delivered by the Subscriber
in connection with this subscription, including, but not limited to the Investor
Questionnaire, is true, correct and complete in all respects as of the date
hereof.  The Subscriber agrees promptly to notify the Company in writing of any
change in such information after the date hereof.

 

(h)               The offering and sale of the Securities to the Subscriber were
not made through any advertisement in printed media of general and regular paid
circulation, radio or television or any other form of advertisement, or as part
of a general solicitation.

 

(i)                  The Subscriber recognizes that an investment in the
Securities involves significant risks.  The Subscriber has read and understands
such risks and that such risks, and others, can result in the loss of the
Subscriber’s entire investment in the Securities.

 

(j)                  The Subscriber is acquiring the Securities, as principal,
for the Subscriber’s own account for investment purposes only, and not with a
present intention toward or for the resale, distribution or fractionalization
thereof, and no other person has a beneficial interest in the Securities.  The
Subscriber has no present intention of selling or otherwise distributing or
disposing of the Securities, and understands that an investment in the
Securities must be considered a long-term illiquid investment.

 

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3.              Representations, Warranties and Covenants of the Company.  As a
material inducement of the Subscribers to enter into this Subscription Agreement
and subscribe for the Securities, the Company represents and warrants to the
Subscriber, as of the date hereof, as follows:

 

(a)         Organization and Standing.  The Company is a duly organized
corporation, validly existing and in good standing under the laws of the State
of Delaware, has full power to carry on its business as and where such business
is now being conducted and to own, lease and operate the properties and assets
now owned or operated by it and is duly qualified to do business and is in good
standing in each jurisdiction where the conduct of its business or the ownership
of its properties requires such qualification except where the failure to be so
qualified would not have a Material Adverse Effect on the Company.  “Material
Adverse Effect” means any circumstance, change in, or effect on the Company
that, individually or in the aggregate with any other similar circumstances,
changes in, or effects on, the Company taken as a whole: (i) is, or is
reasonably expected to be, materially adverse to the business, operations,
assets, liabilities, employee relationships, customer or supplier relationships,
prospects, results of operations or the condition (financial or otherwise) of
the Company taken as a whole, or (ii) is reasonably expected to adversely affect
the ability of the Company to operate or conduct the Company’s business in the
manner in which it is currently operated or conducted or proposed to be operated
or conducted by the Company; provided, however, that none of the following shall
be deemed in and of themselves, either alone or in combination, to constitute,
and none of the following shall be taken into account in determining whether
there has been or will be, a Material Adverse Effect: (i) any change, event,
state of facts or development generally affecting the general political,
economic or business conditions of the United States; (ii) any change, event,
state of facts or development generally affecting the medical device industry;
(iii) any change, event, state of facts or development arising from or relating
to compliance with the terms of this Subscription Agreement; (iv) acts of war
(whether or not declared), the commencement, continuation or escalation of a
war, acts of armed hostility, sabotage or terrorism or other international or
national calamity or any material worsening of such conditions; (v) changes in
laws or the U.S. generally accepted accounting principles (“GAAP”) after date
hereof or interpretation thereof; or (vi) any matter set forth in the Offering
Documents or the Schedules or Exhibits thereto.

 

(b)         Subsidiaries.  Except for BiopharmX Inc., a Nevada corporation, as
of the date herein, the Company does not own or control any subsidiaries. For
purposes of this Agreement, “Subsidiary” means, with respect to any entity at
any date, any corporation, limited or general partnership, limited liability
company, trust, estate, association, joint venture or other business entity of
which more than 50% of (i) the outstanding capital stock having (in the absence
of contingencies) ordinary voting power to elect a majority of the board of
directors or other managing body of such entity, (ii) in the case of a
partnership or limited liability company, the interest in the capital or profits
of such partnership or limited liability company or (iii) in the case of a
trust, estate, association, joint venture or other entity, the beneficial
interest in such trust, estate, association or other entity business is, at

 

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the time of determination, owned or controlled directly or indirectly through
one or more intermediaries, by such entity.

 

(c)          Authority.  The execution, delivery and performance of this
Subscription Agreement and the other Offering Documents by the Company and the
consummation of the transactions contemplated hereby have been duly authorized
by the Board of Directors of the Company. Each of the documents contained in the
Offering Documents has been (or upon delivery will be) duly executed by the
Company, is or, when delivered in accordance with the terms hereof, will
constitute, assuming due authorization, execution and delivery by each of the
parties thereto, the valid and binding obligation of the Company enforceable
against the Company in accordance with its terms.

 

(d)         No Conflict.  The execution, delivery and performance of this
Subscription Agreement and the consummation of the transactions contemplated
hereby do not (i) violate or conflict with the Company’s Certificate of
Incorporation, By-laws or other organizational documents, (ii) conflict with or
result (with the lapse of time or giving of notice or both) in a material breach
or default under any material agreement or instrument to which the Company is a
party or by which the Company is otherwise bound, or (iii) violate any order,
judgment, law, statute, rule or regulation applicable to the Company, except
where such violation, conflict or breach would not have a Material Adverse
Effect on the Company.  This Subscription Agreement when executed by the Company
will be a legal, valid and binding obligation of the Company enforceable in
accordance with its terms (except as may be limited by bankruptcy, insolvency,
reorganization, moratorium and similar laws and equitable principles relating to
or limiting creditors’ rights generally).

 

(e)          Authorization.  Issuance of the Securities to Subscriber has been
duly authorized by all necessary corporate actions of the Company.

 

(f)           Litigation and Other Proceedings.  There are no actions, suits,
proceedings or investigations pending or, to the knowledge of the Company,
threatened against the Company at law or in equity before or by any court or
Federal, state, municipal or their governmental department, commission, board,
bureau, agency or instrumentality, domestic or foreign which could materially
adversely affect the Company.  The Company is not subject to any continuing
order, writ, injunction or decree of any court or agency against it which would
have a material adverse effect on the Company.

 

(g)         Use of Proceeds.  The proceeds of this Offering and sale of the
Securities, net of payment of placement expenses, will be used by the Company
for working capital and general corporate purposes.

 

(h)         Consents/Approvals.  No consents, filings (other than Federal and
state securities filings relating to the issuance of the Securities pursuant to
applicable exemptions from registration, which the Company hereby undertakes to
make in a timely fashion), authorizations or other actions of any governmental
authority are required to be obtained or made by the Company for the Company’s
execution, delivery and performance of this

 

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Subscription Agreement which have not already been obtained or made or will be
made in a timely manner following the initial Closing.

 

(i)            Placement Agents.  The Company may engage finders, brokers or
placement agents in connection with the transactions contemplated hereby and pay
to such brokers fees not to exceed ten (10) percent of the gross proceeds of the
Offering and shares of Common Stock representing ten (10) percent of shares of
Common Stock sold in the Offering.

 

(j)            Capitalization. A capitalization table illustrating the
authorized and outstanding capital stock of the Company as of the date hereof is
attached as Schedule 3(j).  All of such outstanding shares have been, or upon
issuance will be, validly issued, fully paid and non-assessable.  As of the date
hereof, except as disclosed in Schedule 3(j), and except for Securities issued
in the Offering (i) no shares of the Company’s capital stock are subject to
preemptive rights or any other similar rights or any liens or encumbrances
suffered or permitted by the Company, (ii) there are no outstanding debt
securities, (iii) there are no outstanding options, warrants, scrip, rights to
subscribe to, calls or commitments of any character whatsoever relating to, or
securities or rights convertible into, any shares of capital stock of the
Company or any of its subsidiaries, or contracts, commitments, understandings or
arrangements by which the Company or any of its subsidiaries is or may become
bound to issue additional shares of capital stock of the Company or any of its
subsidiaries or options, warrants, scrip, rights to subscribe to, calls or
commitments of any character whatsoever relating to, or securities or rights
convertible into, any shares of capital stock of the Company or any of its
subsidiaries, (iv) except for its obligations under Section 4 of this Agreement,
there are no agreements or arrangements under which the Company or any of its
subsidiaries is obligated to register the sale of any of their securities under
the Securities Act, (v) there are no outstanding securities of the Company or
any of its subsidiaries which contain any redemption or similar provisions, and
there are no contracts, commitments, understandings or arrangements by which the
Company or any of its subsidiaries is or may become bound to redeem a security
of the Company or any of its subsidiaries, and (vi) there are no securities or
instruments containing anti-dilution or similar provisions that will be
triggered by the issuance or exercise of the Securities as described in this
Subscription Agreement.  The Company has furnished to the Subscriber true and
correct copies of the Company’s Certificate of Incorporation, as amended and as
in effect on the date hereof (the “Certificate of Incorporation”), and the
Company’s By-laws, as in effect on the date hereof (the “By-laws”), and the
terms of all securities convertible or exchangeable into or exercisable for
Common Stock and the material rights of the holders thereof in respect thereto. 
Schedule 3(j) also lists all outstanding debt of the Company with sufficient
detail acceptable to Subscriber.

 

(k)         Intellectual Property Rights. The Company owns or possesses adequate
rights or licenses to use all trademarks, trade names, service marks, service
mark registrations, service names, patents, patent rights, copyrights,
inventions, licenses, approvals, governmental authorizations, trade secrets and
rights necessary to conduct its businesses as now conducted.  The Company does
not have any knowledge of any infringement by the Company of trademark, trade
name rights, patents, patent rights, copyrights, inventions,

 

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licenses, service names, service marks, service mark registrations, trade secret
or other similar rights of others, or of any such development of similar or
identical trade secrets or technical information by others and there is no
claim, action or proceeding being made or brought against, or to the Company’s
knowledge, being threatened against, the Company regarding trademarks, trade
name rights, patents, patent rights, inventions, copyrights, licenses, service
names, service marks, service mark registrations, trade secrets or other
infringement.

 

(l)            Disclosure. No representation or warranty by the Company in this
Subscription Agreement, the other Offering Documents, nor in any certificate,
Schedule or Exhibit delivered or to be delivered pursuant to this Subscription
Agreement or the other Offering Documents: contains or will contain any untrue
statement of material fact or omits or will omit to state a material fact
necessary to make the statements contained herein or therein not misleading.  To
the knowledge of the Company at the time of the execution of this Subscription
Agreement and at each Closing, there is no information concerning the Company
which has not heretofore been disclosed to the Subscribers that would have a
Material Adverse Effect.

 

(m)     Title.  The Company has good and marketable title to all personal
property owned by it which is material to the business of the Company, in each
case free and clear of all liens, encumbrances and defects.

 

(n)         Tax Status.  The Company has made or filed all United States federal
and state income and all other tax returns, reports and declarations required by
any jurisdiction to which it is subject and all such returns, reports and
declarations are true, correct and accurate in all material respects.  The
Company has paid all taxes and other governmental assessments and charges, shown
or determined to be due on such returns, reports and declarations, except those
being contested in good faith, for which adequate reserves have been
established, in accordance with GAAP, and except where the failure to do so
would not constitute a Material Adverse Effect on the Company.

 

(o)         Compliance with Laws. The business of the Company has been and is
presently being conducted so as to comply with all applicable material federal,
state and local governmental laws, rules, regulations and ordinances.

 

(p)         Restrictions on Business Activities.  There is no judgment, order,
decree, writ or injunction binding upon the Company or any subsidiary or, to the
knowledge of the Company or any subsidiary, threatened that has or could
prohibit or impair the conduct of their respective businesses as currently
conducted or any business practice of the Company or any subsidiary, including
the acquisition of property, the provision of services, the hiring of employees
or the solicitation of clients, in each case either individually or in the
aggregate.

 

(r)          Issuances. The Company’s common stock issuable upon conversion of
the Shares and exercise of Warrants will be validly issued, fully paid and
nonassessable.

 

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(s)           USA PATRIOT Act and Money Laundering Laws. The operations of the
Company are and have been conducted at all times in compliance with the money
laundering requirements of all applicable governmental authorities and any
related or similar rules, regulations or guidelines, issued, administered or
enforced by any governmental authority (collectively, the “Money Laundering
Laws”) and the Uniting and Strengthening America by Providing Appropriate Tools
Required to Intercept and Obstruct Terrorism Act of 2001 (Title III of Pub. L.
107-56 (signed into Law October 26, 2001) (the “USA PATRIOT Act”) and no action,
suit or proceeding by or before any court or governmental authority or any
arbitrator involving any of the Company or any of its Subsidiaries with respect
to the Money Laundering Laws or USA PATRIOT Act is pending or, to the best
knowledge of the Company, threatened.

 

(t)            For twelve months after the Closing, the Subscribers that have
subscribed for at least $500,000 of the Shares shall have the right to purchase
on a pro-rata basis up to an aggregate of 50% of the securities offered by the
Company in any subsequent offering (the “Follow-On Financing”) upon the same
terms as offered to all other offerees. The Subscribers shall be given not less
than ten days prior written notice (the “Notice of Sale”) of any proposed
Follow-On Financing and shall have the right during the ten days following
receipt of the Notice of Sale to purchase the securities offered in the
Follow-On Financing.

 

(u)         Within 12 months after the first Closing, the Company shall increase
the number of the directors of the Company to 5, including the current
directors, and the Board of Directors shall appoint at least one director
qualifying as an audit committee financial expert, as defined in Item
407(d)(5)(i) of Regulation S-K, and two directors qualifying as independent
directors pursuant to the definition of “independent director” under the
Rules of NASDAQ, Marketplace Rule 5605(a)(2).

 

(v)         For sixty (60) days after the date hereof, upon any issuance by the
Company or any of its subsidiaries of any security with any term more favorable
to the holder of such security or with a term in favor of the holder of such
security that was not similarly provided to the Subscriber, the Company shall
notify the Subscriber of such additional or more favorable term and such term,
at Subscriber’s option, shall become a part of the transaction documents with
the Subscriber.  The types of terms contained in another security that may be
more favorable to the holder of such security shall not include any rights to
representation on the Company’s board of directors.

 

(W) The Subscribers shall purchase $2,000,000 of the Shares at the per share
price of $1.85 upon the earlier of the Company receiving revenues for Violet of
$2,000,000 (the “Milestone”) or upon immediate up listing to the NYSE or NASDAQ
exchange, provided that the Subscribers will have no rights to receive Warrants
in connection with the purchase of such Shares. Within ten (10) business days
after the written notice of the Milestone is provided by the Company, the
Subscribers shall remit funds to the Company for the $2,000,000 of Shares.

 

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Section 4.                                          Registration Rights.

 

(a)               Registration Rights.

 

(i)                 If at any time following the approval of the Common Stock
for listing on the NASDAQ or NYSE, (a) there is no effective Registration
Statement with respect to shares of Common Stock underlying the Series A
Preferred Stock and the Warrant Shares (the “Registrable Shares”) and (b) not
all of the outstanding Registrable Shares may be sold without registration
pursuant to Rule 144 under the Securities Act, then Subscribers that at the time
of the written demand (directly or with their affiliates) hold the Registrable
Shares representing more than 50% of the Registrable Shares then outstanding
(individually, a “Demanding Holder” and collectively, the “Demanding Holders”),
may make a written demand for registration (a “Demand Registration” and the
registration statement to be filed pursuant to such Demand Registration, the
“Demand Registration Statement”) under the Securities Act of the sale of all or
part of its Registrable Shares. Any request for a Demand Registration shall
specify the number of shares (or other amount) of Registrable Shares proposed to
be sold and the intended method(s) of distribution thereof (such written demand,
the “Demand Notice”). The Company will notify the Subscribers other than the
Demanding Holder of the Demand Registration (each such Holder including Shares
of its Registrable Shares in such registration, a “Participating Holder”) as
soon as practicable, and each such other Holder who wishes to include all or a
portion of its Registrable Shares of the type that are the subject of the Demand
Registration Statement proposed to be filed in such Demand Registration
Statement shall so notify the Company within fifteen (15) days after receipt of
such notice (the “Demanding Subscribers’ Deadline”).  The Company shall use its
best efforts to file such Demand Registration Statement within forty five (45)
days (the “Required Filing Date”) after receiving the Demand Notice, and use its
best efforts to have the Demand Registration Statement declared effective by the
U.S. Securities and Exchange Commission, not later than ninety (90) days after
the Required Filing Date. The Company shall not be obligated to effect more than
two (2) Demand Registrations under this Section 4(a) in respect of Registrable
Shares.

 

(ii)             The Company will pay all expenses associated with the
registration, including, without limitation, filing and printing fees,
accounting fees and expenses, costs, if any, associated with clearing the
Registrable Securities for sale under applicable state securities laws.

 

(b)               Subscriber Information. Each Subscriber shall (A) furnish to
the Company such information regarding itself, the Registrable Securities, other
securities of the Company held by it and the intended method of disposition of
the Registrable Securities held by it, as shall be reasonably requested by the
Company to effect and maintain the effectiveness of the Registration Statement,
(B) execute such documents in connection with the Registration Statement as the
Company may reasonably request and (C) immediately

 

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discontinue disposition of Registrable Securities pursuant to any registration
statement upon notice from the Company of (x) the issuance of any stop order or
other suspension of effectiveness of the Registration Statement by the
Commission, or the suspension of the qualification of any of the Registrable
Securities for sale in any jurisdiction by the applicable regulatory authorities
or (y) the happening of any event, as promptly as practicable after becoming
aware of such event, as a result of which the prospectus included in the
Registration Statement, as then in effect, includes an untrue statement of a
material fact or omission to state a material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading or (z) the failure of the prospectus
included in the Registration Statement, as then in effect, to comply with the
requirements of the Securities Act until the Subscriber’s receipt of a
supplemented or amended prospectus or receipt of notice that no supplement or
amendment is required.

 

(c)                Indemnification.

 

(i)                  In the event any Registrable Securities are included in the
Registration Statement under this Section 4, to the extent permitted by law, the
Company will indemnify and hold harmless each of the Subscribers (including
their officers, directors, members and partners), any underwriter (as defined in
the Securities Act) for the Subscribers and each person, if any, who controls
such Subscriber or underwriter within the meaning of the Securities Act or the
Exchange Act (each a “Subscriber Indemnified Person”), against any losses,
claims, damages, or liabilities (joint or several) to which they may become
subject under the Securities Act, the Exchange Act or other federal or state law
(“Claims”), insofar as such losses, claims, damages, or liabilities (or actions
in respect thereof) arise out of or are based upon any of the following
statements, omissions or violations (collectively a “Violation”): (i) any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement, including any preliminary prospectus or final prospectus
contained therein or any amendments or supplements thereto, (ii) the omission or
alleged omission to state therein a material fact required to be stated therein,
or necessary to make the statements therein not misleading, or (iii) any
violation or alleged violation by the Company of the Securities Act, the
Exchange Act, any state securities law or any rule or regulation promulgated
under the Securities Act, the Exchange Act or any state securities law; and the
Company will pay to the Subscriber Indemnified Person, as incurred, any legal or
other expenses reasonably incurred by them in connection with investigating or
defending any Claim; provided, however, that the indemnity agreement contained
in this Section 4 shall not apply to amounts paid in settlement of any such
Claim if such settlement is effected without the consent of the Company (which
consent shall not be unreasonably withheld or delayed), nor shall the Company be
liable to any Subscriber Indemnified Person for any such Claim to the extent
that it arises out of or is based upon a Violation which occurs in reliance upon
and in conformity with written information furnished expressly for use in
connection with such registration by the Subscriber Indemnified Person. Such
indemnity shall remain in full force and effect regardless of any investigation
made by or on behalf of

 

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such Subscriber Indemnified Person and shall survive the transfer of the
Registrable Securities by the Subscribers.

 

(ii)              In the event any Registrable Securities are included in the
Registration Statement under this Section 4 to the extent permitted by law, each
Subscriber shall, severally and not jointly, indemnify, hold harmless and
defend, to the same extent and in the same manner as is set forth in Section 4,
the Company, each of its directors, each of its officers who signs the
registration statement and each Person, if any, who controls the Company within
the meaning of the Securities Act or the Securities Exchange Act  of 1934, as
amended (the “Exchange Act”), (each, a “Company Indemnified Person”), against
any Claim, insofar as such Claims arise out of or are based upon any Violation,
in each case to the extent, and only to the extent, that such Violation occurs
in reliance upon and in strict conformity with written information furnished to
the Company by such Subscriber expressly for use in the Registration Statement;
and, subject to Section 4, such Subscriber will reimburse any legal or other
expenses reasonably incurred by any Company Indemnified Person in connection
with investigating or defending any such Claim; provided, however, that the
indemnity agreement contained in this Section 4 shall not apply to amounts paid
in settlement of any Claim if such settlement is effected without the prior
written consent of the indemnifying Subscriber, which consent shall not be
unreasonably withheld or delayed. Such indemnity shall remain in full force and
effect regardless of any investigation made by or on behalf of such Company
Indemnified Person and shall survive the transfer of the Registrable Securities
by the Subscribers.

 

(iii)          Promptly after receipt by a Subscriber Indemnified Person or
Company Indemnified Person (each, an “Indemnified Person”) under this Section 4
of notice of a Claim, such Indemnified Person shall, if a Claim in respect
thereof is to be made against any indemnifying party under this Section 4,
deliver to the indemnifying party a written notice of the commencement thereof,
and the indemnifying party shall, by giving written notice to the Indemnified
Party within fifteen days after the Indemnified Party has given notice of the
Claim, have the right to participate in, and, to the extent the indemnifying
party so desires, jointly with any other indemnifying party similarly noticed,
to assume control of the defense thereof with counsel mutually satisfactory to
the indemnifying party and the Indemnified Person; provided, however, that an
Indemnified Person shall have the right to retain its own counsel with the fees
and expenses of not more than one counsel for such Indemnified Person to be paid
by the indemnifying party, if, in the reasonable opinion of counsel retained by
the indemnifying party, the representation by such counsel of the Subscriber
Indemnified Person or Company Indemnified Person and the indemnifying party
would be inappropriate due to actual or potential differing interests between
such Indemnified Person and any other party represented by such counsel in such
proceeding. In the case of any Company Indemnified Person, legal counsel
referred to in the proviso of the immediately preceding sentence shall be
selected by the holders holding at least a majority in interest of the
Registrable Securities included in the registration statement to which the Claim
relates. The Indemnified Person shall cooperate fully with the indemnifying
party in connection with any negotiation or defense of any such action

 

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or Claim by the indemnifying party and shall furnish to the indemnifying party
all information reasonably available to the Indemnified Person that relates to
such action or Claim. The indemnifying party shall keep the Indemnified Person
reasonably apprised at all times as to the status of the defense or any
settlement negotiations with respect thereto. No indemnifying party shall be
liable for any settlement of any action, claim or proceeding effected without
its prior written consent, provided, however, that the indemnifying party shall
not unreasonably withhold, delay or condition its consent. No indemnifying party
shall, without the prior written consent of the Indemnified Person, consent to
entry of any judgment or enter into any settlement or other compromise that does
not include as an unconditional term thereof the giving by the claimant or
plaintiff to such Indemnified Person of a full and general release from all
liability in respect to such Claim or litigation, and such settlement (a) shall
provide for the payment by the Indemnifying Party of money as sole relief for
the claimant, (b) shall not include any finding or admission as to fault on the
part of the Indemnified Person and (c) shall have no effect on any other claims
that may be made against the Indemnified Party.

 

Following indemnification as provided for hereunder, the indemnifying party
shall be subrogated to all rights of the Indemnified Person with respect to all
third parties, firms or corporations relating to the matter for which
indemnification has been made. The failure to deliver written notice to the
indemnifying party within a reasonable time of the commencement of any such
action shall not relieve such indemnifying party of any liability to the
Indemnified Person under this Section 4, except to the extent that the
indemnifying party is materially prejudiced in its ability to defend such
action.

 

5.              Legends.  The Subscriber understands and agrees that the Company
will cause any necessary legends to be placed upon any instruments(s) evidencing
ownership of the Securities, together with any other legend that may be required
by federal or state securities laws or deemed necessary or desirable by the
Company.

 

6.              General Provisions.

 

(a)               Confidentiality.  The Subscriber covenants and agrees that it
will keep confidential and will not disclose or divulge any confidential or
proprietary information that such Subscriber may obtain from the Company
pursuant to financial statements, reports, and other materials submitted by the
Company to such Subscriber in connection with this offering or as a result of
discussions with or inquiry made to the Company, unless such information is
known, or until such information becomes known, to the public through no action
by the Subscriber; provided, however, that a Subscriber may disclose such
information (i) to its attorneys, accountants, consultants, and other
professionals to the extent necessary in connection with his or her investment
in the Company so long as any such professional to whom such information is
disclosed is made aware of the Subscriber’s obligations hereunder and such
professional agrees to be likewise bound as though such professional were a
party hereto, (ii) if such information becomes generally

 

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available to the public through no fault of the Subscriber, or (iii) if such
disclosure is required by applicable law or judicial order.

 

(b)               Successors.  The covenants, representations and warranties
contained in this Subscription Agreement shall be binding on the Subscriber’s
and the Company’s heirs and legal representatives and shall inure to the benefit
of the respective successors and assigns of the Company.  The rights and
obligations of this Subscription Agreement may not be assigned by any party
without the prior written consent of the other party.

 

(c)                Counterparts.  This Agreement may be executed in
counterparts, each of which shall be deemed an original agreement, but all of
which together shall constitute one and the same instrument.

 

(d)               Execution by Facsimile.  Execution and delivery of this
Agreement by facsimile transmission (including the delivery of documents in
Adobe PDF format) shall constitute execution and delivery of this Agreement for
all purposes, with the same force and effect as execution and delivery of an
original manually signed copy hereof.

 

(e)                Governing Law and Jurisdiction.  This Subscription Agreement
shall be governed by and construed in accordance with the laws of the State of
New York applicable to contracts to be wholly performed within such state and
without regard to conflicts of laws provisions.  Any legal action or proceeding
arising out of or relating to this Subscription Agreement and/or the other
Offering Documents may be instituted in the courts of the State of New York
sitting in New York County or in the United States of America for the Southern
District of New York, and the parties hereto irrevocably submit to the
jurisdiction of each such court in any action or proceeding.  Subscriber hereby
irrevocably waives and agrees not to assert, by way of motion, as a defense, or
otherwise, in every suit, action or other proceeding arising out of or based on
this Subscription Agreement and/or the other Offering Documents and brought in
any such court, any claim that Subscriber is not subject personally to the
jurisdiction of the above named courts, that Subscriber’s property is exempt or
immune from attachment or execution, that the suit, action or proceeding is
brought in an inconvenient forum or that the venue of the suit, action or
proceeding is improper.

 

(f)                       (i)             Indemnification Generally.  The
Company, on the one hand, and the Subscriber, on the other hand (for the purpose
of this Section 6(f) only, each an “Indemnifying Party”), shall indemnify the
other from and against any and all losses, damages, liabilities, claims,
charges, actions, proceedings, demands, judgments, settlement costs and expenses
of any nature whatsoever (including, without limitation, reasonable attorneys’
fees and expenses) resulting from any breach of a representation and warranty,
covenant or agreement by the Indemnifying Party and all claims, charges, actions
or proceedings incident to or arising out of the foregoing.  Notwithstanding any
provision herein to the contrary, the indemnification obligation of any
Subscriber shall be limited to the investment amount in the Shares purchased

 

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by said Subscriber, except to the extent that such indemnification obligation
relates to a breach of Section 2(b).

 

(ii)          Indemnification Procedures.  Each person entitled to
indemnification under this Section 6 (for the purpose of this Section 6(f) only,
an “Indemnified Party”) shall give notice as promptly as reasonably practicable
to each party required to provide indemnification under this Section 6 of any
action commenced against or by it in respect of which indemnity may be sought
hereunder, but failure to so notify an Indemnifying Party shall not release such
Indemnifying Party from any liability that it may have, otherwise than on
account of this indemnity agreement so long as such failure shall not have
materially prejudiced the position of the Indemnifying Party.  Upon such
notification, the Indemnifying Party shall assume the defense of such action if
it is a claim brought by a third party, and, if and after such assumption, the
Indemnifying Party shall not be entitled to reimbursement of any expenses
incurred by it in connection with such action except as described below.  In any
such action, any Indemnified Party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
such Indemnified Party unless (i) the Indemnifying Party and the Indemnified
Party shall have mutually agreed to the contrary or (ii) the named parties in
any such action (including any impleaded parties) include both the Indemnifying
Party and the Indemnified Party and representation of both parties by the same
counsel would be inappropriate due to actual or potential differing or
conflicting interests between them.  The Indemnifying Party shall not be liable
for any settlement of any proceeding effected without its written consent (which
shall not be unreasonably withheld or delayed by such Indemnifying Party), but
if settled with such consent or if there be final judgment for the plaintiff,
the Indemnifying Party shall indemnify the Indemnified Party from and against
any loss, damage or liability by reason of such settlement or judgment.

 

g.                    Notices.  All notices, requests, demands, claims and other
communications hereunder shall be in writing and shall be delivered by certified
or registered mail (first class postage pre-paid), guaranteed overnight
delivery, or facsimile transmission if such transmission is confirmed by
delivery by certified or registered mail (first class postage pre-paid) or
guaranteed overnight delivery, to the following addresses and facsimile numbers
(or to such other addresses or facsimile numbers which such party shall
subsequently designate in writing to the other party):

 

(i)                         if to the Issuer:

 

BioPharmX Corporation

1098 Hamilton Court

Menlo Park, California 94025

Attn: Mr. James Pekarsky

Facsimile: (650) 900-4130

 

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(ii)                      if to the Subscriber to the address set forth next to
its name on the signature page hereto.

 

h.                    Entire Agreement.  This Subscription Agreement (including
the Exhibits attached hereto) and other Offering Documents delivered at  a
Closing pursuant hereto, contain the entire understanding of the parties in
respect of its subject matter and supersede all prior agreements and
understandings between or among the parties with respect to such subject
matter.  The Exhibits constitute a part hereof as though set forth in full
above.

 

i.                       Amendment; Waiver.  This Subscription Agreement may not
be modified, amended, supplemented, canceled or discharged, except by written
instrument executed by the Company and the holders of not less than a majority
of the Shares at the time such consent is sought.  No failure to exercise, and
no delay in exercising, any right, power or privilege under this Subscription
Agreement shall operate as a waiver, nor shall any single or partial exercise of
any right, power or privilege hereunder preclude the exercise of any other
right, power or privilege.  No waiver of any breach of any provision shall be
deemed to be a waiver of any proceeding or succeeding breach of the same or any
other provision, nor shall any waiver be implied from any course of dealing
between the parties.  No extension of time for performance of any obligations or
other acts hereunder or under any other agreement shall be deemed to be an
extension of the time for performance of any other obligations or any other
acts.  The rights and remedies of the parties under this Subscription Agreement
are in addition to all other rights and remedies, at law or equity, that they
may have against each other.

 

j.                       No Impairment.  At all times after the date hereof, the
Company will not take or permit any action, or cause or permit any subsidiary to
take or permit any action that materially impairs or adversely affects the
rights of the Subscribers under the this Agreement or any of the other Offering
Documents.

 

[SIGNATURE PAGES FOLLOW]

 

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IN WITNESS WHEREOF, the Company has executed this Subscription Agreement as of
the date first written above.

 

 

 

BIOPHARMX CORPORATION

 

 

 

By:

/s/ James Pekarsky

 

Name:

James Pekarsky

 

Title:

Chief Executive Officer

 

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SIGNATURE PAGE TO SUBSCRIPTION AGREEMENT

 

INFORMATION IN RESPONSE TO THIS SECTION WILL BE KEPT STRICTLY CONFIDENTIAL

 

DOLLAR AMOUNT INVESTED:  $1,000,000 UPON SIGNING, $2,000,000 UPON MEETING THE
MILESTONE IN SECTION 3 (W)

 

NUMBER OF SHARES:  540,541 UPON SIGNING, 1,081,082 UPON MILESTONE IN SECTION 3
(W)

 

NUMBER OF WARRANTS: 270,27O UPON SIGNING

 

NAME IN WHICH SHARES AND WARRANT SHOULD BE ISSUED: KIP OVERSEAS EXPANSION
PLATFORM FUND

 

AMOUNT INVESTED TO BE SENT VIA:

 

o Check (enclosed)

 

x Wire

 

Address Information

 

For individual subscribers this address should be the Subscriber’s primary legal
residence.  For entities other than individual subscribers, please provide
address information for the entities primary place of business.  Information
regarding a joint subscriber should be included in the column at right.

 

10F ASEM Tower, 517 Yeongdong-daero

 

 

Legal Address

 

Legal Address

 

 

 

Gangnam-gu, Seoul, 135-798 Republic of Korea

 

 

City, State, and Zip Code, Country

 

City, State, and Zip Code, Country

 

Alternate Address Information

 

Subscribers who wish to receive correspondence at an address other than the
address listed above should complete the Alternate Address section on the
following page.

 

 

                           N/A

 

 

 

Tax ID # or Social Security #

 

Tax ID # or Social Security #

 

AGREED AND SUBSCRIBED

AGREED AND SUBSCRIBED

This 24th day of October, 2014

SIGNATURE OF JOINT SUBSCRIBER (if any)

 

 

By:

/s/ Baek Yer Hyun

 

This      day of                                             , 2014

Name:  Baek Yer Hyun

By:

 

Title (if any):

Name:

 

Title (if any):

KIP Overseas Expansion Platform Fund

 

Subscriber Name (Typed or Printed)

Additional Subscriber Name (Typed or Printed)

 

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ACCEPTED:

 

 

 

BIOPHARMX CORPORATION

 

 

 

 

 

By:

/s/ James Pekarsky

 

Name:

James Pekarsky

 

Title:

Chief Executive Officer

 

 

 

 

 

Date of Acceptance:

October 24, 2014

 

 

Alternate Address Information (if applicable)

 

 

 

 

 

 

 

Alternate Address for Correspondence

 

Alternate Address for Correspondence

 

 

 

 

 

 

 

 

City, State and Zip Code

 

City, State and Zip Code

 

 

 

 

 

 

 

 

Telephone

 

Telephone

 

 

 

 

 

 

 

 

Facsimile

 

Facsimile

 

 

 

 

 

 

 

 

Tax ID # or Social Security #

 

Tax ID # or Social Security #

 

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CERTIFICATE OF SIGNATORY

 

(To be completed if the Shares are

being subscribed for by an entity)

 

I, Baek Yer Hyun , am the CEO of KIP Overseas Expansion Platform Fund (the
“Entity”).

 

I certify that I am empowered and duly authorized by the Entity to execute and
carry out the terms of the Subscription Agreement and to purchase and hold the
Shares, and certify further that the Subscription Agreement has been duly and
validly executed on behalf of the Entity and constitutes a legal and binding
obligation of the Entity.

 

IN WITNESS WHEREOF, I have set my hand this 24th day of October, 2014.

 

 

 

/s/ Baek Yer Hyun

 

(Signature)

 

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