Exhibit 10.9

REGISTRATION RIGHTS AGREEMENT

This Registration Rights Agreement (this “Agreement”) is made and entered into
as of March 15, 2017, among Aerpio Pharmaceuticals, Inc., a Delaware corporation
(the “Company”), and each of the investors listed on Schedule A hereto (each of
which is referred to in this Agreement as an “Investor” and collectively, the
“Investors”).

RECITALS:

WHEREAS, on the date hereof, a wholly-owned subsidiary of the Company will merge
(the “Merger”) with and into Aerpio Therapeutics, Inc., a Delaware corporation
(“Aerpio”);

WHEREAS, following the Merger, Aerpio will convert into a Delaware limited
liability company (the “LLC Conversion”);

WHEREAS, following the LLC conversion, the Company will offer and sell in a
private placement offering (the “Offering”) shares of the common stock of the
Company, par value $0.0001 per share;

WHEREAS, the Company has entered into a registration rights agreement with each
of the purchasers in the Offering and certain other parties thereto; and

WHEREAS, the Company wishes to enter into a second registration rights agreement
with the parties hereto, who were certain of the existing Investors of Aerpio
prior to the Merger and LLC Conversion;

NOW, THEREFORE, in consideration of the mutual promises, representations,
warranties, covenants, and conditions set forth herein, the parties mutually
agree as follows:

 

  1. Definitions. For purposes of this Agreement:

“Affiliate” means, (i) with respect to any specified Person, any other Person
who, directly or indirectly, controls, is controlled by, or is under common
control with such Person, including without limitation any general partner,
managing member, officer or director of such Person or any venture capital fund
now or hereafter existing that is controlled by one or more general partners or
managing members of, or shares the same management company with, such Person,
and (ii) without limiting the generality of the foregoing, with respect to any
Satter Investor, any trust or other entity for which Muneer A. Satter or Kristen
H. Hertel serves as trustee or investment advisor, any Immediate Family Member
of Muneer A. Satter and any trust or other entity for the benefit of any
Immediate Family Member of Muneer A. Satter.

“Common Stock” means shares of the Company’s common stock, par value $0.0001 per
share.

“Damages” means any loss, damage, or liability (joint or several) to which a
party hereto may become subject under the Securities Act, the Exchange Act, or
other federal or state law, insofar as such loss, damage, or liability (or any
action in respect thereof) arises out of or is

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based upon (i) any untrue statement or alleged untrue statement of a material
fact contained in any registration statement of the Company, including any
preliminary prospectus or final prospectus contained therein or any amendments
or supplements thereto; (ii) an 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
indemnifying party (or any of its agents or Affiliates) 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.

“Derivative Securities” means any securities or rights convertible into, or
exercisable or exchangeable for (in each case, directly or indirectly), Common
Stock, including options and warrants.

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder.

“Excluded Registration” means (i) a registration relating to the sale of
securities to employees of the Company or a subsidiary pursuant to a stock
option, stock purchase, or similar plan; (ii) a registration relating to an SEC
Rule 145 transaction; (iii) a registration on any form that does not include
substantially the same information as would be required to be included in a
registration statement covering the sale of the Registrable Securities; or
(iv) a registration in which the only Common Stock being registered is Common
Stock issuable upon conversion of debt securities that are also being
registered.

“Form S-1” means such form under the Securities Act as in effect on the date
hereof or any successor registration form under the Securities Act subsequently
adopted by the SEC.

“Form S-3” means such form under the Securities Act as in effect on the date
hereof or any registration form under the Securities Act subsequently adopted by
the SEC that permits incorporation of substantial information by reference to
other documents filed by the Company with the SEC.

“Holder” means any holder of Registrable Securities who is a party to this
Agreement.

“Immediate Family Member” means a child, stepchild, grandchild, parent,
stepparent, grandparent, spouse, sibling, mother-in-law, father-in-law,
son-in-law, daughter-in-law, brother-in-law, or sister-in-law, including
adoptive relationships, of a natural person referred to herein.

“Initiating Holders” means, collectively, Holders who properly initiate a
registration request under this Agreement.

“Investor” means the persons named on Schedule A hereto; provided, however, that
any such person shall cease to be considered an Investor for purposes of this
Agreement at any time such person and his, her or its Affiliates collectively
hold no shares of Common Stock.

“Person” means any individual, corporation, partnership, trust, limited
liability company, association or other entity.

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“Registrable Securities” means (i) any Common Stock held by the Investors as of
the date hereof (including any Common Stock acquired by the Investors in the
Offering); and (ii) any Common Stock issued as a dividend or other distribution
with respect to or in exchange for or in replacement of, the shares referenced
in clause (i) above; excluding in all cases, however, any Registrable Securities
sold by a Person in a transaction in which the applicable rights under this
Agreement are not assigned pursuant to Section 3.1, and excluding for purposes
of Section 2 any shares for which registration rights have terminated pursuant
to Section 2.13 of this Agreement.

“Restricted Securities” means the securities of the Company, if any, required to
bear the legend set forth in Section 2.12(b) hereof.

“Satter Investors” means each of Muneer A. Satter Revocable Trust, The Satter
Foundation, SIM - SCT Investment Holdings, LLC, SIM - SFT Investment Holdings,
LLC, Muneer A. Satter IRA, SIM - KHH Investment Holdings, LLC, SIM - RSFIT
Investment Holdings, LLC, SIM - RHSIT Investment Holdings, LLC, SIM - ACWIT
Investment Holdings, LLC, SIM - GBAHIT Investment Holdings, LLC, Abdus Satter
Insurance Trust and Satter Medical Technology Partners, L.P.

“SEC” means the Securities and Exchange Commission.

“SEC Rule 144” means Rule 144 promulgated by the SEC under the Securities Act.

“SEC Rule 145” means Rule 145 promulgated by the SEC under the Securities Act.

“Securities Act” means the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder.

“Selling Expenses” means all underwriting discounts, selling commissions, and
stock transfer taxes applicable to the sale of Registrable Securities, and fees
and disbursements of counsel for any Holder, except for the fees and
disbursements of the Selling Holder Counsel borne and paid by the Company as
provided in Section 2.6.

 

  2. Registration Rights. The Company covenants and agrees as follows:

 

  2.1 Demand Registration.

(a) Form S-1 Demand. If at any time after the expiration or termination of the
registration statement(s) (the “Offering Registration Statement(s)”) filed or to
be filed by the Company under the Registration Rights Agreement, dated as of
March 15, 2017, among the Company and the parties thereto, the Company receives
a request from Holders of thirty percent (30%) of the Registrable Securities
then outstanding that the Company file a Form S-1 registration statement with
respect to Registrable Securities then outstanding if the Company is not then
eligible to use a Form S-3 registration statement, then the Company shall
(i) within ten (10) days after the date such request is given, give notice
thereof (the “Demand Notice”) to all Holders other than the Initiating Holders;
and (ii) as soon as practicable, and in any event within sixty (60) days after
the date such request is given by the Initiating Holders, file

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a Form S-1 registration statement under the Securities Act covering all
Registrable Securities that the Initiating Holders requested to be registered
and any additional Registrable Securities requested to be included in such
registration by any other Holders, as specified by notice given by each such
Holder to the Company within ten (10) days of the date the Demand Notice is
given, and in each case, subject to the limitations of Sections 2.1(c) and 2.3.

(b) Form S-3 Demand. If at any time after the expiration or termination of the
Offering Registration Statement(s), when it is eligible to use a Form S-3
registration statement, the Company receives a request from Holders of at least
twenty percent (20%) of the Registrable Securities then outstanding that the
Company file a Form S-3 registration statement with respect to outstanding
Registrable Securities of such Holders (which may be offered on a delayed or
continuous basis pursuant to Rule 415 of the Securities Act if requested by such
Holders), then the Company shall (i) within ten (10) days after the date such
request is given, give a Demand Notice to all Holders other than the Initiating
Holders; and (ii) as soon as practicable, and in any event within forty-five
(45) days after the date such request is given by the Initiating Holders, file a
Form S-3 registration statement under the Securities Act covering all
Registrable Securities requested to be included in such registration by any
other Holders, as specified by notice given by each such Holder to the Company
within ten (10) days of the date the Demand Notice is given, and in each case,
subject to the limitations of Sections 2.1(c) and 2.3.

(c) Notwithstanding the foregoing obligations, if the Company furnishes to
Holders requesting a registration pursuant to this Section 2(a) a certificate
signed by the Company’s chief executive officer stating that in the good faith
judgment of the Company’s Board of Directors it would be materially detrimental
to the Company and its stockholders for such registration statement to either
become effective or remain effective for as long as such registration statement
otherwise would be required to remain effective, because such action would
(i) materially interfere with a significant acquisition, corporate
reorganization, or other similar transaction involving the Company; (ii) require
premature disclosure of material information that the Company has a bona fide
business purpose for preserving as confidential; or (iii) render the Company
unable to comply with requirements under the Securities Act or Exchange Act,
then the Company shall have the right to defer taking action with respect to
such filing, and any time periods with respect to filing or effectiveness
thereof shall be tolled correspondingly, for a period of not more than sixty
(60) days after the request of the Initiating Holders is given; provided,
however, that the Company may not invoke this right more than once in any twelve
(12) month period; and provided, further, that the Company shall not register
any securities for its own account or that of any other stockholder during such
sixty (60) day period other than an Excluded Registration.

(d) The Company shall not be obligated to effect, or to take any action to
effect, any registration pursuant to Section 2.1(a)(i) during the period that is
sixty (60) days before the Company’s good faith estimate of the date of filing
of, and ending on a date that is one hundred eighty (180) days after the
effective date of, a Company-initiated registration, provided, that the Company
is actively employing in good faith commercially reasonable efforts to cause
such registration statement to become effective; (ii) after the Company has
effected two registrations pursuant to Section 2.1(a); or (iii) if the
Initiating Holders propose to dispose of

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shares of Registrable Securities that may be immediately registered on Form S-3
pursuant to a request made pursuant to Section 2.1(b). The Company shall not be
obligated to effect, or to take any action to effect, any registration pursuant
to Section 2.1(b)(i) during the period that is thirty (30) days before the
Company’s good faith estimate of the date of filing of, and ending on a date
that is ninety (90) days after the effective date of, a Company-initiated
registration, provided, that the Company is actively employing in good faith
commercially reasonable efforts to cause such registration statement to become
effective; or (ii) if the Company has effected two registrations in the previous
twelve (12) month period pursuant to Section 2.1(b). A registration shall not be
counted as “effected” for purposes of this Section 2.1(d) until such time as the
applicable registration statement has been declared effective by the SEC, unless
the Initiating Holders withdraw their request for such registration, elect not
to pay the registration expenses therefor, and forfeit their right to one demand
registration statement pursuant to Section 2.6, in which case such withdrawn
registration statement shall be counted as “effected” for purposes of this
Section 2.1(d).

2.2 Company Registration. If after the expiration or termination of the Offering
Registration Statement(s), the Company proposes to register (including, for this
purpose, a registration effected by the Company for stockholders other than the
Holders) any of its Common Stock under the Securities Act in connection with the
public offering of such securities solely for cash (other than in an Excluded
Registration), the Company shall, at such time, promptly give each Holder notice
of such registration. Upon the request of each Holder given within twenty
(20) days after such notice is given by the Company, the Company shall, subject
to the provisions of Section 2.3, cause to be registered all of the Registrable
Securities that each such Holder has requested to be included in such
registration. The Company shall have the right to terminate or withdraw any
registration initiated by it under this Section 2.2 before the effective date of
such registration, whether or not any Holder has elected to include Registrable
Securities in such registration. The expenses (other than Selling Expenses) of
such withdrawn registration shall be borne by the Company in accordance with
Section 2.6.

 

  2.3 Underwriting Requirements.

(a) If, pursuant to Section 2.1, the Initiating Holders intend to distribute the
Registrable Securities covered by their request by means of an underwriting,
they shall so advise the Company as a part of their request made pursuant to
Section 2.1, and the Company shall include such information in the Demand
Notice. The underwriter(s) will be selected by the Initiating Holders, subject
only to the reasonable approval of the Company. In such event, the right of any
Holder to include such Holder’s Registrable Securities in such registration
shall be conditioned upon such Holder’s participation in such underwriting and
the inclusion of such Holder’s Registrable Securities in the underwriting to the
extent provided herein. All Holders proposing to distribute their securities
through such underwriting shall (together with the Company as provided in
Section 2.4(e)) enter into an underwriting agreement in customary form with the
underwriter(s) selected for such underwriting. Notwithstanding any other
provision of this Section 2.3, if the managing underwriter(s) advise(s) the
Initiating Holders in writing that marketing factors require a limitation on the
number of shares to be underwritten, then the Initiating Holders shall so advise
all Holders of Registrable Securities that otherwise would be underwritten
pursuant hereto, and the number of Registrable Securities that

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may be included in the underwriting shall be allocated among such Holders of
Registrable Securities, including the Initiating Holders, in proportion (as
nearly as practicable) to the number of Registrable Securities owned by each
Holder or in such other proportion as shall mutually be agreed to by all such
selling Holders; provided, however, that the number of Registrable Securities
held by the Holders to be included in such underwriting shall not be reduced
unless all other securities are first entirely excluded from the underwriting.
To facilitate the allocation of shares in accordance with the above provisions,
the Company or the underwriters may round the number of shares allocated to any
Holder to the nearest 100 shares.

(b) In connection with any offering involving an underwriting of shares of the
Company’s capital stock pursuant to Section 2.2, the Company shall not be
required to include any of the Holders’ Registrable Securities in such
underwriting unless the Holders accept the terms of the underwriting as agreed
upon between the Company and its underwriters, and then only in such quantity as
the underwriters in their sole discretion determine will not jeopardize the
success of the offering by the Company. If the total number of securities,
including Registrable Securities, requested by stockholders to be included in
such offering exceeds the number of securities to be sold (other than by the
Company) that the underwriters in their reasonable discretion determine is
compatible with the success of the offering, then the Company shall be required
to include in the offering only that number of such securities, including
Registrable Securities, which the underwriters and the Company in their sole
discretion determine will not jeopardize the success of the offering. If the
underwriters determine that less than all of the Registrable Securities
requested to be registered can be included in such offering, then the
Registrable Securities that are included in such offering shall be allocated
among the selling Holders in proportion (as nearly as practicable to) the number
of Registrable Securities owned by each selling Holder or in such other
proportions as shall mutually be agreed to by all such selling Holders. To
facilitate the allocation of shares in accordance with the above provisions, the
Company or the underwriters may round the number of shares allocated to any
Holder to the nearest 100 shares. Notwithstanding the foregoing, in no event
shall (i) the number of Registrable Securities included in the offering be
reduced unless all other securities (other than securities to be sold by the
Company) are first entirely excluded from the offering, or (ii) the number of
Registrable Securities included in the offering be reduced below thirty percent
(30%) of the total number of securities included in such offering. For purposes
of the provision in this Section 2.3(b) concerning apportionment, for any
selling Holder that is a partnership, limited liability company, or corporation,
the partners, members, retired partners, retired members, stockholders, and
Affiliates of such Holder, or the estates and Immediate Family Members of any
such partners, retired partners, members, and retired members and any trusts for
the benefit of any of the foregoing Persons, shall be deemed to be a single
“selling Holder,” and any pro rata reduction with respect to such “selling
Holder” shall be based upon the aggregate number of Registrable Securities owned
by all Persons included in such “selling Holder,” as defined in this sentence.

(c) For purposes of Section 2.1, a registration shall not be counted as
“effected” if, as a result of an exercise of the underwriter’s cutback
provisions in Section 2.3(a), fewer than fifty percent (50%) of the total number
of Registrable Securities that Holders have requested to be included in such
registration statement are actually included.

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2.4 Obligations of the Company. Whenever required under this Section 2 to effect
the registration of any Registrable Securities, the Company shall, as
expeditiously as reasonably possible:

(a) prepare and file with the SEC a registration statement with respect to such
Registrable Securities and use its commercially reasonable efforts to cause such
registration statement to become effective and, upon the request of the Holders
of a majority of the Registrable Securities registered thereunder, keep such
registration statement effective for a period of up to one hundred twenty
(120) days or, if earlier, until the distribution contemplated in the
registration statement has been completed; provided, however, that (i) such one
hundred twenty (120) day period shall be extended for a period of time equal to
the period the Holder refrains, at the request of an underwriter of Common Stock
(or other securities) of the Company, from selling any securities included in
such registration, and (ii) in the case of any registration of Registrable
Securities on Form S-3 that are intended to be offered on a continuous or
delayed basis, subject to compliance with applicable SEC rules, such one hundred
twenty (120) day period shall be extended for up to sixty (60) days, if
necessary, to keep the registration statement effective until all such
Registrable Securities are sold;

(b) prepare and file with the SEC such amendments and supplements to such
registration statement, and the prospectus used in connection with such
registration statement, as may be necessary to comply with the Securities Act in
order to enable the disposition of all securities covered by such registration
statement;

(c) furnish to the selling Holders such numbers of copies of a prospectus,
including a preliminary prospectus, as required by the Securities Act, and such
other documents as the Holders may reasonably request in order to facilitate
their disposition of their Registrable Securities;

(d) use its commercially reasonable efforts to register and qualify the
securities covered by such registration statement under such other securities or
blue-sky laws of such jurisdictions as shall be reasonably requested by the
selling Holders; provided, that the Company shall not be required to qualify to
do business or to file a general consent to service of process in any such
states or jurisdictions, unless the Company is already subject to service in
such jurisdiction and except as may be required by the Securities Act;

(e) in the event of any underwritten public offering, enter into and perform its
obligations under an underwriting agreement, in usual and customary form, with
the underwriter(s) of such offering;

(f) use its commercially reasonable efforts to cause all such Registrable
Securities covered by such registration statement to be listed on a national
securities exchange or trading system and each securities exchange and trading
system (if any) on which similar securities issued by the Company are then
listed;

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(g) provide a transfer agent and registrar for all Registrable Securities
registered pursuant to this Agreement and provide a CUSIP number for all such
Registrable Securities, in each case not later than the effective date of such
registration;

(h) promptly make available for inspection by the selling Holders, any managing
underwriter(s) participating in any disposition pursuant to such registration
statement, and any attorney or accountant or other agent retained by any such
underwriter or selected by the selling Holders, all financial and other records,
pertinent corporate documents, and properties of the Company, and cause the
Company’s officers, directors, employees, and independent accountants to supply
all information reasonably requested by any such seller, underwriter, attorney,
accountant, or agent, in each case, as necessary or advisable to verify the
accuracy of the information in such registration statement and to conduct
appropriate due diligence in connection therewith;

(i) notify each selling Holder, promptly after the Company receives notice
thereof, of the time when such registration statement has been declared
effective or a supplement to any prospectus forming a part of such registration
statement has been filed; and

(j) after such registration statement becomes effective, notify each selling
Holder of any request by the SEC that the Company amend or supplement such
registration statement or prospectus.

2.5 Furnish Information. It shall be a condition precedent to the obligations of
the Company to take any action pursuant to this Section 2 with respect to the
Registrable Securities of any selling Holder that such Holder shall furnish to
the Company such information regarding itself, the Registrable Securities held
by it, and the intended method of disposition of such securities as is
reasonably required to effect the registration of such Holder’s Registrable
Securities.

2.6 Expenses of Registration. All expenses (other than Selling Expenses)
incurred in connection with registrations, filings, or qualifications pursuant
to Section 2, including all registration, filing, and qualification fees;
printers’ and accounting fees; fees and disbursements of counsel for the
Company; and the reasonable fees and disbursements, not to exceed $75,000, of
one counsel for the selling Holders (“Selling Holder Counsel”), shall be borne
and paid by the Company; provided, however, that the Company shall not be
required to pay for any expenses of any registration proceeding begun pursuant
to Section 2.1 if the registration request is subsequently withdrawn at the
request of the Holders of a majority of the Registrable Securities to be
registered (in which case all selling Holders shall bear such expenses pro rata
based upon the number of Registrable Securities that were to be included in the
withdrawn registration), unless the Holders of a majority of the Registrable
Securities agree to forfeit their right to one registration pursuant to Sections
2.1(a) or 2.1(b), as the case may be; provided, further, that if, at the time of
such withdrawal, the Holders shall have learned of a material adverse change in
the condition, business, or prospects of the Company from that known to the
Holders at the time of their request and have withdrawn the request with
reasonable promptness after learning of such information then the Holders shall
not be required to pay any of such expenses and shall not forfeit their right to
one registration pursuant to Sections 2.1(a) or 2.1(b). All Selling Expenses
relating to Registrable Securities registered pursuant to this Section 2 shall
be borne and paid by the Holders pro rata on the basis of the number of
Registrable Securities registered on their behalf.

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2.7 Delay of Registration. No Holder shall have any right to obtain or seek an
injunction restraining or otherwise delaying any registration pursuant to this
Agreement as the result of any controversy that might arise with respect to the
interpretation or implementation of this Section 2.

2.8 Indemnification. If any Registrable Securities are included in a
registration statement under this Section 2:

(a) To the extent permitted by law, the Company shall indemnify and hold
harmless each selling Holder, and the partners, members, officers, directors,
and stockholders of each such Holder; legal counsel and accountants for each
such Holder; any underwriter (as defined in the Securities Act) for each such
Holder; and each Person, if any, who controls such Holder or underwriter within
the meaning of the Securities Act or the Exchange Act, against any Damages, and
the Company will pay to each such Holder, underwriter, controlling Person, or
other aforementioned Person any legal or other expenses reasonably incurred
thereby in connection with investigating or defending any claim or proceeding
from which Damages may result, as such expenses are incurred; provided, however,
that the indemnity agreement contained in this Section 2.8(a) shall not apply to
amounts paid in settlement of any such claim or proceeding if such settlement is
effected without the consent of the Company, which consent shall not be
unreasonably withheld, nor shall the Company be liable for any Damages to the
extent that they arise out of or are based upon actions or omissions made in
reliance upon and in conformity with written information furnished by or on
behalf of any such Holder, underwriter, controlling Person, or other
aforementioned Person expressly for use in connection with such registration.

(b) To the extent permitted by law, each selling Holder, severally and not
jointly, shall indemnify and hold harmless the Company, and each of its
directors, each of its officers who has signed the registration statement, each
Person (if any), who controls the Company within the meaning of the Securities
Act, legal counsel and accountants for the Company, any underwriter (as defined
in the Securities Act), any other Holder selling securities in such registration
statement, and any controlling Person of any such underwriter or other Holder,
against any Damages, in each case only to the extent that such Damages arise out
of or are based upon actions or omissions made in reliance upon and in
conformity with written information furnished by or on behalf of such selling
Holder expressly for use in connection with such registration; and each such
selling Holder will pay to the Company and each other aforementioned Person any
legal or other expenses reasonably incurred thereby in connection with
investigating or defending any claim or proceeding from which Damages may
result, as such expenses are incurred; provided, however, that the indemnity
agreement contained in this Section 2.8(b) shall not apply to amounts paid in
settlement of any such claim or proceeding if such settlement is effected
without the consent of the Holder, which consent shall not be unreasonably
withheld; and provided, further, that in no event shall the aggregate amounts
payable by any Holder by way of indemnity or contribution under Sections 2.8(b)
and 2.8(d) exceed the proceeds from the offering received by such Holder (net of
any Selling Expenses paid by such Holder), except in the case of fraud or
willful misconduct by such Holder.

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(c) Promptly after receipt by an indemnified party under this Section 2.8 of
notice of the commencement of any action (including any governmental action) for
which a party may be entitled to indemnification hereunder, such indemnified
party will, if a claim in respect thereof is to be made against any indemnifying
party under this Section 2.8, give the indemnifying party notice of the
commencement thereof. The indemnifying party shall have the right to participate
in such action and, to the extent the indemnifying party so desires, participate
jointly with any other indemnifying party to which notice has been given, and to
assume the defense thereof with counsel mutually satisfactory to the parties;
provided, however, that an indemnified party (together with all other
indemnified parties that may be represented without conflict by one counsel)
shall have the right to retain one separate counsel, with the fees and expenses
to be paid by the indemnifying party, if representation of such indemnified
party by the counsel retained by the indemnifying party would be inappropriate
due to actual or potential differing interests between such indemnified party
and any other party represented by such counsel in such action.

(d) To provide for just and equitable contribution to joint liability under the
Securities Act in any case in which either (i) any party otherwise entitled to
indemnification hereunder makes a claim for indemnification pursuant to this
Section 2.8 but it is judicially determined (by the entry of a final judgment or
decree by a court of competent jurisdiction and the expiration of time to appeal
or the denial of the last right of appeal) that such indemnification may not be
enforced in such case, notwithstanding the fact that this Section 2.8 provides
for indemnification in such case, or (ii) contribution under the Securities Act
may be required on the part of any party hereto for which indemnification is
provided under this Section 2.8, then, and in each such case, such parties will
contribute to the aggregate losses, claims, damages, liabilities, or expenses to
which they may be subject (after contribution from others) in such proportion as
is appropriate to reflect the relative fault of each of the indemnifying party
and the indemnified party in connection with the statements, omissions, or other
actions that resulted in such loss, claim, damage, liability, or expense, as
well as to reflect any other relevant equitable considerations. The relative
fault of the indemnifying party and of the indemnified party shall be determined
by reference to, among other things, whether the untrue or allegedly untrue
statement of a material fact, or the omission or alleged omission of a material
fact, relates to information supplied by the indemnifying party or by the
indemnified party and the parties’ relative intent, knowledge, access to
information, and opportunity to correct or prevent such statement or omission;
provided, however, that, in any such case, (x) no Holder will be required to
contribute any amount in excess of the public offering price of all such
Registrable Securities offered and sold by such Holder pursuant to such
registration statement, and (y) no Person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) will be entitled to
contribution from any Person who was not guilty of such fraudulent
misrepresentation; and provided, further, that in no event shall a Holder’s
liability pursuant to this Section 2.8(d), when combined with the amounts paid
or payable by such Holder pursuant to Section 2.8(b), exceed the proceeds from
the offering received by such Holder (net of any Selling Expenses) paid by such
Holder), except in the case of willful misconduct or fraud by such Holder.

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(e) Notwithstanding the foregoing, to the extent that the provisions on
indemnification and contribution contained in the underwriting agreement entered
into in connection with the underwritten public offering are in conflict with
the foregoing provisions, the provisions in the underwriting agreement shall
control.

(f) Unless otherwise superseded by an underwriting agreement entered into in
connection with the underwritten public offering, the obligations of the Company
and Holders under this Section 2.8 shall survive the completion of any offering
of Registrable Securities in a registration under this Section 2, and otherwise
shall survive the termination of this Agreement.

2.9 Reports Under Exchange Act. With a view to making available to the Holders
the benefits of SEC Rule 144 and any other rule or regulation of the SEC that
may at any time permit a Holder to sell securities of the Company to the public
without registration or pursuant to a registration on Form S-3, the Company
shall:

(a) make and keep available adequate current public information, as those terms
are understood and defined in SEC Rule 144, at all times after the effective
date of the registration statement filed by the Company;

(b) use commercially reasonable efforts to file with the SEC in a timely manner
all reports and other documents required of the Company under the Securities Act
and the Exchange Act (at any time after the Company has become subject to such
reporting requirements); and

(c) furnish to any Holder, so long as the Holder owns any Registrable
Securities, forthwith upon request (i) to the extent accurate, a written
statement by the Company that it has complied with the reporting requirements of
SEC Rule 144, the Securities Act, and the Exchange Act (at any time after the
Company has become subject to such reporting requirements), or that it qualifies
as a registrant whose securities may be resold pursuant to Form S-3 (at any time
after the Company so qualifies); (ii) a copy of the most recent annual or
quarterly report of the Company and such other reports and documents so filed by
the Company; and (iii) such other information as may be reasonably requested in
availing any Holder of any rule or regulation of the SEC that permits the
selling of any such securities without registration (at any time after the
Company has become subject to the reporting requirements under the Exchange Act)
or pursuant to Form S-3 (at any time after the Company so qualifies to use such
form).

2.10 Limitations on Subsequent Registration Rights. From and after the date of
this Agreement, the Company shall not, without the prior written consent of the
Holders of more than the majority of the Registrable Securities then outstanding
enter into any agreement with any holder or prospective holder of any securities
of the Company that would allow such holder or prospective holder (i) to include
such securities in any registration unless, under the terms of such agreement,
such holder or prospective holder may include such securities in any such
registration only to the extent that the inclusion of such securities will not
reduce the number of the Registrable Securities of the Holders that are included
or (ii) allow such holder or prospective holder to initiate a demand for
registration of any securities held by such holder or prospective holder.

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2.11 “Market Stand-off” Agreement. Each Holder hereby agrees that it will not,
without the prior written consent of the managing underwriter for an
underwritten public offering by the Company, during the period commencing and
ending on the dates specified by the Company and the managing underwriter (such
period not to exceed ninety (90) days), (i) lend; offer; pledge; sell; contract
to sell; sell any option or contract to purchase; purchase any option or
contract to sell; grant any option, right, or warrant to purchase; or otherwise
transfer or dispose of, directly or indirectly, any shares of Common Stock or
any securities convertible into or exercisable or exchangeable (directly or
indirectly) for Common Stock held immediately before the effective date of the
registration statement for such offering or (ii) enter into any swap or other
arrangement that transfers to another, in whole or in part, any of the economic
consequences of ownership of such securities, whether any such transaction
described in clause (i) or (ii) above is to be settled by delivery of Common
Stock or other securities, in cash, or otherwise. Notwithstanding clause (i) and
(ii) above, each Holder may distribute any or all of its shares of Common Stock
or any securities convertible into or exercisable or exchangeable (directly or
indirectly) for Common Stock to any of its limited partners, provided, however,
that such limited partners who receive the distribution of any or all shares of
Common Stock or any securities convertible into or exercisable or exchangeable
(directly or indirectly) for Common Stock shall still be subject to the other
provisions of this Section 2.11. The foregoing provisions of this Section 2.11
shall not apply to the sale of any shares to an underwriter pursuant to an
underwriting agreement, and shall be applicable to the Holders only if all
officers and directors are subject to the same restrictions. The underwriters in
connection with such registration are intended third-party beneficiaries of this
Section 2.11 and shall have the right, power, and authority to enforce the
provisions hereof as though they were a party hereto. Each Holder further agrees
to execute such agreements as may be reasonably requested by the underwriters in
connection with such registration that are consistent with this Section 2.11 or
that are necessary to give further effect thereto. Any discretionary waiver or
termination of the restrictions of any or all of such agreements by the Company
or the underwriters shall apply pro rata to all Holders subject to such
agreements, based on the number of shares subject to such agreements.

2.12 Restrictions on Transfer.

(a) The Registrable Securities shall not be sold, pledged, or otherwise
transferred, and the Company shall not recognize and shall issue stop-transfer
instructions to its transfer agent with respect to any such sale, pledge, or
transfer, except upon the conditions specified in this Agreement, which
conditions are intended to ensure compliance with the provisions of the
Securities Act. A transferring Holder will cause any proposed purchaser,
pledgee, or transferee of the Registrable Securities held by such Holder to
agree to take and hold such securities subject to the provisions and upon the
conditions specified in this Agreement.

(b) Each certificate or instrument representing (i) the Registrable Securities,
and (ii) any other securities issued in respect of the securities referenced in
clauses (i) and (ii), upon any stock split, stock dividend, recapitalization,
merger, consolidation, or similar event, may (unless otherwise permitted by the
provisions of Section 2.12(c) be stamped or otherwise imprinted with a legend
substantially in the following form:

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THE SHARES REPRESENTED HEREBY HAVE BEEN ACQUIRED FOR INVESTMENT AND HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933. SUCH SHARES MAY NOT BE SOLD,
PLEDGED, OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR A VALID EXEMPTION
FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SAID ACT.

THE SECURITIES REPRESENTED HEREBY MAY BE TRANSFERRED ONLY IN ACCORDANCE WITH THE
TERMS OF AN AGREEMENT BETWEEN THE COMPANY AND THE STOCKHOLDER, A COPY OF WHICH
IS ON FILE WITH THE SECRETARY OF THE COMPANY.

The Holders consent to the Company making a notation in its records and giving
instructions to any transfer agent of the Restricted Securities in order to
implement the restrictions on transfer set forth in this Section 2.12.

The legends set forth above shall not be placed on Registrable Securities (and
the Company shall cause any such legends to be removed) if (a) such Registrable
Securities are, or may be, sold pursuant to a registration statement under the
Securities Act, including for the avoidance of doubt, filed by the Company
pursuant to the Offering RRA, or (b) such Holder delivers to the Company an
opinion of counsel, reasonably acceptable to the Company, that a disposition of
the Registrable Securities is being made pursuant to an exemption from such
registration and that the Registrable Securities, after such transfer, shall no
longer be “restricted securities” within the meaning of Rule 144.

(c) The holder of each certificate representing Restricted Securities, by
acceptance thereof, agrees to comply in all respects with the provisions of this
Section 2. Before any proposed sale, pledge, or transfer of any Restricted
Securities, unless there is in effect a registration statement under the
Securities Act covering the proposed transaction, the Holder thereof shall give
notice to the Company of such Holder’s intention to effect such sale, pledge, or
transfer. Each such notice shall describe the manner and circumstances of the
proposed sale, pledge, or transfer in sufficient detail and, if reasonably
requested by the Company, shall be accompanied at such Holder’s expense by
either (i) a written opinion of legal counsel who shall, and whose legal opinion
shall, be reasonably satisfactory to the Company, addressed to the Company, to
the effect that the proposed transaction may be effected without registration
under the Securities Act; (ii) a “no action” letter from the SEC to the effect
that the proposed sale, pledge, or transfer of such Restricted Securities
without registration will not result in a recommendation by the staff of the SEC
that action be taken with respect thereto; or (iii) any other evidence
reasonably satisfactory to counsel to the Company to the effect that the
proposed sale, pledge, or transfer of the Restricted Securities may be effected
without registration under the Securities Act, whereupon the Holder of such
Restricted Securities shall be entitled to sell, pledge, or transfer such
Restricted Securities in accordance with the terms of the notice given by the
Holder to the Company. The Company will not require such a legal opinion or “no
action”

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letter (x) in any transaction in compliance with SEC Rule 144 or (y) in any
transaction in which such Holder distributes Restricted Securities to an
Affiliate of such Holder for no consideration; provided, that each transferee
agrees in writing to be subject to the terms of this Section 2.12. Each
certificate or instrument evidencing the Restricted Securities transferred as
above provided shall bear, except if such transfer is made pursuant to SEC Rule
144, the appropriate restrictive legend set forth in Section 2.12(b), except
that such certificate shall not bear such restrictive legend if, in the opinion
of counsel for such Holder and the Company, such legend is not required in order
to establish compliance with any provisions of the Securities Act.

2.13 Termination of Registration Rights. The right of any Holder to request
registration or inclusion of Registrable Securities in any registration pursuant
to Subsections 2.1 or 2.2 shall terminate upon the earliest to occur of:

(a) the closing of (i) the sale of all or substantially all of the assets of the
Company on a consolidated basis to an unrelated person or entity, (ii) a merger,
reorganization or consolidation pursuant to which the holders of the Company’s
outstanding voting power and outstanding stock immediately prior to such
transaction do not own a majority of the outstanding voting power and
outstanding stock or other equity interests of the resulting or successor entity
(or its ultimate parent, if applicable) immediately upon completion of such
transaction, (iii) the sale of all or substantially all of the Company’s assets
or property to an unrelated person, entity or group thereof acting in concert,
or (iv) any other transaction in which the owners of the Company’s outstanding
voting power immediately prior to such transaction do not own at least a
majority of the outstanding voting power of the Company or any successor entity
immediately upon completion of the transaction other than as a result of the
acquisition of securities directly from the Company; or

(b) such time as Rule 144 or another similar exemption under the Securities Act
is available for the sale of all of such Holder’s shares without limitation or
restriction during a three-month period without registration.

 

  3. Miscellaneous.

3.1 Successors and Assigns. The rights under this Agreement may be assigned (but
only with all related obligations) by a Holder to a transferee of Registrable
Securities that (i) is an Affiliate of a Holder; (ii) is a Holder’s Immediate
Family Member or trust for the benefit of an individual Holder or one or more of
such Holder’s Immediate Family Members; or (iii) after such transfer, holds at
least 1,000 shares of Registrable Securities (subject to appropriate adjustment
for stock splits, stock dividends, combinations, and other recapitalizations);
provided, however, that (x) the Company is, within a reasonable time after such
transfer, furnished with written notice of the name and address of such
transferee and the Registrable Securities with respect to which such rights are
being transferred; and (y) such transferee agrees in a written instrument
delivered to the Company to be bound by and subject to the terms and conditions
of this Agreement, including the provisions of Section 2.11. For the purposes of
determining the number of shares of Registrable Securities held by a transferee,
the holdings of a transferee (1) that is an Affiliate or stockholder of a
Holder; (2) who is a Holder’s Immediate Family Member; or (3) that is a trust
for the benefit of an individual Holder or such

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Holder’s Immediate Family Member shall be aggregated together and with those of
the transferring Holder; provided, further, that all transferees who would not
qualify individually for assignment of rights shall have a single
attorney-in-fact for the purpose of exercising any rights, receiving notices, or
taking any action under this Agreement. The terms and conditions of this
Agreement inure to the benefit of and are binding upon the respective successors
and permitted assignees of the parties. Nothing in this Agreement, express or
implied, is intended to confer upon any party other than the parties hereto or
their respective successors and permitted assignees any rights, remedies,
obligations or liabilities under or by reason of this Agreement, except as
expressly provided herein.

3.2 Governing Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Delaware, regardless of the laws that
might otherwise govern under applicable principles of conflicts of law.

3.3 Counterparts; Facsimile or PDF. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. This Agreement may also
be executed and delivered by facsimile or PDF signature and in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

3.4 Titles and Subtitles. The titles and subtitles used in this Agreement are
for convenience only and are not to be considered in construing or interpreting
this Agreement.

3.5 Notices. All notices and other communications given or made pursuant to this
Agreement shall be in writing and shall be deemed effectively given upon the
earlier of actual receipt or: (i) personal delivery to the party to be notified;
(ii) when sent, if sent by electronic mail or facsimile during the recipient’s
normal business hours, and if not sent during normal business hours, then on the
recipient’s next business day; (iii) five (5) days after having been sent by
registered or certified mail, return receipt requested, postage prepaid; or
(iv) one (1) business day after the business day of deposit with a nationally
recognized overnight courier, freight prepaid, specifying next-day delivery,
with written verification of receipt. All communications shall be sent to the
respective parties at their addresses as set forth on Schedule A hereto, or to
the principal office of the Company and to the attention of the Chief Executive
Officer, in the case of the Company, or to such email address, facsimile number,
or address as subsequently modified by written notice given in accordance with
this Section 3.5. If notice is given to the Company, a copy shall also be sent
to Goodwin Procter LLP, 100 Northern Avenue, Boston, MA 02210, Attn: Kingsley L.
Taft, Esq., and if notice is given to the Investors, a copy shall also be sent
to the Investors, a copy shall also be sent to their counsel, if and as set
forth on Schedule A.

3.6 Amendments and Waivers. Any term of this Agreement may be amended and the
observance of any term of this Agreement may be waived (either generally or in a
particular instance, and either retroactively or prospectively) only with the
written consent of the Company and the Holders of more than the majority of the
Registrable Securities then outstanding; provided, that the Company may in its
sole discretion waive compliance with Section 2.12(c) (and the Company’s failure
to object promptly in writing after notification of a

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proposed assignment allegedly in violation of Section 2.12(c) shall be deemed to
be a waiver); and provided, further, that any provision hereof may be waived by
any waiving party on such party’s own behalf, without the consent of any other
party. Notwithstanding the foregoing, this Agreement may not be amended or
terminated and the observance of any term hereof may not be waived with respect
to any Investor without the written consent of such Investor, unless such
amendment, termination, or waiver applies to all Investors in the same fashion.
The Company shall give prompt notice of any amendment or termination hereof or
waiver hereunder to any party hereto that did not consent in writing to such
amendment, termination, or waiver. Any amendment, termination, or waiver
effected in accordance with this Section 3.6 shall be binding on all parties
hereto, regardless of whether any such party has consented thereto. No waivers
of or exceptions to any term, condition, or provision of this Agreement, in any
one or more instances, shall be deemed to be or construed as a further or
continuing waiver of any such term, condition, or provision.

3.7 Severability. In case any one or more of the provisions contained in this
Agreement is for any reason held to be invalid, illegal or unenforceable in any
respect, such invalidity, illegality, or unenforceability shall not affect any
other provision of this Agreement, and such invalid, illegal, or unenforceable
provision shall be reformed and construed so that it will be valid, legal, and
enforceable to the maximum extent permitted by law.

3.8 Aggregation of Stock. All shares of Registrable Securities held or acquired
by Affiliates shall be aggregated together for the purpose of determining the
availability of any rights under this Agreement and such Affiliated persons may
apportion such rights as among themselves in any manner they deem appropriate.

3.9 Entire Agreement. This Agreement (including any Schedules and Exhibits
hereto) constitutes the full and entire understanding and agreement among the
parties with respect to the subject matter hereof, and any other written or oral
agreement relating to the subject matter hereof existing between the parties is
expressly canceled.

3.10 Delays or Omissions. No delay or omission to exercise any right, power, or
remedy accruing to any party under this Agreement, upon any breach or default of
any other party under this Agreement, shall impair any such right, power, or
remedy of such nonbreaching or nondefaulting party, nor shall it be construed to
be a waiver of or acquiescence to any such breach or default, or to any similar
breach or default thereafter occurring, nor shall any waiver of any single
breach or default be deemed a waiver of any other breach or default theretofore
or thereafter occurring. All remedies, whether under this Agreement or by law or
otherwise afforded to any party, shall be cumulative and not alternative.

3.11 Acknowledgment. The Company acknowledges that the Investors are in the
business of venture capital investing and therefore review the business plans
and related proprietary information of many enterprises, including enterprises
which may have products or services which compete directly or indirectly with
those of the Company. Nothing in this Agreement shall preclude or in any way
restrict the Investors from investing or participating in any particular
enterprise whether or not such enterprise has products or services which compete
with those of the Company.

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IN WITNESS WHEREOF, the parties have executed this Registration Rights Agreement
as of the date first written above.

 

AERPIO PHARMACEUTICALS, INC.

By:

 

/s/ Joseph H. Gardner

 

Joseph H. Gardner, Ph.D.

 

President and CEO

Address:

9987 Carver Road, Suite 420

Cincinnati, OH 45242