Exhibit 10.1

WARRANT EXERCISE AGREEMENT

This Warrant Exercise Agreement (this “Agreement”), dated as of November 20,
2018, is by and between BioPharmX Corporation, a Delaware corporation (the
“Company”), and the undersigned holder (the “Holder”) of warrants to purchase
shares of the Company’s common stock, par value $0.001 per share (the “Common
Stock”).

WHEREAS, the Holder beneficially owns in the aggregate the number of warrants to
purchase Common Stock with an exercise price of $0.25 per share that are
exercisable until May 24, 2019, as set forth on the Holder's signature page
hereto (the “Original Warrants”).

WHEREAS, in order to induce the Holder to exercise the Original Warrants, the
Company and the Holder desire to amend the Original Warrants to reduce the
exercise price thereof to $0.14 per share, provided that the Original Warrants
are exercised prior to February 28, 2019, otherwise such Amended Exercise Price
shall remain $0.25 per share (the “Amended Exercise Price”);

WHEREAS, the Holder desires to exercise such Original Warrants in the amounts
set forth on the applicable signature pages hereto using the Amended Exercise
Price and, immediately prior to such exercise and in consideration of the
Holder’s exercise of such Original Warrants, the Company has agreed to issue the
Holder, in addition to the shares of Common Stock to which such exercising
Holder is entitled pursuant to the exercise of the Original Warrants, an equal
number of new warrants as the number of Original Warrants being exercised in the
form attached hereto as Exhibit A (the “New Warrants”).  The shares of Common
Stock underlying the Original Warrants are referred to herein as the “Warrant
Shares”.  The shares of Common Stock underlying the New Warrants are referred to
herein as the “New Warrant Shares” and collectively with the New Warrants and
Warrant Shares, the “Securities”.

NOW, THEREFORE, IN CONSIDERATION of the mutual covenants contained in this
Agreement, and for good and valuable consideration the receipt and adequacy of
which are hereby acknowledged, the Holder and the Company agree as follows:

ARTICLE I

DEFINITIONS

Section 1.1 Definitions.   Capitalized terms not defined in this Agreement shall
have the meanings ascribed to such terms in the New Warrants.  

ARTICLE II

AMENDMENT AND EXERCISE OF ORIGINAL WARRANTS

Section 2.1 Amendment of Original Warrants.  (a) On the date hereof, the
reference to “$0.25 per share” in the defined term “Exercise Price” set forth in
Section 1(b) of the Original Warrants shall be amended to equal “$0.14 per
share, provided that this Warrant is exercised prior to February 28, 2019,
otherwise such Exercise Price shall remain $0.25 per share” (the “Amended
Exercise Price”).

(b)All references to the Original Warrants used herein, after the execution of
this Agreement, shall refer to the Original Warrants, as amended pursuant to
clause (a) above.  Except as expressly set forth in

1

--------------------------------------------------------------------------------

 

this Agreement, all terms of the Original Warrants are, and shall continue to
be, in full force and effect and are hereby ratified and confirmed in all
respects, and the Holder reserves all of its rights, remedies, powers and
privileges.

Section 2.2 Exercise of Warrants.   (a) Subject to the conditions in Section
1(f) of each of the Original Warrants, by executing this Agreement, the Company
and the Holder hereby agree that the Holder shall be deemed to have
exercised the number of Original Warrants set forth on the signature page hereto
for aggregate cash proceeds to the Company in the amount set forth on the
Holder’s signature page hereto, pursuant to the terms of the Original Warrants,
except that the exercise price thereunder shall be the Amended Exercise Price.
 The Holder shall deliver the aggregate cash exercise price for such Original
Warrants to the bank account set forth on the Company’s signature page hereto
within two Trading Days after the date hereof and the Company shall deliver the
Warrant Shares to the Holder via the Depository Trust Company Deposit or
Withdrawal at Custodian system pursuant to the terms of the Original Warrants,
but pursuant to DWAC instructions set forth on the Holder’s signature page
hereto. The date of the closing of the initial exercise of the Original Warrants
shall be referred to as the “Closing Date.”  

(b) After the Closing Date, if and whenever the Holder, together with its
Attribution Parties (as defined in Section 1(f) of the Original Warrants), can
exercise all of the remaining Original Warrants in compliance with the
Beneficial Ownership Limitation, the Holder hereby covenants and agrees to
promptly notify the Company of such event and to promptly exercise for cash such
remaining Original Warrants held by it by delivery of a Notice of Exercise
pursuant to the terms and conditions of the applicable Original Warrants.  The
parties hereto further agree that the Holder may voluntarily exercise for cash,
from time to time, the Original Warrants pursuant to the terms and conditions of
the applicable Original Warrants. 

Section 2.3 Issuance of New Warrants. Within two Trading Days of the Closing
Date, the Company shall deliver to the Holder the New Warrants to which the
Holder is entitled.   The Holder shall be entitled to receive a New Warrant
issuable for the identical number of shares of Common Stock as the Holder
exercises for cash pursuant to Section 2.2(a) above.  Within 2 Trading Days of
the exercise of any remaining Original Warrants for cash prior to February 28,
2019 (the “Termination Date”), whether such exercise is required under this
Agreement, or is at the election of the Holder, the Company shall deliver to the
Holder one New Warrant issuable for the identical number of remaining Original
Warrants exercised.  The obligations under Section 2.3 shall terminate on the
Termination Date.

 

Section 2.4 Legends; Restricted Securities.    (a) The Holder understands that
the New Warrants and the shares of Common Stock underlying New Warrants are not,
and may never be, registered under the Securities Act of 1933, as amended (the
“Securities Act”), or the securities laws of any state and, accordingly, each
certificate, if any, representing such securities shall bear a legend
substantially similar to the following:

“NEITHER THIS SECURITY NOR THE SECURITIES FOR WHICH THIS SECURITY IS EXERCISABLE
HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE
SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN
AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE
SECURITIES LAWS. THIS SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS
SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT WITH A

2

--------------------------------------------------------------------------------

 

REGISTERED BROKER-DEALER OR OTHER LOAN WITH A FINANCIAL INSTITUTION THAT IS AN
“ACCREDITED INVESTOR” AS DEFINED IN RULE 501(a) UNDER THE SECURITIES ACT OR
OTHER LOAN SECURED BY SUCH SECURITIES.”

(b)Certificates evidencing shares of Common Stock underlying the New Warrants
shall not contain any legend (including the legend set forth in Section 2.4(a)
hereof), (i) while a registration statement covering the resale of such Common
Stock is effective under the Securities Act, (ii) following any sale of such
Common Stock pursuant to Rule 144, (iii) if such Common Stock is eligible for
sale under Rule 144 (assuming cashless exercise of the New Warrants), without
the requirement for the Company to be in compliance with the current public
information required under Rule 144 as to such Common Stock and without volume
or manner-of-sale restrictions, (iv) if such Common Stock may be sold under Rule
144 (assuming cashless exercise of the New Warrants) and the Company is then in
compliance with the current public information required under Rule 144 as to
such Common Stock, or (v) if such legend is not required under applicable
requirements of the Securities Act (including judicial interpretations and
pronouncements issued by the staff of the Securities and Exchange Commission
(the “Commission”)). The Company shall cause its counsel to issue a legal
opinion to the transfer agent promptly after the Delegend Date (as defined
below) if required by the Company and/or the transfer agent to effect the
removal of the legend hereunder, which opinion shall be in form and substance
reasonably acceptable to the Holder. If such Common Stock may be sold under Rule
144 (assuming cashless exercise of the New Warrants) without the requirement for
the Company to be in compliance with the current public information required
under Rule 144 or if such legend is not otherwise required under applicable
requirements of the Securities Act (including judicial interpretations and
pronouncements issued by the staff of the Commission) then such Common Stock
shall be issued free of all legends. The Company agrees that following the
Delegend Date or at such time as such legend is no longer required under this
Section 2.4(b), it will, no later than two  (2) Trading Days following the
delivery by the Holder to the Company or the transfer agent of a certificate
representing the Common Stock underlying the New Warrants issued with a
restrictive legend (such second Trading Day, the “Legend Removal Date”), deliver
or cause to be delivered to the Holder a certificate representing such shares
that is free from all restrictive and other legends or, at the request of the
Holder shall credit the account of the Holder’s prime broker with the Depository
Trust Company System as directed by the Holder. The Company may not make any
notation on its records or give instructions to the transfer agent that enlarge
the restrictions on transfer set forth in this Section 2.4(b).   “Delegend Date”
means the earliest of the date that (a) a registration statement with respect to
the Common Stock has been declared effective by the Commission or (b) all of the
Common Stock has been sold pursuant to Rule 144 or may be sold pursuant to Rule
144 without the requirement for the Company to be in compliance with the current
public information required under Rule 144 and without volume or manner-of-sale
restrictions or (c) following the six (6) month anniversary of (I) the Closing
Date if a New Warrant is exercised pursuant to a cashless exercise or (II) the
date of the related cash exercise of the New Warrants provided, in each case
that the applicable holder of the New Warrants or the Common Stock, as the case
may be, is not an Affiliate of the Company, the Company is in compliance with
the current public information required under Rule 144 (“Current Public
Information Requirement”) and all such Common Stock may be sold pursuant to Rule
144 or an exemption from registration under Section 4(a)(1) of the Securities
Act without volume or manner-of-sale restrictions; provided, further, however,
that if the Company fails to comply with the Current Public Information
Requirement at any time following the applicable six (6) month anniversary set
forth above and the one (1) year anniversary of the Closing Date, the Company
shall promptly provide notice to the Holder and the Holder undertakes not to
sell such Common Stock pursuant to Rule 144 until the Company notifies the
Holder that it has regained compliance with the Current Public Information
Requirement; and provided further, that if a delegending is in effect solely as
the result of the effectiveness of a registration statement covering the resale
of any Common Stock, the Holder undertakes not to sell any such Common Stock if
the Holder is notified or otherwise becomes aware that such registration
statement has been withdrawn or suspended, contains a material misstatement or
omission or has become stale.  The Holder

3

--------------------------------------------------------------------------------

 

agrees with the Company that the Holder will sell or transfer any New Warrants
or shares of Common Stock underlying New Warrants pursuant to either the
registration requirements of the Securities Act, including any applicable
prospectus delivery requirements, or an exemption therefrom, and that if such
securities are sold pursuant to a registration statement, they will be sold in
compliance with the plan of distribution set forth therein, and acknowledges
that the removal of the restrictive legend from certificates representing any
such securities as set forth in this Section 2.4 or otherwise  is predicated
upon the Company’s reliance upon this understanding. 

Section 2.4 Filing of Form 8-K. Prior to 9:00  am ET on November 21, 2018, the
Company shall issue a Current Report on Form 8-K, reasonably acceptable to the
Holder disclosing the material terms of the transactions contemplated hereby,
which shall include this form of Agreement (the “8-K Filing”). From and after
the issuance of the 8-K Filing, the Company represents to the Holder that it
shall not be in possession of any material, nonpublic information received from
the Company, any of its Subsidiaries (as defined below) or any of their
respective officers, directors, employees or agents, that is not disclosed in
the 8-K Filing. In addition, effective upon the filing of the 8-K Filing, the
Company acknowledges and agrees that any and all confidentiality or similar
obligations under any agreement, whether written or oral, between the Company,
any of its Subsidiaries or any of their respective officers, directors,
employees or agents, on the one hand, and the Holder or any of its Affiliates,
on the other hand, shall terminate.  The Company shall not, and shall cause each
of its Subsidiaries and its and each of their respective officers, directors,
employees and agents, not to, provide the Holder with any material, nonpublic
information regarding the Company or any of its Subsidiaries from and after the
date hereof without the express prior written consent of the Holder. To the
extent that the Company, any of its Subsidiaries or any of their respective
officers, directors, employees or agents, delivers any material, non-public
information to the Holder without the Holder’s consent, the Company hereby
covenants and agrees that the Holder shall not have any duty of confidentiality
with respect to, or a duty not to trade on the basis of, such material,
non-public information.  As used herein, “Subsidiary” means any subsidiary of
the Company, and shall, where applicable, also include any direct or indirect
subsidiary of the Company formed or acquired after the date hereof.

ARTICLE III

REPRESENTATIONS AND WARRANTIES

Section 3.1 Representations and Warranties of the Company. The Company hereby
makes the representations and warranties set forth below to the Holder that as
of the date of its execution of this Agreement:

(a) Authorization; Enforcement. The Company has the requisite corporate power
and authority to enter into and to consummate the transactions contemplated by
this Agreement and otherwise to carry out its obligations hereunder and
thereunder. The execution and delivery of this Agreement by the Company and the
consummation by it of the transactions contemplated hereby have been duly
authorized by all necessary action on the part of such Company and no further
action is required by such Company, its board of directors or its stockholders
in connection therewith other than in connection with (i) the filings required
pursuant to Section 2.4 of this Agreement, (ii) application to the NYSE American
for the listing of the New Warrant Shares for trading thereon in the time and
manner required thereby and (iii) such filings as are required to be made under
applicable state securities laws (the “Required Approvals”). This Agreement has
been duly executed by the Company and, when delivered in accordance with the
terms hereof will constitute the valid and binding obligation of the Company
enforceable against the Company in accordance with its terms except (i) as
limited by general equitable principles and applicable bankruptcy, insolvency,
reorganization, moratorium and other laws of general application affecting
enforcement of creditors’ rights generally, (ii) as limited by laws relating to
the availability of specific

4

--------------------------------------------------------------------------------

 

performance, injunctive relief or other equitable remedies and (iii) insofar as
indemnification and contribution provisions may be limited by applicable law.

(b) Organization. The Company is a duly organized and validly existing
corporation in good standing under the laws of the State of Delaware.

(c) Registration Statement. The Warrant Shares are registered for issuance on a
Form S-1 Registration Statement (the “Registration Statement”) and the Company
knows of no reasons why such registration statement shall not remain available
for the issuance of such Warrant Shares for the foreseeable future. The Company
shall use commercially reasonable efforts to keep the Registration Statement
effective and available for the issuance of the Warrant Shares underlying the
Original Warrants until all Original Warrants are exercised.  If the Company is
unable to keep the Registration Statement effective and available despite their
commercially reasonable efforts, either the Company or the Holder may, by
delivering written notice to the other, terminate all remaining obligations
under this Agreement. 

(d) No Conflicts. The execution, delivery and performance of this Agreement by
the Company and the consummation by the Company of the transactions contemplated
hereby do not and will not: (i) conflict with or violate any provision of the
Company’s certificate or articles of incorporation, bylaws or other
organizational or charter documents, or (ii) conflict with, or constitute a
default (or an event that with notice or lapse of time or both would become a
default) under, result in the creation of any lien upon any of the properties or
assets of the Company, or give to others any rights of termination, amendment,
acceleration or cancellation (with or without notice, lapse of time or both) of,
any material agreement, credit facility, debt or other material instrument
(evidencing Company debt or otherwise) or other material understanding to which
the Company is a party or by which any property or asset of the Company is bound
or affected, or (iii) subject to the Required Approvals, conflict with or result
in a violation of any law, rule, regulation, order, judgment, injunction, decree
or other restriction of any court or governmental authority to which the Company
is subject (including federal and state securities laws and regulations), or by
which any property or asset of the Company is bound or affected, except in the
case of each of clauses (ii) and (iii), such as would not have or reasonably be
expected to result in (i) a material adverse effect on the legality, validity or
enforceability of this Agreement, (ii) a material adverse effect on the results
of operations, assets, business or condition (financial or otherwise) of the
Company and its subsidiaries, taken as a whole, or (iii) a material adverse
effect on the Company's ability to perform in any material respect on a timely
basis its obligations under this Agreement (any of (i), (ii) or (iii), a
“Material Adverse Effect”).

(e) Disclosure. Except with respect to the material terms and conditions of the
transactions contemplated by this Agreement, the Company confirms that neither
it nor any other Person acting on its behalf has provided any of Holder or their
agents or counsel with any information that it believes constitutes or might
constitute material, non-public information. The Company understands and
confirms that the Holder will rely on the foregoing representation in effecting
transactions in securities of the Company. As of the date of this Agreement, all
of the disclosure when furnished by or on behalf of the Company to the Holder
regarding the Company and its Subsidiaries, their respective businesses and the
transactions contemplated hereby, including but not limited to the disclosure
set forth in the SEC Reports, is true and correct and does not contain any
untrue statement of a material fact or omit to state any material fact necessary
in order to make the statements made therein, in light of the circumstances
under which they were made, not misleading. As used herein, “SEC Reports” means
all reports, schedules, forms, statements and other documents required to be
filed by the Company as of the date of this Agreement with the Commission
pursuant to the reporting requirements of the 1934 Act, including all exhibits
included therein and financial statements, notes and schedules thereto and
documents incorporated by reference therein.

(f) Issuance of Securities.  The issuance of the New Warrants are duly
authorized and, upon issuance in accordance with the terms of this Agreement,
the New Warrants shall be validly issued and

5

--------------------------------------------------------------------------------

 

free from all preemptive or similar rights (except for those which have been
validly waived prior to the date hereof), taxes, liens and charges and other
encumbrances with respect to the issue thereof, other than restrictions on
transfer under applicable state and federal securities laws and liens or
encumbrances created by or imposed by the Holder.  As of the Closing Date, a
number of shares of Common Stock shall have been duly authorized and reserved
for issuance which equals or exceeds the maximum number of Warrant Shares
issuable upon exercise of the New Warrants (without taking into account any
limitations on the exercise of the New Warrants set forth therein).  Upon
exercise of the New Warrants in accordance with the New Warrants, the New
Warrant Shares when issued will be validly issued, fully paid and nonassessable
and free from all preemptive or similar rights, taxes, liens, charges and other
encumbrances with respect to the issue thereof, other than restrictions on
transfer under applicable state and federal securities laws and liens or
encumbrances created by or imposed by the Holder, with the holders being
entitled to all rights accorded to a holder of Common Stock.  Assuming the
accuracy of each of the representations and warranties set forth in Section 3.2
of this Agreement, the offer and issuance by the Company of the New Warrants is
exempt from registration under the 1933Act.

(g) No General Solicitation.  Neither the Company, nor any of its Subsidiaries
or Affiliates, nor any Person acting on its or their behalf, has engaged in any
form of general solicitation or general advertising (within the meaning of
Regulation D) in connection with the offer or sale of the New Warrants.

(h) No Integrated Offering.  None of the Company, its Subsidiaries or any of
their Affiliates, nor any Person acting on their behalf has, directly or
indirectly, made any offers or sales of any security or solicited any offers to
buy any security, under circumstances that would require registration of the
issuance of any of the New Warrants or the New Warrant Shares (collectively, the
“New Securities”) under the Securities Act, whether through integration with
prior offerings or otherwise, or cause this offering of the New Securities to
require approval of shareholders of the Company for purposes of the Securities
Act or any applicable shareholder approval provisions, including, without
limitation, under the rules and regulations of any exchange or automated
quotation system on which any of the securities of the Company are listed or
designated for quotation.  None of the Company, its Subsidiaries, their
Affiliates nor any Person acting on their behalf will take any action or steps
that would require registration of the issuance of any of the New Securities
under the Securities Act or cause the offering of any of the New Securities to
be integrated with other offerings for purposes of any such applicable
shareholder approval provisions.

(i) No Disqualification Events.  With respect to Securities to be offered and
sold hereunder in reliance on Rule 506(b) under the Securities Act  (“Regulation
D Securities”), none of the Company, any of its predecessors, any affiliated
issuer, any director, executive officer, other officer of the Company
participating in the offering hereunder, any beneficial owner of 20% or more of
the Company's outstanding voting equity securities, calculated on the basis of
voting power, nor any promoter (as that term is defined in Rule 405 under the
Securities Act) connected with the Company in any capacity at the time of sale
(each, an “Issuer Covered Person” and, together, “Issuer Covered Persons”) is
subject to any of the “Bad Actor” disqualifications described in Rule
506(d)(1)(i) to (viii) under the Securities Act (a “Disqualification Event”),
except for a Disqualification Event covered by Rule 506(d)(2) or (d)(3). The
Company has exercised reasonable care to determine whether any Issuer Covered
Person is subject to a Disqualification Event.  The Company has complied, to the
extent applicable, with its disclosure obligations under Rule 506(e), and has
furnished to the Holder a copy of any disclosures provided thereunder.

Section 3.2 Representations and Warranties of the Holder. The Holder hereby
makes the representations and warranties set forth below to the Company that as
of the date of its execution of this Agreement. 

(a) Organization; Due Authorization.  The Holder is either an individual or an
entity duly incorporated or formed, validly existing and in good standing under
the laws of the jurisdiction of its 

6

--------------------------------------------------------------------------------

 

incorporation or formation with full right, corporate, partnership, limited
liability company or similar power and authority to enter into and to consummate
the transactions contemplated by this Agreement and otherwise to carry out its
obligations hereunder. The Holder represents and warrants that (i) the execution
and delivery of this Agreement by it and the consummation by it of the
transactions contemplated hereby have been duly authorized by all necessary
action on its behalf and (ii) this Agreement has been duly executed and
delivered by the Holder and constitutes the valid and binding obligation of the
Holder, enforceable against it in accordance with its terms.

(b) Understandings or Arrangements. The Holder is acquiring the Securities as
principal for its own account and has no direct or indirect arrangement or
understandings with any other persons to distribute or regarding the
distribution of such Securities (this representation and warranty not
limiting the Holder’s right to sell the Securities pursuant to a registration
statement or otherwise in compliance with applicable federal and state
securities laws). The Holder is acquiring the Securities hereunder in
the ordinary course of its business.

(c) No Conflicts.  The Holder represents and warrants that the execution,
delivery and performance of this Agreement by the Holder and the consummation by
the Holder of the transactions contemplated hereby do not and will not:
(i) conflict with or violate any provision of the Holder’s organizational or
charter documents, or (ii) conflict with or result in a violation of any
agreement, law, rule, regulation, order, judgment, injunction, decree or other
restriction of any court or governmental authority which would interfere with
the ability of the Holder to perform its obligations under this Agreement.

(d)  Access to Information.  The Holder acknowledges that it has had the
opportunity to review this Agreement and the SEC Reports and has been afforded
(i) the opportunity to ask such questions as it has deemed necessary of, and to
receive answers from, representatives of the Company concerning the terms and
conditions of the exercise of the Original Warrants and the merits and risks of
investing in the Warrant Shares, the terms and conditions of the offering of the
Securities and the merits and risks of investing in the Securities; (ii) access
to information about the Company and its financial condition, results of
operations, business, properties, management and prospects sufficient to enable
it to evaluate its investment; and (iii) the opportunity to obtain such
additional information that the Company possesses or can acquire without
unreasonable effort or expense that is necessary to make an informed investment
decision with respect to the investment. The Holder acknowledges and agrees that
neither Oppenheimer & Co., Inc. (the “Advisor”) nor any Affiliate of the Advisor
has provided the Holder with any information or advice with respect to the
Securities nor is such information or advice necessary or desired. Neither the
Advisor nor any Affiliate has made or makes any representation as to the Company
or the quality of the securities issued and issuable hereunder and the Advisor
and any Affiliate may have acquired non-public information with respect to the
Company which the Holder agrees need not be provided to it. In connection with
the issuance of the securities hereunder to the Holder, neither the Advisor nor
any of its Affiliates has acted as a financial advisor or fiduciary to the
Holder.

 

(e)  Holder Status.  The Holder represents and warrants that at the time the
Holder was offered the Securities, it was, and as of the date hereof it is, and
on each date on which it exercises any New Warrants, it was or will be an
“accredited investor” as defined in Rule 501 under the Securities Act.

 

(f)  Knowledge.  The Holder, either alone or together with its representatives,
has such knowledge, sophistication and experience in business and financial
matters so as to be capable of evaluating the merits and risks of the
prospective investment in the Warrant Shares, and has so evaluated the merits
and risks of such investment. The Holder is able to bear the economic risk of an
investment in the Warrant Shares and, at the present time, is able to afford a
complete loss of such investment.

7

--------------------------------------------------------------------------------

 

ARTICLE IV

MISCELLANEOUS

 

Section 4.1 Subsequent Equity Sales. 

(a) From the date hereof until 70 Trading Days after the Closing Date (the
“Restricted Period”), neither the Company nor any Subsidiary shall issue, enter
into any agreement to issue or announce the issuance or proposed issuance of any
shares of Common Stock or Common Stock Equivalents; provided however, that such
Restricted Period shall terminate on the Trading Day following the date that the
Common Stock’s Closing Sale Price (each as defined in the New Warrants) exceeds
$0.25 (subject to adjustment for forward and reverse stock splits and the like)
for a period of 10 consecutive Trading Days.  As used herein “Common Stock
Equivalents” means any securities of the Company or the Subsidiaries which would
entitle the holder thereof to acquire at any time Common Stock, including,
without limitation, any debt, preferred stock, right, option, warrant or other
instrument that is at any time convertible into or exercisable or exchangeable
for, or otherwise entitles the holder thereof to receive, Common Stock.  In
addition, if the Restricted Period has not been earlier terminated pursuant to
the proviso in the first sentence this Section 4.1(a), from the date hereof
until the 60th Trading Day after the Closing Date, the Company shall not,
directly or indirectly, file any registration statement with the Securities and
Exchange Commission (“SEC”), or file any amendment or supplement thereto or
cause any registration statement or amendment thereto to be declared effective
by the SEC, or grant any registration rights to any Person that can be exercised
prior to such time as set forth above; provided however, that the foregoing
shall not prevent the Company from filing during the Restricted Period (i) a
registration statement on Form S-8,  and (ii) a registration statement on Form
S-3 to replace the original proposed maximum aggregate offering amount
originally registered under that certain registration statement on Form S-3
(333-209026) pursuant to Rule 415(a)(5) and (6) under the Securities Act,
provided that such registration statement shall not be filed before January 30,
2019 (if the Restricted Period has not earlier terminated pursuant to this
Section 4.1(a)).

 

(b) Notwithstanding the foregoing, this Section 4.1 shall not apply in respect
of an Exempt Issuance.  “Exempt Issuance” means the issuance of (a) shares of
Common Stock or options to employees, officers or directors of the Company
pursuant to any stock or option plan duly adopted for such purpose, by a
majority of the non-employee members of the Board of Directors or a majority of
the members of a committee of non-employee directors established for such
purpose for services rendered to the Company, (b) securities upon the exercise
or exchange of or conversion of any Securities issued hereunder and/or other
securities exercisable or exchangeable for or convertible into shares of Common
Stock issued and outstanding on the date of this Agreement, provided that such
securities have not been amended since the date of this Agreement to increase
the number of such securities or to decrease the exercise price, exchange price
or conversion price of such securities (other than in connection with stock
splits or combinations) or to extend the term of such securities, and (c)
securities issued pursuant to acquisitions or strategic transactions approved by
a majority of the disinterested directors of the Company, provided that any such
issuance shall only be to a Person (or to the equity holders of a Person) which
is, itself or through its subsidiaries, an operating company or an owner of an
asset in a business synergistic with the business of the Company and shall
provide to the Company additional benefits in addition to the investment of
funds, but shall not include a transaction in which the Company is issuing
securities primarily for the purpose of raising capital or to an entity whose
primary business is investing in securities; provided, that such securities are
issued as “restricted securities” (as defined in Rule 144) and the recipients of
such securities are not

8

--------------------------------------------------------------------------------

 

granted registration rights that enable or require the filing of a resale
registration statement until after the time period specified in the first
sentence of Section 4.1(a) above.

Section 4.2 Public Information.  At any time commencing on the six (6) month
anniversary of the date hereof and ending when no New Warrants remain
outstanding, if there is no effective registration statement covering the resale
of the New Warrant Shares and the Company (i) shall fail for any reason to
satisfy the current public information requirement under Rule 144(c) or (ii) the
Company shall fail to satisfy any condition set forth in Rule 144(i)(2) (a
“Public Information Failure”) then, in addition to such Holder’s other available
remedies, the Company shall pay to a Holder, in cash, as partial liquidated
damages and not as a penalty, by reason of any such delay in or reduction of its
ability to sell the New Warrant Shares, an amount in cash equal to two percent
(2.0%) of the product of (i) the maximum number of New Warrant Shares issuable
upon a cash exercise of the New Warrants and (ii) the last Closing Sale Price
less the Exercise Price of the New Warrants immediately prior to the time of the
initial Public Information Failure and on every thirtieth (30th) day (pro-rated
for periods totaling less than thirty (30) days) thereafter until the earlier of
(a) the date such Public Information Failure is cured and (b) such time that
such public information is no longer required for the Holders to transfer the
New Warrant Shares pursuant to Rule 144.  The payments to which a Purchaser
shall be entitled pursuant to this Section 4.2 are referred to herein as “Public
Information Failure Payments.”  Public Information Failure Payments shall be
paid on the earlier of (i) the last day of the calendar month during which such
Public Information Failure Payments are incurred and (ii) the third (3rd)
Trading Day after the event or failure giving rise to the Public Information
Failure Payments is cured.  In the event the Company fails to make Public
Information Failure Payments in a timely manner, such Public Information Failure
Payments shall bear interest at the rate of 1.5% per month (pro-rated for
partial months) until paid in full. Nothing herein shall limit such Holder’s
right to pursue actual damages for the Public Information Failure, and such
Holder shall have the right to pursue all remedies available to it at law or in
equity including, without limitation, a decree of specific performance and/or
injunctive relief.

Section 4.3 Resale Registration Statement. The Company reserves the right at any
time to file and cause to become effective a registration statement covering the
resale of the New Warrant Shares.  Holder hereby covenants and agrees to
promptly provide the Company with any material information that is reasonably
required to be provided in such registration statement with respect to such
Holder, including the completion, execution, acknowledgement and delivery of
customary selling stockholder questionnaires and other documents, certificates,
instruments, representations and warranties and indemnities as may be reasonably
requested by the Company in connection with the filing of such registration
statement, including, without limitation, representations and warranties (or
indemnities with respect thereto) in connection with (i) Holder’s ownership of
New Warrant Shares to be transferred free and clear of all liens, claims and
encumbrances, (ii) Holder’s power and authority to effect such transfer, and
(iii) such matters pertaining to compliance with applicable law by Holder. The
Company may require Holder, by written notice given to Holder not less than
seven (7) Trading Days prior to the filing date of a registration statement, to
promptly, and in any event within five (5) Trading Days after receipt of such
notice, furnish in writing to the Company such information regarding the
distribution of the New Warrant Shares as the Company may from time to time
reasonably request and such other information as may be legally required in
connection with such registration.  Notwithstanding anything to the contrary
contained herein, (i) the provisions of this Section 4.3 shall not be applicable
to the extent that the Holder is required to be named as an underwriter in any
resale registration statement, and (ii) any indemnities required to be provided
in this Section 4.3 by the Holder shall apply solely with respect to written
information provided by the Holder specifically for use in such registration
statement, and such indemnities shall be limited to net proceeds received by
such Holder with respect to sales of New Warrant Shares.

9

--------------------------------------------------------------------------------

 

Section 4.4 Notices. Any and all notices or other communications or deliveries
required or permitted to be provided hereunder shall be made by email to the
email address of the Holder set forth on Holders’ signature page.

Section 4.5 Survival. All warranties and representations (as of the date such
warranties and representations were made) made herein or in any certificate or
other instrument delivered by it or on its behalf under this Agreement shall be
considered to have been relied upon by the parties hereto and shall survive the
issuance of the New Warrants. This Agreement shall inure to the benefit of and
be binding upon the successors and permitted assigns of each of the parties;
provided however that no party may assign this Agreement or the obligations and
rights of such party hereunder without the prior written consent of the other
parties hereto.

Section 4.6 Execution. This Agreement may be executed in two or more
counterparts, all of which when taken together shall be considered one and the
same agreement and shall become effective when counterparts have been signed by
each party and delivered to the other party, it being understood that both
parties need not sign the same counterpart. In the event that any signature is
delivered by facsimile transmission, such signature shall create a valid and
binding obligation of the party executing (or on whose behalf such signature is
executed) with the same force and effect as if such facsimile signature page
were an original thereof.

Section 4.7  Severability. If any provision of this Agreement is held to be
invalid or unenforceable in any respect, the validity and enforceability of the
remaining terms and provisions of this Agreement shall not in any way be
affected or impaired thereby and the parties will attempt to agree upon a valid
and enforceable provision that is a reasonable substitute therefor, and upon so
agreeing, shall incorporate such substitute provision in this Agreement.

Section 4.8  Governing Law. All questions concerning the construction, validity,
enforcement and interpretation of this Agreement shall be determined pursuant to
the Governing Law provision of the New Warrants.  

Section 4.9 Entire Agreement. The Agreement, together with the exhibits and
schedules thereto, contain the entire understanding of the parties with respect
to the subject matter hereof and supersede all prior agreements and
understandings, oral or written, with respect to such matters, which the parties
acknowledge have been merged into such documents, exhibits and schedules.

 

Section 4.10 Construction. The headings herein are for convenience only, do not
constitute a part of this Agreement and shall not be deemed to limit or affect
any of the provisions hereof. The language used in this Agreement will be deemed
to be the language chosen by the parties to express their mutual intent, and no
rules of strict construction will be applied against any party.

Section 4.11 Fees and Expenses. Except as expressly set forth herein, each party
shall pay the fees and expenses of its advisers, counsel, accountants and other
experts, if any, and all other expenses incurred by such party incident to the
negotiation, preparation, execution, delivery and performance of this Agreement.
The Company shall pay all transfer agent fees, stamp taxes and other taxes and
duties levied in connection with the delivery of any Warrant Shares.

 

10

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, the undersigned have executed this Warrant Exercise
Agreement as of the date first written above.

COMPANY:

BIOPHARMX CORPORATION

By:  _______________________________

Name:   ____________________________

Title:  ______________________________

 

Bank Account and Wire Instructions

 

11

--------------------------------------------------------------------------------

 

[HOLDER SIGNATURE PAGES TO BPMX 

WARRANT EXERCISE AGREEMENT]

IN WITNESS WHEREOF, the undersigned have caused this Agreement to be duly
executed by their respective authorized signatories as of the date first
indicated above.

 

 

 

 

Name of Holder:

 

 

 

 

 

Signature of Authorized Signatory of Holder:

 

 

 

 

 

Name of Authorized Signatory:

 

 

 

 

 

Title of Authorized Signatory:

 

 

 

 

 

Email Address of Holder:

 

 

 

 

 

Number of Original Warrants held:

 

 

 

Number of Original Warrants deemed exercised:

 

 

 

 

 

 

 

 

Aggregate Exercise Price of  Warrants deemed Exercised:

 

 

 

 

 

 

 

Warrant Shares underlying  Warrants deemed exercised:

 

                                                     

 

Instructions for Warrant Shares to be issued upon initial exercise of Original
Warrants:_________________

 

 

Number of New Warrants to be issued to Holder upon deemed exercise:
                             

 

 

Address for Delivery of New Warrants for Holder:
_______________________________________________

 

 

12

--------------------------------------------------------------------------------