Exhibit 10.1

SECURITIES PURCHASE AGREEMENT

This SECURITIES PURCHASE AGREEMENT (this “Agreement”) is dated as of June 20,
2019, between DURECT Corporation, a Delaware corporation (the “Company”), and
each purchaser identified on the signature pages hereto (each, including its
successors and assigns, an “Investor” and collectively, the “Investors”).

WHEREAS, subject to the terms and conditions set forth in this Agreement and
pursuant to an effective registration statement under the Securities Act of
1933, as amended (the “Securities Act”), the Company desires to issue and sell
to each Investor, and each Investor, severally and not jointly, desires to
purchase from the Company, securities of the Company as more fully described in
this Agreement;

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

1.The Company has authorized the sale and issuance of up to 29,000,000 shares
(the “Shares”) of the Company’s common stock, $0.0001 par value per share (the
“Common Stock”), for a purchase price of $0.52 per share (the “Per Share
Purchase Price”).  The sale and issuance of the Shares have been registered
under the Securities Act, pursuant to the Registration Statement of the Company
on Form S-3 (No. 333-226518), including all amendments, exhibits and schedules
thereto, the documents otherwise deemed to be a part thereof or included therein
by the rules and regulations (the “Rules and Regulations”) of the Securities and
Exchange Commission (the “Commission”) and any registration statement relating
to the sale and issuance of the Shares to the Investors and filed pursuant to
Rule 462(b) under the Rules and Regulations (collectively, the “Registration
Statement”).

2.On the Closing Date (as defined below), subject to the terms and conditions
set forth herein, the Company agrees to sell, and each Investor, severally and
not jointly, agrees to purchase, the number of Shares listed opposite such
Investor’s name on the Schedule of Investors attached hereto as Exhibit A.  Each
Investor shall deliver to the Company via wire transfer of immediately available
funds, the aggregate purchase price for the Shares purchased by such Investor as
set forth in Exhibit A (such Investor’s “Subscription Amount”), and the Company
shall deliver to each Investor its respective Shares.  The Company and each
Investor shall deliver the other items set forth in Section 5 deliverable at the
Closing.  The Closing shall occur at the offices of King & Spalding LLP, 601 S.
California Ave., Palo Alto, California, or such other location as the parties
shall mutually agree.  “Closing Date” means the Trading Day on which all
conditions precedent to (i) the Investors’ obligations to pay their respective
Subscription Amounts; and (ii) the Company’s obligations to deliver the Shares
to the Investors have been satisfied or waived, but in no event later than the
third Trading Day following the date hereof.  “Trading Day” means a day on which
the Nasdaq Global Market is open for trading.

3.The Company has filed with the Commission a prospectus (the “Base Prospectus”)
and will promptly file a final prospectus supplement (collectively with the Base
Prospectus, the “Prospectus”) with respect to the Registration Statement in
conformity with the Securities Act, including Rule 424(b) thereunder.  The
Company will cause to be delivered or made available a

 

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copy of the Prospectus to the Investors prior to Closing and the Investors
hereby consent to the receipt of the Prospectus in portable document format
(.pdf) via e-mail.

4.At or prior to the Applicable Time (as defined below), the Company prepared
the following information (collectively, the “Time of Sale Information”): (a)
the Base Prospectus and (b) each “free-writing prospectus” (as defined pursuant
to Rule 405 under the Securities Act) listed on Annex A hereto.  “Applicable
Time” means 8:00 A.M. in New York City, on June 20, 2019.

5.Closing Deliverables.

(a)On or prior to the Closing Date, the Company shall deliver or cause to be
delivered to each Investor the following:

 

(i)

this Agreement duly executed by the Company;

 

(ii)

a legal opinion of Company Counsel, in form agreed with the Investors;

 

(iii)

a copy of the irrevocable instructions to Computershare, the transfer agent of
the Company (the “Transfer Agent”), instructing the Transfer Agent to deliver on
an expedited basis via The Depository Trust Company Deposit or Withdrawal at
Custodian system (“DWAC”) the number of Shares equal to such Investor’s
Subscription Amount divided by the Per Share Purchase Price, registered in the
name of such Investor; and

 

(iv)

the Prospectus (which may be delivered in accordance with Rule 172 under the
Securities Act).

(b)On or prior to the Closing Date, each Investor shall deliver or cause to be
delivered to the Company the following:

 

(i)

this Agreement duly executed by such Investor; and

 

(ii)

such Investor’s Subscription Amount by wire transfer to the account specified by
the Company.

6.Closing Conditions.  The obligations of the Company and the Investors to
complete the transactions contemplated by this Agreement shall be subject to the
following.

(a)The Company’s obligation to issue and sell the Shares to each Investor shall
be subject to the following conditions being met:

 

(i)

the accuracy in all material respects on the Closing Date of the representations
and warranties of such Investor contained herein (unless made as of a specific
date, in which case such representations and warranties shall be accurate as of
such date;

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(ii)

all obligations, covenants and agreements of such Investor required to be
performed at or prior to the Closing Date shall have been performed; and

 

(iii)

the delivery by such Investor of the items set forth in Section 5(b) of this
Agreement.

(b)Each Investor’s obligations hereunder to purchase the Shares shall be subject
to the following conditions being met:

 

(i)

the accuracy in all material respects when made and on the Closing Date of the
representations and warranties of the Company contained herein (unless made as
of a specific date, in which case such representations and warranties will be
accurate as of such date);

 

(ii)

all obligations, covenants and agreements of the Company required to be
performed at or prior to the Closing Date shall have been performed;

 

(iii)

the delivery by the Company of the items set forth in Section 5(a) of this
Agreement;

 

(iv)

there shall have been no Material Adverse Effect (as defined below) with respect
to the Company since the date hereof; and

 

(v)

from the date hereof to the Closing Date, trading in the Common Stock shall not
have been suspended by the Commission or the Nasdaq Global Market, and, at any
time prior to the Closing Date, trading in securities generally as reported by
Bloomberg L.P. shall not have been suspended or limited, or minimum prices shall
not have been established on securities whose trades are reported by such
service, or on the Nasdaq Global Market, nor shall a banking moratorium have
been declared either by the United States or New York State authorities nor
shall there have occurred any material outbreak or escalation of hostilities or
other national or international calamity of such magnitude in its effect on, or
any material adverse change in, any financial market which, in each case, in the
reasonable judgment of such Investor, makes it impracticable or inadvisable to
purchase the Shares at the Closing.

7.Company Representations and Warranties.  The Company makes the following
representations, warranties and covenants to the Investors.  

(a)Subsidiaries.  There are no direct or indirect subsidiaries of the Company.

(b)Valid Existence and Good Standing of the Company.  The Company has been duly
incorporated, is validly existing as a corporation in good standing under the
laws

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of the jurisdiction of its incorporation, has the corporate power and authority
to own its property and to conduct its business as described in the Prospectus
and is duly qualified to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or leasing of
property requires such qualification, except to the extent that the failure to
be so qualified or in good standing would not have a material adverse effect on
the business, properties, management, financial position, stockholders’ equity,
results of operations or prospects of the Company, taken as a whole, or on the
performance by the Company of its obligations under this Agreement (a “Material
Adverse Effect”).

(c)Execution and Delivery of the Agreement.  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.  The execution and delivery of this Agreement by the Company and the
consummation by it of the transactions contemplated hereunder have been duly
authorized by all necessary action on the part of the Company.  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 as may be
limited by any bankruptcy, insolvency, reorganization, moratorium, fraudulent
conveyance or other similar laws affecting the enforcement of creditors’ rights
generally or by general principles of equity.

(d)Securities Laws Disclosure; Publicity.  The Company shall (i) before 8:30
A.M., New York City time, on the same Trading Day as the date hereof, issue a
press release disclosing all material aspects of the transactions contemplated
hereby; (ii) within the time required by the Exchange Act of 1934, as amended
(the “Exchange Act”), file with the Commission a Current Report on Form 8-K,
disclosing the material terms and conditions of the transactions contemplated
hereby and including this Agreement as an exhibit thereto; and (iii) make such
other filings and notices in the manner and time required by the Commission with
respect to the transactions contemplated hereby.  The Company shall not publicly
disclose the name of the Investors, or include the name of the Investors in any
filing with the Commission or any regulatory agency or Trading Market, without
the prior written consent of the Investors, except (x) as required by U.S.
federal securities law or Trading Market regulations, in which case the Company
shall provide the Investors with prior notice thereof; or (y) for disclosures
consistent with prior disclosures that have been approved by the Investors in
accordance with this Section 7(d).  

(e)No Disclosure of Material Non-Public Information.  Except with respect to the
material terms and conditions of the transactions contemplated by this
Agreement, neither the Company, nor any other Person acting on the Company’s
behalf, has provided or will knowingly provide any Investor or its agents or
counsel with any information that the Company believes constitutes material
non-public information, unless prior thereto such Investor shall have entered
into a written agreement with the Company regarding the confidentiality and use
of such information.  The Company understands and confirms that the Investors
shall rely on this Section 7(e) in effecting transactions in securities of the
Company.  

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(f)Time of Sale Information.  The Time of Sale Information, at the Applicable
Time, did not contain any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading.  No order
preventing or suspending the use of any of the Time of Sale Information has been
issued by the Commission.

(g)Issuer Free Writing Prospectus.  The Company (including its agents and
representatives) has not made, used, prepared, authorized, approved or referred
to and will not prepare, make, use, authorize, approve or refer to any “written
communication” (as defined in Rule 405 under the Securities Act) that
constitutes an offer to sell or solicitation of an offer to buy the Shares (each
such communication by the Company or its agents and representatives, an “Issuer
Free Writing Prospectus”) other than the documents listed on Annex A
hereto.  Each such Issuer Free Writing Prospectus, as of its issue date and at
all subsequent times through the completion of the offer and sale of the Shares
did not, does not and will not include any information that conflicted,
conflicts or will conflict with the information contained in the Registration
Statement, the Time of Sale Information or the Prospectus.  

(h)S-3 Eligibility.  At the earliest time after the filing of the Registration
Statement that the Company made a bona fide offer (within the meaning of Rule
164(h)(2) under the Securities Act) of the Shares, the Company was not an
“ineligible issuer” as defined in Rule 405 under the Securities Act.

(i)Registration Statement and Prospectus.  The Registration Statement has been
declared effective by the Commission.  The Company has filed with the Commission
the Registration Statement on such form, including the Base Prospectus, for
registration under the Securities Act of the offering and sale of the
Shares.  No order suspending the effectiveness of the Registration Statement has
been issued by the Commission and no proceeding for that purpose or pursuant to
Section 8A of the Securities Act against the Company or related to the offering
has, to the knowledge of the Company, been initiated or threatened by the
Commission.  As of the applicable effective date of the Registration Statement
and any amendment thereto, the Registration Statement complied and will comply
in all material respects with the Securities Act, and did not and will not
contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the statements
therein not misleading.  As of the date of the Prospectus and any amendment or
supplement thereto and as of the Closing Date, the Prospectus will not contain
any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading.  There are no contracts or documents which are required to be
described in the Registration Statement or the Prospectus or to be filed as
exhibits thereto which have not been so described and filed as required.

(j)Incorporated Documents.  The documents incorporated by reference in the
Registration Statement, the Prospectus or the Time of Sale Information, when
they become

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effective or were filed with the Commission, as the case may be, conformed in
all material respects to the requirements of the Securities Act or the Exchange
Act, as applicable.

(k)Capitalization.  The authorized capital stock of the Company conforms as to
legal matters to the description thereof contained in the Prospectus.  The
Company has not issued any capital stock since its most recently filed periodic
report under the Exchange Act, other than pursuant to the exercise of employee
stock options under the Company’s stock incentive plans, the issuance of shares
of Common Stock to employees pursuant to the Company’s employee stock purchase
plans, pursuant to the conversion or exercise of Common Stock Equivalents (as
defined below) outstanding as of the date of the most recently filed periodic
report under the Exchange Act and pursuant to the Company’s Controlled Equity
Offering sales agreement with Cantor Fitzgerald & Co. Except as described in the
SEC Reports or as a result of the purchase and sale of the Shares, there are no
outstanding options, warrants, scrip rights to subscribe to, calls or
commitments of any character whatsoever relating to, or securities, rights or
obligations convertible into or exercisable or exchangeable for, or giving any
Person any right to subscribe for or acquire, any shares of Common Stock, or
contracts, commitments, understandings or arrangements by which the Company is
or may become bound to issue additional shares of Common Stock or Common Stock
Equivalents.  The issuance and sale of the Shares will not obligate the Company
to issue shares of Common Stock or other securities to any Person (other than
the Investors) and will not result in a right of any holder of Company
securities to adjust the exercise, conversion, exchange or reset price under any
of such securities.  All of the outstanding shares of capital stock of the
Company are duly authorized, validly issued, fully paid and nonassessable, have
been issued in compliance with all federal and state securities laws, and none
of such outstanding shares was issued in violation of any preemptive rights or
similar rights to subscribe for or purchase securities.  No further approval or
authorization of any stockholder, the board of directors or others is required
for the issuance and sale of the Shares. Except as described in the SEC Reports,
there are no stockholders agreements, voting agreements or other similar
agreements with respect to the Company’s capital stock to which the Company is a
party or, to the knowledge of the Company, between or among any of the Company’s
stockholders. No Person has any right to cause the Company to effect the
registration under the Securities Act of any securities of the Company, except
for such rights that have been satisfied by the Company pursuant to registration
statements previously filed under the Securities Act.

(l)Authorization and Valid Issuance of the Shares.  The Shares to be sold by the
Company have been duly authorized and, when issued and delivered against payment
in accordance with the terms of this Agreement, will be validly issued, fully
paid and non-assessable, and the issuance of such Shares will not be subject to
any preemptive or similar rights.

(m)Further Offerings; Integration.  The Company shall not sell, offer for sale
or solicit offers to buy any security (as defined in Section 2 of the Securities
Act) in a transaction that would be (i) integrated with the offer or sale of the
Shares for purposes of the rules and regulations of the Nasdaq Capital Market or
the Nasdaq Global Market or any successor to either of the foregoing (“Trading
Market”); and (ii) would require approval of

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the Company’s stockholders prior to the closing of such other transaction,
unless such stockholder approval is obtained before the closing of such other
transaction.

(n)No Conflicts.  The execution and delivery by the Company of, and the
performance by the Company of its obligations under, this Agreement will not (i)
contravene any provision of the certificate of incorporation or by-laws of the
Company, (ii) or contravene any provision of applicable law or any judgment,
order or decree of any governmental body, agency or court having jurisdiction
over the Company, or (iii) 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 agreement,
credit facility, debt or other instrument (evidencing a Company debt or
otherwise) to which the Company is a party 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, individually or in the aggregate, have or reasonably
be expected to result in a Material Adverse Effect.

(o)No Consents Required.  No consent, approval, authorization, order,
registration or qualification of or with any court or arbitrator or governmental
or regulatory authority is required for the execution, delivery and performance
by the Company of this Agreement, the issuance by the Company of any of the
Shares or the consummation of any of the transactions contemplated by this
Agreement, except for such additional steps as may be required by the Financial
Industry Regulatory Authority (“FINRA”) or the Nasdaq Global Market, the
registration of the offer and sale of the Shares under the Securities Act and
such filings as may be required under applicable state securities laws.

(p)No Governmental Proceedings.  There are no legal or governmental proceedings
pending or, to the knowledge of the Company, threatened to which the Company is
a party or to which any of the properties of the Company is subject that are
required to be described in the Registration Statement or the Prospectus and are
not so described.

(q)Compliance.  The Company is not (i) in default under or in violation of (and
no event has occurred that has not been waived that, with notice or lapse of
time or both, would result in a default by the Company under), nor has the
Company received notice of a claim that it is in default under or that it is in
violation of, any indenture, loan or credit agreement or any other agreement or
instrument to which it is a party or by which it or any of its properties is
bound (whether or not such default or violation has been waived); (ii) in
violation of any judgment, decree or order of any court, arbitrator or other
governmental authority; or (iii) in violation of any statute, rule, ordinance or
regulation of any governmental authority, including without limitation all
foreign, federal, state and local laws relating to taxes, environmental
protection, occupational health and safety, product quality and safety and
employment and labor matters, except in each case as would not, individually or
in the aggregate, have or reasonably be expected to result in a Material Adverse
Effect.

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(r)Compliance with FDA Applicable Laws; Authorizations.  The Company is and at
all times has been in material compliance with all statutes, rules, regulations
and orders applicable to the ownership, testing, development, manufacture,
packaging, processing, use, distribution, marketing, labeling, promotion, sale,
offer for sale, storage, import, export or disposal of any product manufactured
or distributed by or for the Company (“FDA Applicable Laws”), and has not
received, and does not know of any reasonable basis for, any Form FDA-483 from
the U.S. Food and Drug Administration (the “FDA”), notice of adverse finding,
warning letter, untitled letter, import alert or detention, export certificate
denial, or other correspondence or notice from any court or arbitrator or
governmental or regulatory authority or third party alleging or asserting
material noncompliance with any FDA Applicable Laws or any licenses, exemptions,
certificates, approvals, clearances, authorizations, permits and supplements or
amendments thereto required by any such FDA Applicable Laws
(“Authorizations”).  The Company possesses all material Authorizations required
for the operation of its business as currently conducted and such Authorizations
are valid and in full force and effect and the Company is not in violation of
any term of any such Authorizations, except for violations that, individually or
in the aggregate have not had, and would not reasonably be expected to have, a
Material Adverse Effect.  To the Company’s knowledge, no actions to withdraw or
limit any Authorizations are pending or threatened.  The applications and
submissions on which the Authorizations are based are accurate and do not
include any material misrepresentation or omission.

(s)Clinical Trials.  The descriptions in the Registration Statement and the
Prospectus of the design, status and results of clinical and pre-clinical trials
conducted by or on behalf of or sponsored by the Company, or in which the
Company have participated, are accurate and complete in all material respects
and fairly present the data derived from such trials and the Company has no
knowledge of subsequent results from such trials or results from any other
trials that are inconsistent with or otherwise call into question the results
described or referred to in the Registration Statement and the Prospectus, taken
as a whole.  The Company has operated and is currently in compliance in all
material respects with all applicable statutes, rules, regulations and policies
of the FDA and comparable drug regulatory agencies outside of the United States
to which it is subject (collectively, the “Regulatory Authorities”) and all
clinical trials have been conducted in accordance with good clinical practices,
applicable institutional review board (“IRB”) or independent ethics committee
(“IEC”) requirements, and standard medical and scientific research
procedures.  The Company has not received any notices, correspondence or other
communication from the Regulatory Authorities or any other governmental agency
or IRB or IEC which could reasonably lead to the early termination or suspension
of any ongoing clinical trials or pre-clinical studies that are described in the
Registration Statement and the Prospectus or the results of which are referred
to in the Registration Statement and the Prospectus or rejection of data from
these trials or studies and, to the Company’s knowledge, there are no reasonable
grounds for the same, including on the basis of (i) pending or submitted safety
reports concerning products manufactured or distributed by or for the Company or
(ii) results of clinical and pre-clinical trials conducted by or on behalf of or
sponsored by the Company, or in which the Company has participated.

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(t)PTO Matters.  To the knowledge of the Company, the Company has duly and
properly filed or caused to be filed with the United States Patent and Trademark
Office (the “PTO”) and, in some cases, foreign and international patent
authorities all patent applications owned or exclusively licensed at the time by
the Company related to the Company’s programs disclosed in the Prospectus as
well as the Company’s periodic reports and other information incorporated by
reference therein (the “Company Patent Applications”), except for such improper
filings and failures to file that individually or in the aggregate have not had,
and would not reasonably be expected to have, a Material Adverse Effect.  To the
knowledge of the Company, the Company has complied with the PTO’s duty of candor
and disclosure and best mode requirement for the Company Patent Applications,
and all other requirements for patentability and enforceability of any resultant
patents when issued, and has made no material misrepresentation in the Company
Patent Applications.  To the knowledge of the Company, the Company has complied
at the time of filing with the relevant foreign filing requirements underlying
patentability and enforceability of any resultant patents for the Company Patent
Applications pending in countries outside the United States, except for such
improper filings and failures to file that individually or in the aggregate have
not had, and would not reasonably be expected to have, a Material Adverse
Effect.  To the Company’s knowledge, there is no information material to a
determination of patentability regarding the Company Patent Applications not
called to the attention of the PTO during prosecution.  To the Company’s
knowledge, there is no information not called to the attention of the PTO during
prosecution which would preclude the grant of a patent for the Company Patent
Applications.  The Company has no knowledge of any information which would
preclude the Company from having clear title to the Company Patent Applications,
except for cases that individually or in the aggregate have not had, and would
not reasonably be expected to have, a Material Adverse Effect.

(u)Intellectual Property.  Except as described in the Prospectus, to the
Company’s knowledge, it owns or possesses or has rights to all material patents,
patent rights, licenses, inventions, copyrights, know-how (including trade
secrets and other unpatented and/or unpatentable proprietary or confidential
information, systems or procedures), trademarks, service marks and trade names
currently employed by it to conduct the business now operated by it.  To the
Company’s knowledge, the Company has, or has rights to use, all patents, patent
applications, trademarks, trademark applications, service marks, trade names,
trade secrets, inventions, copyrights, licenses and other intellectual property
rights and similar rights (collectively, the “Intellectual Property Rights”)
necessary or required for use to conduct its businesses as described in the
Prospectus and which the failure to so have, individually or in the aggregate,
would reasonably be expected to have a Material Adverse Effect.  The Company has
not received any notice (written or otherwise), or otherwise has knowledge, of
infringement or of conflict with asserted rights of others with respect to any
of the foregoing which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would reasonably be expected to have a
Material Adverse Effect.  The Company has not received any notice (written or
otherwise) that any of the Intellectual Property Rights has expired, terminated
or been abandoned, or is expected to expire or terminate or be abandoned, within
three (3) years from the date of this Agreement, except as would not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.  To the

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knowledge of the Company, all such Intellectual Property Rights are enforceable
and there is no existing infringement by another Person of any of the
Intellectual Property Rights, except for cases that individually or in the
aggregate have not had, and would not reasonably be expected to have, a Material
Adverse Effect.  The Company has taken reasonable security measures to protect
the secrecy, confidentiality and value of all of its intellectual properties,
except where failure to do so would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.

(v)Financial Statements.  The financial statements included or incorporated by
reference in the Prospectus, together with related schedules and notes, present
fairly in all material respects the financial position, results of operations
and changes in financial position of the Company on the basis stated therein at
the respective dates or for the respective periods to which they apply.  Such
statements and related schedules and notes have been prepared in accordance with
U.S. generally accepted accounting principles (“GAAP”) consistently applied
throughout the periods involved, except as disclosed therein, and comply in all
material respects with applicable accounting requirements and the rules and
regulations of the Commission with respect thereto as in effect at the time of
filing.  The other financial and statistical information and data set forth in
the Prospectus are, in all material respects, accurately presented and prepared
on a basis consistent with such financial statements and the books and records
of the Company.

(w)SEC Reports.  The Company has filed all reports, schedules, forms, statements
and other documents required to be filed by the Company under the Securities Act
and the Exchange Act, including pursuant to Section 13(a) or 15(d) thereof, for
the three (3) years preceding the date hereof, or such shorter period as the
Company was required by law or regulation to file such material (the foregoing
materials, including the exhibits thereto, documents incorporated by reference
therein and any prospectus, prospectus supplement, amendment or supplement filed
in relation thereto, together with the Prospectus, being collectively referred
to herein as the “SEC Reports”) on a timely basis or has received a valid
extension of such time of filing and has filed any such SEC Reports prior to the
expiration of any such extension.  As of their respective dates, the SEC Reports
complied in all material respects with the requirements of the Securities Act
and the Exchange Act, as applicable, and none of the SEC Reports, when filed,
contained any untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading.  The Company has never been an issuer subject to Rule 144(i) under
the Securities Act.  

(x)Material Changes; Undisclosed Events, Liabilities or Developments.  Since the
date of the latest audited financial statements included within the SEC Reports,
except as specifically disclosed in a subsequent SEC Report filed prior to the
date hereof, (i) there has been no event, occurrence or development that has had
or that would reasonably be expected to result in a Material Adverse Effect;
(ii) the Company has not incurred any liabilities (contingent or otherwise)
other than (A) trade payables and accrued expenses incurred in the ordinary
course of business consistent with past practice and (B) liabilities not
required to be reflected in the Company’s financial statements pursuant to GAAP
or

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disclosed in filings made with the Commission; (iii) the Company has not altered
its method of accounting; (iv) the Company has not declared or made any dividend
or distribution of cash or other property to its stockholders or purchased,
redeemed or made any agreements to purchase or redeem any shares of its capital
stock; and (v) the Company has not issued any equity securities to any officer,
director or Affiliate (as defined below), except pursuant to existing Company
stock incentive plans.  Except as may be set forth in the SEC Reports, the
Company does not have pending before the Commission any request for confidential
treatment of information.  Except for the issuance of the Shares contemplated by
this Agreement, no event, liability, fact, circumstance, occurrence or
development has occurred or exists or is reasonably expected to occur or exist
with respect to the Company or its businesses, prospects, properties,
operations, assets or financial condition that would be required to be disclosed
by the Company under applicable securities laws at the time this representation
is made or deemed made that has not been publicly disclosed at least one (1)
Trading Day prior to the date that this representation is made.

(y)Solvency.  On and immediately after the Closing Date, the Company (after
giving effect to the issuance of the Shares as described in the Time of Sale
Information) will be Solvent.  As used in this paragraph, the term “Solvent”
means, with respect to a particular date, that on such date (i) the present fair
market value (or present fair saleable value) of the assets of the Company is
not less than the total amount required to pay the liabilities of the Company on
its total existing debts and liabilities (including contingent liabilities) as
they become due and matured; (ii) the Company is able to realize upon their
assets and pay their debts and other liabilities, contingent obligations and
commitments as they mature and become due in the normal course of business;
(iii) assuming consummation of the issuance of the Shares as contemplated by
this Agreement and the Time of Sale Information, the Company is not incurring
debts or liabilities beyond its ability to pay as such debts and liabilities
mature; and (iv) the Company is not engaged in any business or transaction, and
does not propose to engage in any business or transaction, for which its
property would constitute unreasonably small capital after giving due
consideration to the prevailing practice in the industry in which the Company is
engaged.

(z)Legal Proceedings.  Except as described in the Registration Statement, the
Time of Sale Information and the Prospectus, there are no legal, governmental or
regulatory investigations, actions, suits or proceedings pending to which the
Company is or may be a party or to which any property of the Company is or may
be the subject that, individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect or materially and adversely affect
the ability of the Company to perform its obligations under this Agreement.  No
such investigations, actions, suits or proceedings are, to the knowledge of the
Company, threatened or contemplated by any governmental or regulatory authority
or threatened by others. There are no current or pending legal, governmental or
regulatory actions, suits or proceedings that are required under the Securities
Act to be described in the Registration Statement that are not so described in
the Registration Statement, the Time of Sale Information and the Prospectus.

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(aa)Labor Relations.  No labor dispute exists or, to the knowledge of the
Company, is imminent with respect to any of the employees of the Company, which
would reasonably be expected to result in a Material Adverse Effect.  None of
the Company’s employees is a member of a union that relates to such employee’s
relationship with the Company, and the Company is not a party to any collective
bargaining agreement.  To the knowledge of the Company, no executive officer of
the Company is, or is now expected to be, in violation of any material term of
any employment contract, confidentiality, disclosure or proprietary information
agreement or non-competition agreement, or any other contract or agreement or
any restrictive covenant in favor of any third party, and the continued
employment of each such executive officer does not subject the Company to any
liability with respect to any of the foregoing matters.  The Company is in
compliance with all U.S. federal, state, local and foreign laws and regulations
relating to employment and employment practices, terms and conditions of
employment and wages and hours, except where the failure to be in compliance
would not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.

(bb)Insurance.  The Company is insured by insurers of recognized financial
responsibility against such losses and risks and in such amounts as are prudent
and customary in the businesses in which the Company is engaged, including, but
not limited to, directors and officers insurance coverage.  The Company does not
have any reason to believe that it will not be able to renew its existing
insurance coverage as and when such coverage expires or to obtain similar
coverage from similar insurers as may be necessary to continue its business
without a significant increase in cost.

(cc)Tax Status.  Except for matters that would not, individually or in the
aggregate, have or reasonably be expected to result in a Material Adverse
Effect, the Company (i) has made or filed all United States federal, state and
local income and all foreign income and franchise tax returns, reports and
declarations required by any jurisdiction to which it is subject; (ii) has paid
all taxes and other governmental assessments and charges that are material in
amount, shown or determined to be due on such returns, reports and declarations;
and (iii) has set aside on its books provision reasonably adequate for the
payment of all material taxes for periods subsequent to the periods to which
such returns, reports or declarations apply.  There are no unpaid taxes in any
material amount claimed to be due by the taxing authority of any jurisdiction,
and the officers of the Company know of no basis for any such claim.

(dd)Transactions with Affiliates and Employees.  None of the officers or
directors of the Company and, to the knowledge of the Company, none of the
employees of the Company is presently a party to any transaction with the
Company (other than for services as employees, officers and directors),
including any contract, agreement or other arrangement providing for the
furnishing of services to or by, providing for rental of real or personal
property to or from, providing for the borrowing of money from or lending of
money to or otherwise requiring payments to or from any officer, director or
such employee or, to the knowledge of the Company, any entity in which any
officer, director, or any such employee has a substantial interest or is an
officer, director, trustee or partner, in each case in excess of $120,000 other
than for (i) payment of salary or consulting fees for services

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rendered; (ii) reimbursement for expenses incurred on behalf of the Company; and
(iii) other employee benefits, including stock option agreements under any stock
incentive plan of the Company.

(ee)Sarbanes-Oxley; Internal Accounting Controls.  The Company is in compliance
with any and all applicable requirements of the Sarbanes-Oxley Act of 2002 that
are effective as of the date hereof, and any and all applicable rules and
regulations promulgated by the Commission thereunder that are effective as of
the date hereof and as of the Closing Date.  The Company maintains a system of
internal accounting controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management’s general or specific
authorizations; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with GAAP and to maintain
asset accountability; (iii) access to assets is permitted only in accordance
with management’s general or specific authorization; and (iv) the recorded
accountability for assets is compared with the existing assets at reasonable
intervals and appropriate action is taken with respect to any differences.  The
Company has established disclosure controls and procedures (as defined in
Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Company and designed such
disclosure controls and procedures to ensure that information required to be
disclosed by the Company in the reports it files or submits under the Exchange
Act is recorded, processed, summarized and reported, within the time periods
specified in the Commission’s rules and forms.  The Company’s certifying
officers have evaluated the effectiveness of the disclosure controls and
procedures of the Company as of the end of the period covered by the most
recently filed periodic report under the Exchange Act (such date, the
“Evaluation Date”).  The Company presented in its most recently filed periodic
report under the Exchange Act the conclusions of the certifying officers about
the effectiveness of the disclosure controls and procedures based on their
evaluations as of the Evaluation Date.  Since the Evaluation Date, there have
been no changes in the internal control over financial reporting (as such term
is defined in the Exchange Act) of the Company that have materially affected, or
is reasonably likely to materially affect, the internal control over financial
reporting of the Company.

(ff)Foreign Corrupt Practices.  Neither the Company nor, to the knowledge of the
Company, any agent or other person acting on behalf of the Company, has (i)
directly or indirectly, used any funds for unlawful contributions, gifts,
entertainment or other unlawful expenses related to foreign or domestic
political activity; (ii) made any unlawful payment to foreign or domestic
government officials or employees or to any foreign or domestic political
parties or campaigns from corporate funds; (iii) failed to disclose fully any
contribution made by the Company (or made by any person acting on its behalf of
which the Company is aware) which is in violation of law; or (iv) violated in
any material respect any provision of the Foreign Corrupt Practices Act of 1977,
as amended (the “FCPA”).

(gg)Office of Foreign Assets Control.  Neither the Company nor, to the Company’s
knowledge, any director, officer, agent, employee or affiliate of the Company is
currently subject to any U.S. sanctions administered by the Office of Foreign
Assets Control of the U.S. Treasury Department (“OFAC”).

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(hh)Investment Company.  The Company is not, and is not an Affiliate of, and
immediately after receipt of payment for the Shares, will not be or be an
Affiliate of, an “investment company” within the meaning of the Investment
Company Act of 1940, as amended.  The Company shall conduct its business in a
manner so that it will not become an “investment company” subject to
registration under the Investment Company Act of 1940, as amended.

(ii)Use of Proceeds.  The Company will apply the net proceeds from the sale of
the Shares in accordance with Section 9(e) hereof and as described in the
Prospectus under the heading “Use of Proceeds.”

(jj)Regulation M Compliance.  The Company has not, and to its knowledge no one
acting on its behalf has, (i) taken, directly or indirectly, any action designed
to cause or to result in the stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of any of the Shares;
(ii) sold, bid for, purchased, or, paid any compensation for soliciting
purchases of, any of the Shares; or (iii) paid or agreed to pay to any Person
any compensation for soliciting another to purchase any other securities of the
Company.

(kk)Acknowledgment Regarding Each Investor’s Purchase of Shares.  The Company
acknowledges and agrees that each Investor is acting solely in the capacity of
an arm’s length purchaser with respect to this Agreement and the transactions
contemplated hereby.  The Company further acknowledges that no Investor is
acting as a financial advisor or fiduciary of the Company, or in any similar
capacity, with respect to this Agreement and the transactions contemplated
hereby and any advice given by any Investor or any of their respective
representatives or agents in connection with this Agreement and the transactions
contemplated hereby is merely incidental to the Investor’s purchase of the
Shares.  The Company further represents to each Investor that the Company’s
decision to enter into this Agreement has been based solely on the independent
evaluation of the transactions contemplated hereby by the Company and its
representatives.

(ll)No Broker’s Fees.  The Company is not a party to any contract, agreement or
understanding with any person that would give rise to a valid claim against the
Company for a brokerage commission, finder’s fee or like payment in connection
with the offering and sale of the Shares.

(mm)Exchange Listing.  As of the date hereof, the Shares have been approved for
listing on the Nasdaq Global Market, subject to official notice of
issuance.  Except as described in the Registration Statement, the Time of Sale
Information and the Prospectus, the Company has not (i) taken, directly or
indirectly, any action designed to, or that could reasonably be expected to have
the effect of, terminating the registration of the Shares under the Exchange Act
or the quotation of the Shares on the Nasdaq Global Market, except in connection
with a transfer of the listing of the Common Stock to the Nasdaq Capital Market;
or (ii) received any notification that the Commission or the Nasdaq Global
Market is contemplating terminating such registration or quotation.

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8.Investor Representations and Warranties.  Each Investor makes the following
representations, warranties and covenants to the Company as of the date hereof.

(a)Information and Sophistication.  The Investor represents that (i) it has
received or had full access to the Base Prospectus as well as the Company’s
periodic reports and other information incorporated by reference therein, prior
to or in connection with its receipt of this Agreement; (ii) it is
knowledgeable, sophisticated and experienced in making, and is qualified to
make, decisions with respect to investments in securities representing an
investment decision like that involved in the purchase of the Shares; (iii) it
is able to fend for itself in the transaction contemplated hereby; (iv) it has
the ability to bear the economic risks of its prospective investment and can
afford the complete loss of such investment; and (v) it does not have any
agreement or understanding, directly or indirectly, with any person or entity to
distribute any of the Shares.

(b)Authorization.  The Investor has the requisite power to enter into this
Agreement and to consummate the transactions contemplated hereby.  The execution
and delivery of this Agreement by the Investor and the consummation by it of the
transactions contemplated hereunder have been duly authorized by all necessary
action on the part of the Investor.  This Agreement has been executed by the
Investor and, when delivered in accordance with the terms hereof, will
constitute a valid and binding obligation of the Investor enforceable against
the Investor in accordance with its terms, except as enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors’ and contracting parties’ rights generally and
except as enforceability may be subject to general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).

(c)Independent Advisors.  The Investor understands that nothing in this
Agreement or any other materials presented to the Investor in connection with
the purchase and sale of the Shares constitutes legal, tax or investment
advice.  The Investor has consulted such legal, tax and investment advisors as
it, in its sole discretion, has deemed necessary or appropriate in connection
with its purchase of the Shares.

(d)No Conflicts.  The making, execution and performance of this Agreement by the
Investor and the consummation of the transactions contemplated herein will not
conflict with or result in a breach or violation of any of the terms and
provisions of, or constitute a default under, (i) the charter, bylaws or other
organizational documents of such Investor, as applicable, or (ii) any law,
order, rule, regulation, writ, injunction, judgment or decree of any court,
administrative agency, regulatory body, government or governmental agency or
body, domestic or foreign, having jurisdiction over such Investor or its
properties, except for any conflict, breach, violation or default which is not
reasonably likely to have a material adverse effect on such Investor’s
performance of its obligations hereunder or the consummation of the transactions
contemplated hereby.  

(e)No Short Sales.  Neither the Investor nor any Person acting on behalf of, or
pursuant to any understanding with or based upon any information received from,
the Investor has, directly or indirectly, engaged in (i) any Short Sales
involving the Company’s

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securities since the date that is the tenth (10th) trading day prior to the date
of this Agreement; or (ii) engaged in any transactions in the securities of the
Company since the time that the Investor and the Company were first in contact
with one another with respect to the transactions contemplated hereby.  The
Investor covenants that neither it, nor any Person acting on behalf of, or
pursuant to any understanding with or based upon any information received from,
the Investor will engage in any transactions in the securities of the Company
(including Short Sales) prior to the time that the transactions contemplated by
this Agreement are publicly disclosed.  In the case of an Investor that is a
multi-managed investment vehicle whereby separate portfolio managers manage
separate portions of such Investor’s assets and the portfolio managers have no
direct knowledge of the investment decisions made by the portfolio managers
managing other portions of such Investor’s assets, the representations,
warranties and covenants set forth above shall only apply with respect to the
portion of assets managed by the portfolio manager that made the investment
decision to purchase the Shares covered by this Agreement. “Short Sales”
include, without limitation, all “short sales” as defined in Rule 200
promulgated under Regulation SHO under the Exchange Act, whether or not against
the box, and all types of direct and indirect stock pledges, forward sale
contracts, options, puts, calls, short sales, swaps, “put equivalent positions”
(as defined in Rule 16a-1(h) under the Exchange Act) and similar arrangements
(including on a total return basis), and sales and other transactions through
non-U.S. broker dealers or foreign regulated brokers.  

(f)Certain Relationships.  The Investor represents that, except as set forth
below, (i) it has had no position, office or other material relationship within
the past three (3) years with the Company or persons known to it to be
affiliates of the Company; (ii) it is not a member of the Financial Industry
Regulatory Authority (formerly known as the National Association of Securities
Dealers) or an Associated Person (as such term is defined under FINRA Membership
and Registration Rules Section 1011) as of the date hereof; and (iii) neither it
nor any group of investors (as identified in a public filing made with the
Commission) of which it is a member, acquired, or obtained the right to acquire,
twenty percent (20%) or more of the Common Stock (or securities convertible or
exercisable for Common Stock) or voting power of the Company on a
post-transaction basis.  

9.Other Covenants.  

(a)Indemnification of Investors.  Subject to the provisions of this Section
9(a), the Company will indemnify and hold each Investor and its directors,
officers, shareholders, members, partners, employees and agents (and any other
Persons (as defined below) with a functionally equivalent role of a Person
holding such titles notwithstanding a lack of such title or any other title),
each Person who controls such Investor (within the meaning of Section 15 of the
Securities Act and Section 20 of the Exchange Act), and the directors, officers,
shareholders, agents, members, partners or employees (and any other Persons with
a functionally equivalent role of a Person holding such titles notwithstanding a
lack of such title or any other title) of such controlling persons (each, an
“Investor Party”) harmless from any and all losses, liabilities, obligations,
claims, contingencies, damages, costs and expenses, including all judgments,
amounts paid in settlements, court costs and

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reasonable attorneys’ fees and costs of investigation that any such Investor
Party may suffer or incur as a result of or relating to (i) any breach of any of
the representations, warranties, covenants or agreements made by the Company in
this Agreement or any document delivered in relation hereto; or (ii) any action
instituted against any Investor Party or any of their Affiliates in any capacity
by any stockholder of the Company with respect to any of the transactions
contemplated by this Agreement (except to the extent resulting from a breach of
such Investor Party’s representations, warranties or covenants under this
Agreement or any violations by such Investor Party of state or federal
securities laws or any other conduct by such Investor Party which constitutes
fraud, gross negligence, willful misconduct or malfeasance).  If any action
shall be brought against any Investor Party in respect of which indemnity may be
sought pursuant to this Agreement, such Investor Party shall promptly notify the
Company in writing, and the Company shall have the right to assume the defense
thereof with counsel of its own choosing reasonably acceptable to the Investor
Party.  Any Investor Party shall have the right to employ separate counsel in
any such action and participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of such Investor Party, except
to the extent that (A) the employment thereof has been specifically authorized
by the Company in writing; (B) the Company has failed after a reasonable period
of time to assume such defense and to employ counsel; or (C) in such action
there is, in the reasonable opinion of such separate counsel, a material
conflict on any material issue between the position of the Company and the
position of such Investor Party, in which case the Company shall be responsible
for the reasonable fees and expenses of no more than one such separate
counsel.  The Company will not be liable to any Investor Party under this
Agreement (y) for any settlement by an Investor Party effected without the
Company’s prior written consent, which shall not be unreasonably withheld or
delayed; or (z) to the extent, but only to the extent, that a loss, claim,
damage or liability is attributable to any Investor Party’s breach of any of the
representations, warranties, covenants or agreements made by such Investor Party
in this Agreement.  The indemnification required by this Section 9(a) shall be
made by periodic payments of the amount thereof during the course of the
investigation or defense or other matter, as and when bills relating to
indemnifiable amounts are received by the Company.  The indemnity agreements
contained herein shall be in addition to any cause of action or similar right of
any Investor Party against the Company or others and any liabilities the Company
may be subject to pursuant to law.  “Person” means an individual or corporation,
partnership, trust, incorporated or unincorporated association, joint venture,
limited liability company, joint stock company, government (or an agency or
subdivision thereof) or other entity of any kind.  “Affiliate” means any Person
that, directly or indirectly through one or more intermediaries, controls or is
controlled by or is under common control with a Person as such terms are used in
and construed under Rule 405 under the Securities Act.

(b)Reservation of Securities.  As of the date hereof, the Company has reserved
and the Company shall continue to reserve and keep available at all times, free
of preemptive rights, a sufficient number of shares of Common Stock for issuance
pursuant to this Agreement in such amount as may then be required to fulfill its
obligations in full under this Agreement.

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(c)Listing of Common Stock.  The Company hereby agrees to use best efforts to
maintain the listing or quotation of the Common Stock on the Nasdaq Global
Market or Nasdaq Capital Market, and concurrently with the Closing, the Company
shall apply to list or quote all of the Shares on the Nasdaq Global Market or
Nasdaq Capital Market and promptly secure the listing of all of the Shares on
the Nasdaq Global Market or Nasdaq Capital Market.  The Company further agrees,
if the Company applies to have the Common Stock traded on any other Trading
Market, it will then include in such application all of the Shares, and will
take such other action as is necessary to cause all of the Shares to be listed
or quoted on such other Trading Market as promptly as possible.  The Company
will then take all action reasonably necessary to continue the listing and
trading of its Common Stock on a Trading Market and will comply in all respects
with the Company’s reporting, filing and other obligations under the bylaws or
rules of the Trading Market.

(d)Equal Treatment of Investors.  No consideration, including any modification
of this Agreement, shall be offered or paid to any Person to amend or consent to
a waiver or modification of any provision of this Agreement unless the same
consideration is offered to all parties to this Agreement.  For clarification
purposes, this provision constitutes a separate right granted to each Investor
by the Company and negotiated separately by each Investor, and is intended for
the Company to treat the Investors as a class and shall not in any way be
construed as the Investors acting in concert or as a group with respect to the
purchase, disposition or voting of Shares or otherwise.

(e)Use of Proceeds. The Company intends to use the net proceeds from the sale of
the Shares hereunder for clinical trial and research and development activity
and other general corporate purposes; provided that the Company hereby agrees
not to use such proceeds from the date hereof until six (6) months after the
Closing Date for the pre-payment of any portion of the Company’s debt, to
declare or pay any dividends on the Common Stock, to fund any share buyback
program or for any in-license or asset purchase outside of the ordinary course
of the Company’s business.

10.Miscellaneous.  

(a)Termination.  This Agreement may be terminated by any Investor, as to such
Investor’s obligations hereunder only and without any effect whatsoever on the
obligations between the Company and the other Investors, by written notice to
the other parties, if the Closing has not been consummated on or before June 24,
2019; provided, however, that no such termination will affect the right of any
party to sue for any breach by any other party or parties.

(b)Fees and Expenses.  Except as expressly set forth in this Agreement to the
contrary, each party shall pay the fees and expenses of its advisers, counsel,
accountants and other experts, if any, and all other expenses incurred by such
party incident to the negotiation, preparation, execution, delivery and
performance of this Agreement; provided, however, that the Company shall pay the
fees and expenses of counsel to Lion Point Master, LP in the amount of
$25,000.  The Company shall pay all Transfer Agent fees (including, without
limitation, any fees required for same-day processing of any instruction letter

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delivered by the Company and any conversion or exercise notice delivered by an
Investor), stamp taxes and other taxes and duties levied in connection with the
delivery of any Shares to the Investors.

(c)Entire Agreement.  This Agreement, together with the exhibits and schedules
hereto, 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.

(d)Notices.  Any and all notices or other communications or deliveries required
or permitted to be provided hereunder shall be in writing and shall be deemed
given and effective on the earliest of (a) the date of transmission, if such
notice or communication is delivered via electronic mail at the e-mail address
set forth on the signature pages attached hereto at or prior to 5:30 p.m. (New
York City time) on a Trading Day and no return receipt or other error is
received by the delivering party; (b) the next Trading Day after the date of
transmission, if such notice or communication is delivered via electronic mail
at the e-mail address set forth on the signature pages attached hereto on a day
that is not a Trading Day or later than 5:30 p.m. (New York City time) on any
Trading Day and no return receipt or other error is received by the delivering
party; (c) the second (2nd) Trading Day following the date of mailing, if sent
by U.S. nationally recognized overnight courier service; or (d) upon actual
receipt by the party to whom such notice is required to be given.  The address
for such notices and communications shall be as set forth on the signature pages
attached hereto.

(e)Amendments; Waivers.  No provision of this Agreement may be waived, modified,
supplemented or amended except in a written instrument signed, in the case of an
amendment, by the Company and the Investors holding at least a majority in
interest of the Shares based on the initial Subscription Amounts hereunder or,
in the case of a waiver, by the party against whom enforcement of any such
waived provision is sought.  No waiver of any default with respect to any
provision, condition or requirement of this Agreement shall be deemed to be a
continuing waiver in the future or a waiver of any subsequent default or a
waiver of any other provision, condition or requirement hereof, nor shall any
delay or omission of any party to exercise any right hereunder in any manner
impair the exercise of any such right.

(f)Headings.  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.

(g)Successors and Assigns.  This Agreement shall be binding upon and inure to
the benefit of the parties and their successors and permitted assigns.  The
Company may not assign this Agreement or any rights or obligations hereunder
without the prior written consent of each Investor.  Any Investor may assign any
or all of its rights under this Agreement to any Person to whom such Investor
assigns or transfers any Shares, provided

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that such transferee agrees in writing to be bound, with respect to the
transferred Shares, by the provisions of this Agreement that apply to the
“Investors.”

(h)No Third-Party Beneficiaries.  This Agreement is intended for the benefit of
the parties hereto and their respective successors and permitted assigns and is
not for the benefit of, nor may any provision hereof be enforced by, any other
Person, except as otherwise set forth in Section 9(a).

(i)Governing Law.  All questions concerning the construction, validity,
enforcement and interpretation of this Agreement shall be governed by and
construed and enforced in accordance with the internal laws of the State of New
York, without regard to the principles of conflicts of law thereof.  Each party
agrees that all legal proceedings concerning the interpretations, enforcement
and defense of the transactions contemplated by this Agreement (whether brought
against a party hereto or its respective affiliates, directors, officers,
shareholders, partners, members, employees or agents) shall be commenced
exclusively in the state and federal courts sitting in the City of New
York.  Each party hereby irrevocably submits to the exclusive jurisdiction of
the state and federal courts sitting in the City of New York, Borough of
Manhattan, for the adjudication of any dispute hereunder or in connection
herewith or with any transaction contemplated hereby or discussed herein
(including with respect to the enforcement of this Agreement), and hereby
irrevocably waives, and agrees not to assert in any suit, action or proceeding,
any claim that it is not personally subject to the jurisdiction of any such
court, that such suit, action or proceeding is improper or is an inconvenient
venue for such proceeding.  Each party hereby irrevocably waives personal
service of process and consents to process being served in any such suit, action
or proceeding by mailing a copy thereof via registered or certified mail or
overnight delivery (with evidence of delivery) to such party at the address in
effect for notices to it under this Agreement and agrees that such service shall
constitute good and sufficient service of process and notice thereof.  Nothing
contained herein shall be deemed to limit in any way any right to serve process
in any other manner permitted by law.  If either party shall commence an action,
suit or proceeding to enforce any provisions of this Agreement, then, in
addition to the obligations of the Company under Section 9(a), the prevailing
party in such action, suit or proceeding shall be reimbursed by the other party
for its reasonable attorneys’ fees and other costs and expenses incurred with
the investigation, preparation and prosecution of such action or proceeding.

(j)Survival.  The representations, warranties and covenants contained herein
shall survive the Closing and the delivery of the Shares.

(k)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 each other party, it being understood that the parties need not
sign the same counterpart.  In the event that any signature is delivered by
facsimile transmission or by e-mail delivery of a “.pdf” format data file, such
signature shall create a valid and binding obligation of the party executing (or
on whose behalf such signature is executed) with the same force and effect as if
such facsimile or “.pdf” signature page were an original thereof.

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(l)Severability.  If any term, provision, covenant or restriction of this
Agreement is held by a court of competent jurisdiction to be invalid, illegal,
void or unenforceable, the remainder of the terms, provisions, covenants and
restrictions set forth herein shall remain in full force and effect and shall in
no way be affected, impaired or invalidated, and the parties hereto shall use
their commercially reasonable efforts to find and employ an alternative means to
achieve the same or substantially the same result as that contemplated by such
term, provision, covenant or restriction.  It is hereby stipulated and declared
to be the intention of the parties that they would have executed the remaining
terms, provisions, covenants and restrictions without including any of such that
may be hereafter declared invalid, illegal, void or unenforceable.

(m)Remedies.  In addition to being entitled to exercise all rights provided
herein or granted by law, including recovery of damages, each Investor and the
Company will be entitled to specific performance under this Agreement.  The
parties agree that monetary damages may not be adequate compensation for any
loss incurred by reason of any breach of obligations contained in this Agreement
and hereby agree to waive and not to assert in any action for specific
performance of any such obligation the defense that a remedy at law would be
adequate.

(n)Payment Set Aside.  To the extent that the Company makes a payment or
payments to any Investor pursuant to this Agreement or an Investor enforces or
exercises its rights thereunder, and such payment or payments or the proceeds of
such enforcement or exercise or any part thereof are subsequently invalidated,
declared to be fraudulent or preferential, set aside, recovered from, disgorged
by or are required to be refunded, repaid or otherwise restored to the Company,
a trustee, receiver or any other Person under any law (including, without
limitation, any bankruptcy law, state or federal law, common law or equitable
cause of action), then to the extent of any such restoration the obligation or
part thereof originally intended to be satisfied shall be revived and continued
in full force and effect as if such payment had not been made or such
enforcement or setoff had not occurred.

(o)Independent Nature of Each Investor’s Obligations and Rights.  The
obligations of each Investor under this Agreement are several and not joint with
the obligations of any other Investor, and no Investor shall be responsible in
any way for the performance or non-performance of the obligations of any other
Investor under this Agreement.  Nothing contained herein or in any other
document related to the transactions contemplated hereunder, and no action taken
by any Investor pursuant hereto or thereto, shall be deemed to constitute the
Investors as a partnership, an association, a joint venture or any other kind of
entity, or create a presumption that the Investor s are in any way acting in
concert or as a group with respect to such obligations or the transactions
contemplated by this Agreement.  Each Investor shall be entitled to
independently protect and enforce its rights including, without limitation, the
rights arising out of this Agreement, and it shall not be necessary for any
other Investor to be joined as an additional party in any proceeding for such
purpose.  Each Investor has been represented by its own separate legal counsel
in its review and negotiation of this Agreement.  King & Spalding LLP only
represents Lion Point Master, LP and does not represent any of other
Investors.  The Company has elected to provide all Investors with the same terms
and purchase agreement for the convenience

21

 

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of the Company and not because it was required or requested to do so by any of
the Investors.  It is expressly understood and agreed that each provision
contained in this Agreement is between the Company and an Investor, solely, and
not between the Company and the Investors collectively and not between and among
the Investors.

(p)Saturdays, Sundays, Holidays, etc.  If the last or appointed day for the
taking of any action or the expiration of any right required or granted herein
shall not be a Trading Day, then such action may be taken or such right may be
exercised on the next succeeding Trading Day.

(q)Construction.  The parties agree that each of them and their respective
counsel have reviewed and had an opportunity to revise this Agreement and,
therefore, the normal rule of construction to the effect that any ambiguities
are to be resolved against the drafting party shall not be employed in the
interpretation of this Agreement or any amendments hereto.  In addition, each
and every reference to share prices and shares of Common Stock in this Agreement
shall be subject to adjustment for reverse and forward stock splits, stock
dividends, stock combinations and other similar transactions of the Common Stock
that occur after the date of this Agreement.

[Remainder of page intentionally left blank]

 

 

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

“COMPANY”

DURECT CORPORATION

 

By:________________________
Name: James E. Brown
Title: President and Chief Executive Officer

 

Address for Notice
10260 Bubb Road

Cupertino, CA 95014

With a copy to (which shall not constitute notice):

Orrick, Herrington & Sutcliffe LLP
Columbia Center

1152 15th Street, N.W.

Washington, D.C. 20005-1706

Attention: Stephen Thau

 

 

 

[Signature Page to Securities Purchase Agreement]

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

Name of Investor: ________________________________________________________

Signature of Authorized Signatory of Investor: _________________________________

Name of Authorized Signatory: _______________________________________________

Title of Authorized Signatory: ________________________________________________

Email Address of Authorized Signatory:_________________________________________

Address for Notice to Investor:  _______________________________________

Subscription Amount: _____________

Shares: ____________

EIN Number: _______________________

The Shares shall be released by the Transfer Agent to the Investor at the
Closing by electronic book-entry at The Depository Trust Company, registered in
the Investor’s name and address as set forth on this signature page of the
Agreement.  

Name of DTC Participant (broker-dealer at which the account or accounts to be
credited with the Shares are maintained)

 

DTC Participant Number

 

Name of Account at DTC Participant being credited with the Shares

 

Account Number at DTC Participant being credited with the Shares

 

 

 

 

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EXHIBIT A

SCHEDULE OF INVESTORS

Investor

 

Number of Shares

 

Aggregate Purchase Price

 

 

 

 

 

 

 

 

 

 

Total

29,000,000

 

$15,080,000.00

 

 

 

 

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ANNEX A

FREEWRITING PROSPECTUSES OF THE COMPANY