WAIVER AGREEMENT

 

This WAIVER AGREEMENT (this “Waiver”), dated as of February 26, 2018, is entered
into by and among INSPIREMD, INC., a Delaware corporation (the “Company”), and
the Purchasers identified on the signature page hereto.

 

WHEREAS, the Company and the Purchasers have previously entered into that
certain Securities Purchase Agreement, dated as of November 28, 2017 (the
“Original Securities Purchase Agreement”);

 

WHEREASE, the Company and the Purchasers have previously entered into that
certain Amendment to Securities Purchase Agreement (together with the Original
Securities Purchase Agreement, the “Securities Purchase Agreement”), dated as
February 21, 2018, whereby the Company and the Purchasers amended certain
provisions of the Original Securities Purchase Agreement;

 

WHEREAS, the Company has informed the Purchasers that the Company intends to
conduct a Subsequent Financing consisting solely of shares of Common Stock or
units consisting of Common Stock and Common Stock purchase warrants (“Subsequent
Financing Warrants”), which shall be publicly registered on Form S-3
(“Registration Statement”) for gross proceeds to the Company of up to
$7,000,000, to be consummated by not later than March 9, 2018 (the “Offering”);

 

WHEREAS, due to certain regulatory constraints, the Company is seeking a
one-time waiver from compliance with Section 4.16 of the Securities Purchase
Agreement with respect to the Offering;

 

WHEREAS, any provision of the Securities Purchase Agreement may be amended or
waived upon the written consent of the Company and the Purchasers holding at
least 67% in interest of the Preferred Stock then outstanding;

 

WHEREAS, the Purchasers executing the signature page hereto hold at least 67% in
interest of the Preferred Stock outstanding as of the date hereof; and

 

WHEREAS, capitalized terms used herein but not otherwise defined shall have the
meanings ascribed to them in the Securities Purchase Agreement.

 

NOW THEREFORE, for good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, the parties agree as follows:

 

1. Series D Redemption. The parties hereto agree, notwithstanding the provisions
of Section 4.22(a) of the Securities Purchase Agreement, solely with respect to
the Offering, the Company shall redeem shares of the Preferred Stock pursuant to
the terms of such Section 4.22(a) mutatis mutandis in lieu of shares of Series C
Preferred Stock.

 

2. One-Time Waiver of Section 4.16. The Purchasers hereby grant to the Company a
one-time waiver from compliance with the provisions of Section 4.16 of the
Securities Purchase Agreement solely with respect to the Offering.
Notwithstanding anything herein to the contrary, the foregoing waiver shall be
limited precisely as written to permit the Company to conduct the Offering
without violating the provisions of Section 4.16 of the Securities Purchase
Agreement and nothing herein shall be deemed a continuing waiver of Section 4.16
of the Securities Purchase Agreement.

 

 

 

 

3. Reduction of Series D Conversion Price. On or prior to the date hereof,
pursuant to Section 7(d) of the Certificate of Designations, the Company’s Board
of Directors adopted a resolution to permanently reduce, subject to the
consummation of the Offering, the Conversion Price of the Preferred Stock to the
Base Conversion Price (as defined herein). The Company shall not rescind, amend
or modify such resolution after the date hereof. The Purchasers hereby grant a
one-time waiver of the 20 day prior notice requirement set forth in Section 7(d)
of the Certificate of Designations with respect to the foregoing reduction in
the Conversion Price. For purposes hereof, “Base Conversion Price” means, to the
extent lower than the Conversion Price, the lowest effective price per share at
which shares of the Company’s Common Stock (or exercise price, if lower, of any
Subsequent Financing Warrants, if any) are sold in the Offering (not taking into
account the value of any Subsequent Financing Warrants that may be issued as
part of a unit with such Common Stock).

 

4. Issuance to Purchasers of Common Stock Equivalents. In the event that the
Company issues any Subsequent Financing Warrants in the Offering as part of a
unit consisting of Common Stock and such Subsequent Financing Warrants, then
each Purchaser shall receive, solely with respect to its Preferred Stock
outstanding immediately prior to the redemption required pursuant to Section 3
(and, for the avoidance of doubt, not with respect to any of its Series C
Preferred Stock), the same number of Subsequent Financing Warrants as
participants in the offering as if such Purchaser’s Subscription Amount was its
subscription amount in the Offering. The Purchasers acknowledge that any
Subsequent Financing Warrants received pursuant to this Section 4 shall not be
registered for sale on the Registration Statement and accordingly shall have
customary Securities Act restrictions on resale.

 

5. Registration Right.

 

(a) On or prior to the date that is 7 days after the Closing of the Offering,
the Company shall use best efforts to prepare and file with the SEC a
registration statement on Form S-3 (or such other form if, at such time, the
Company is not eligible to utilize such Form S-3) (the “Resale Registration
Statement” including the base prospectus contained therein the “Prospectus”)
covering the resale of all of the Conversion Shares and any shares issuable upon
exercise of the Subsequent Financing Warrant (if any) referred to in Section 4
(the “Registrable Securities”).

 

(b) Upon filing the Resale Registration Statement, the Company shall use its
best efforts to cause such Resale Registration Statement to be declared
effective by the SEC as soon as practicable thereafter, including the filing of
amendments and post-effective amendments and supplements to such Resale
Registration Statement. The Company shall otherwise use its reasonable best
efforts to comply with all rules and regulations of the SEC and other
governmental and regulatory authorities applicable to the registration of such
Registrable Securities and the effectiveness of the Resale Registration
Statement.

 

(c) The Company shall maintain such Resale Registration Statement and shall
comply with its other obligations under this Section 4 until such time as the
Registrable Securities may be resold by the Purchasers pursuant to Rule 144 of
the Securities Act without the requirement for the Company to be in compliance
with the current public information required under such Rule and without volume
or manner-of-sale restrictions.

 

(d) The Company shall notify the Purchasers of the occurrence or existence of
any pending corporate development with respect to the Company that it believes
is material and that, in the determination of the Company and its counsel,
causes the Resale Registration Statement and the Prospectus to contain an untrue
statement of material fact or to omit to state a material fact necessary to make
the statements contained therein not misleading, or otherwise makes the Resale
Registration Statement and the Prospectus not in the best interest of the
Company to allow continued availability thereof. The Company shall use its
reasonable best efforts to cause the filing of amendments and post-effective
amendments and supplements to such Resale Registration Statement and Prospectus
as the Company determines are necessary to again allow resales under the Resale
Registration Statement as soon as practicable.

 

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(e) All expenses incident to the Company’s compliance with this Section 5,
including, without limitation, all registration and filing fees, fees and
expenses of compliance with securities laws, printing expenses, filing expenses,
and fees and disbursements of the Company’s counsel and independent registered
public accountants will be borne by the Company.

 

6. Continuing Effect. Except as expressly set forth herein, all of the terms and
conditions of the Securities Purchase Agreement shall remain in full force and
effect and are hereby ratified and confirmed by the parties. Without limiting
the generality of the foregoing, nothing contained herein shall be deemed a
waiver of any other provision of the Securities Purchase Agreement or as a
waiver of or consent to any further or future action on the part of any party
that would require the waiver or consent of another party. This Waiver shall be
deemed a Transaction Document.

 

7. Representations and Warranties. Each Purchaser hereby represents and warrants
to the Company, severally, but not jointly, and each Company hereby represents
and warrants to the Purchaser, that (i) it has the full right, power and
authority to enter into this Waiver and to perform its obligations hereunder and
under the Securities Purchase Agreement as amended by this Waiver, and (ii) the
execution of this Waiver by the individual whose signature is set forth at the
end of this Waiver on behalf of such party, and the delivery of this Waiver by
such party, have been duly authorized by all necessary action on the part of
such party; and (iii) this Waiver has been executed and delivered by such party
and constitutes the legal, valid and binding obligation of such party,
enforceable against such party in accordance with its terms, except as may be
limited by any applicable bankruptcy, insolvency, reorganization, moratorium, or
similar laws and equitable principles related to or affecting creditors’ rights
generally or the effect of general principles of equity.

 

8. Counterparts; Choice of Law. This Waiver may be executed in several identical
counterparts all of which shall constitute one and the same instrument. This
Waiver shall be construed and enforced in accordance with the laws of the State
of New York, without regard to the principles of conflicts of law thereof.

 

9. Further Assurances. Each of the parties hereto shall execute and deliver, at
the reasonable request of the other party hereto, such additional documents,
instruments, conveyances and assurances and take such further actions as such
other party may reasonably request to carry out the provisions hereof and give
effect to the transactions contemplated by this Waiver.

 

10. Expense Reimbursement. The Company shall reimburse to the Purchasers the
fees of Ellenoff Grossman & Schole LLP, counsel to the Purchasers, in the amount
of $5,000.

 

11. Clarification regarding Amendment to Securities Purchase Agreement. The
parties acknowledge and agree that the provisions regarding the Series C
Preferred Stock in the Amendment to the Securities Purchase Agreement (as
modified by Section 1 of this Waiver) are applicable to all Series C Preferred
Stock held by the Purchasers and their Affiliates, whether or not purchasers of
the Preferred Stock.

 

[signature page follows]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Waiver to be duly
executed as of the day and year written above.

 

THE COMPANY:

 

PURCHASER:

         

INSPIREMD, INC.

 

Sabby Healthcare Master Fund, Ltd.

          By: /s/ James Barry, Ph.D.   By: /s/ Robert Grundstein Name:

James Barry, Ph.D.

  Name: Robert Grundstein Title: Chief Executive Officer   Title: COO of
Investment Manager