Exhibit 10.1

 

Execution Copy

 

STEADYMED LTD.

 

SUBSCRIPTION AGREEMENT

 

Restricted Ordinary Shares
and Warrants to purchase Restricted Ordinary Shares

 

STEADYMED LTD., an Israeli incorporated company (the “Company”), is offering for
sale an aggregate of up to $32,000,000 of (i) its restricted ordinary shares
(the “Shares”), and (ii) warrants (the “Warrants”), in the form attached hereto
as Exhibit A, to purchase a number of restricted ordinary shares of the Company
equal to 100 percent of the total number of Shares sold in the Initial Closing
(as defined below) (the “Warrant Shares”), to persons who qualify as “accredited
investors,” as such term is defined in Rule 501(a) of Regulation D of the
Securities Act of 1933, as amended (the “Securities Act”), at the applicable
Price (as defined below) per Share and, if applicable, associated Warrant (the
“Offering”). The undersigned (individually and/or collectively, the
“Participant”) hereby applies to purchase Shares and Warrants in accordance with
the terms and conditions of this Subscription Agreement (the “Agreement”). The
Shares and Warrants together shall hereafter be referred to as the “Securities.”

 

AGREEMENT

 

In consideration of the mutual covenants contained in this Agreement and for
other good and valuable consideration, the receipt of which is hereby
acknowledged, the Company and each Participant (severally and not jointly)
hereby agree as follows:

 

SECTION 1.        AUTHORIZATION OF SALE OF THE SECURITIES. Subject to the terms
and conditions of this Agreement, the Company has or before the Initial Closing
will have authorized the sale and issuance of up to $32,000,000 of (i) ordinary
shares of the Company, nominal value NIS $0.01 per share and (ii) warrants to
purchase a number of ordinary shares of the Company equal to the number of
Shares purchased in the Initial Closing hereunder, at an exercise price per
share equal to 115% of the Initial Price (as defined below). Such Warrants shall
be issued in substantially the form attached hereto as Exhibit A.

 

SECTION 2.        AGREEMENT TO SELL AND PURCHASE THE SECURITIES. The Company
shall issue and sell to each Participant, severally and not jointly, and each
Participant shall purchase from the Company, severally and not jointly, (1) in
the Initial Closing, the number of Shares and a Warrant, both as set forth on
such Participant’s signature page attached at the end of this Agreement (the
“Signature Page”), at a purchase price of $3.13 per Share (the “Initial Price”)
and $0.125 per Warrant Share and (2) in the Second Closing (as defined below),
the number of Shares equal to the excess of the Total Subscription Amount (set
forth on the Signature Page) over the Aggregate Purchase Price in the Initial
Closing (set forth on the Signature Page), divided by the higher of (i) the
Initial Price or (ii) the average closing price of the Company’s ordinary shares
on the NASDAQ Market (as defined below) over the 30 trading days immediately
preceding the Milestone Date (as defined below) (the “Second Price,” and with
the Initial Price, each a “Price”) rounded down to the nearest whole number, at
a purchase price per Share equal to the Second Price (for each Closing, subject
to proportionate adjustment upon the occurrence of any stock split, stock
dividend, reverse stock split or like event that is consummated or becomes
effective during the period commencing on the date hereof and ending

 

1

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

 

immediately prior to each Closing). Subject to each Participant’s termination
right pursuant to Section 8, the purchase of Shares and Warrants hereunder (the
“Subscription”) shall be irrevocable by the Participant, not transferable or
assignable by the Participant and may be rejected in whole or in part by the
Company in its sole discretion. In the event the Subscription is rejected by the
Company or this Agreement is terminated in accordance with its terms, all funds
and documents tendered by the Participant shall be returned to such Participant
and terminated, as applicable.

 

SECTION 3.        CLOSING AND DELIVERY

 

3.1          Closing. The first tranche of this Offering is scheduled to close
(the “Initial Closing”) August 3, 2016 at 10:00 A.M. Pacific Time. The target
Offering is for up to $32,000,000 of Securities, provided that the proceeds from
the Initial Closing shall not be less than $21,333,000.

 

3.2          Delivery of the Shares and Warrants. At each Closing, the Company
will (i) issue to its transfer agent an instruction letter instructing the
transfer agent to record in book entry form, or upon request deliver a share
certificate evidencing, the Shares purchased hereunder to the Participant within
three days of such instruction and (ii) with respect only to the Initial
Closing, issue and deliver a Warrant exercisable for the number of restricted
ordinary shares of the Company specified on the signature page hereof, against
payment of the purchase price therefor by check or wire transfer. The Company
shall also deliver an executed copy of this Agreement to each Participant.

 

3.3          Subsequent Closing. At any time during 14 days following the
Milestone Date, the Company may at its election, trigger a second closing by
notifying each Participant of the achievement of the Milestones (as defined
below) (the “Call Notice”), in which event, the second closing with each
Purchaser shall take place within ten (10) business days following the date the
Call Notice was sent by the Company to the Participants (the “Second Closing,”
and together with the Initial Closing, the “Closings” and individually, a
“Closing”). The Company’s right to trigger the Second Closing will terminate if
the Call Notice is not sent by September 30, 2017. Subscriptions in each Closing
shall be made on the terms and conditions set forth in this Agreement, and (i)
the representations and warranties of the Company set forth in Section 4 hereof
shall speak as of the Initial Closing and the Company shall have no obligation
to update any such disclosure, and (ii) the representations and warranties of
the Participants in Section 5 hereof shall speak as of each Closing. The
“Milestone Date” shall be later of: (i) the date that the Company’s New Drug
Application for Trevyent is accepted by the U.S. Food and Drug Administration
and (ii) the date the Patent Trial and Appeal Board issues a final written
decision invalidating the challenged claims related and relevant to Trevyent,
under the Company’s Inter Partes Review under case number IPR2016-00006
(together the “Milestones”). For greater clarity, the Company shall have no
obligation to deliver the Call Notice and trigger the Second Closing even if the
Milestones occurs.

 

SECTION 4.        REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE COMPANY.

 

Subject to and except as set forth on the Schedule of Exceptions which is
arranged in sections corresponding to the sub-section numbered provisions
contained below in this Section and except as described in the SEC Reports (as
defined below), the Company hereby represents and warrants to, and covenants
with, the Participants as of the date of the Initial Closing and the Second
Closing as follows:

 

2

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

 

4.1          Organization and Qualification. The Company is an Israeli
incorporated company duly organized, validly existing and in good standing under
the laws of Israel and has all requisite corporate power and authority and all
licenses, permits and authorizations to conduct its business as it is currently
being conducted and as it is presently proposed to be conducted and to own,
lease and operate its properties. A true and complete copy of the Tenth Amended
and Restated Articles of Association of the Company (the “Articles”), as amended
to and as in effect on the date hereof, has been filed with the SEC as Exhibit
3.2 to the Company’s Registration Statement on Form S-1 (File No. 333-201949) on
March 9, 2015. The Company is duly qualified and is authorized to transact
business and is in good standing as a foreign corporation in each jurisdiction
in which the failure so to qualify would have a Material Adverse Effect. As used
in this Agreement, a “Material Adverse Effect” means (a) a material adverse
effect upon the business, operations, properties, assets or condition (financial
or otherwise) of the Company or, as the case may be, the Company and any of its
subsidiaries, taken as a whole, (b) the impairment of the ability of the Company
to perform its obligations under this Agreement or (c) a material adverse effect
on the legality, validity or enforceability of this Agreement, provided,
however, that for purposes of determining whether there shall have been any such
“Material Adverse Effect”, (i) any adverse change resulting from or relating to
worldwide general business or economic conditions shall be disregarded, (ii) any
adverse change resulting from or relating to conditions generally affecting the
industry in which the Company competes shall be disregarded, and (iii) any
adverse change to the stock price of the Company’s ordinary shares, as quoted on
any nationally recognized stock quotation system, shall be disregarded, but, in
the case of (i), (ii) and (iii), only to the extent that such changes do not
have a disproportionate impact on the Company relative to other companies in its
industry.

 

4.2          Due Execution, Delivery and Performance. Assuming and relying on
the accuracy of the representation set forth in Section 5, the Company’s
execution, delivery and performance of this Agreement and the issuance and sale
of the Shares and Warrants have been duly authorized by all requisite corporate
and shareholder action by the Company and its shareholders, respectively. Upon
the execution and delivery by the Company, and assuming the valid execution and
delivery of this Agreement by each of the Participants, this Agreement will
constitute the valid and binding obligation of the Company, enforceable 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),
including specific performance, and except as the indemnification provisions
contained in Section 9.4 hereof may be legally unenforceable.

 

4.3          No Conflicts. The Company’s execution, delivery and performance of
this Agreement and the issuance of the Shares and Warrants will not violate,
conflict with, result in a breach of or constitute (upon notice or lapse of time
or both) a default under, or result in the creation or imposition of any lien,
security interest, mortgage, pledge, charge or other encumbrance upon any
properties or assets of the Company under any (a) law, regulation, rule,
injunction, judgment, order, decree, ruling, charge or other restriction of any
government, governmental agency, court or arbitrator to which the Company is
subject, (b) the Company’s Articles bylaws or other organizational documents or
(c) any provision of any indenture, mortgage, agreement, contract or other
instrument to which the Company is a party or by which the Company or any of its
properties or assets is bound as of the date hereof, except in the case

 

3

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

 

of each of clauses (a) and (c), such as could not have or reasonably be expected
to result in a Material Adverse Effect.

 

4.4          Governmental Consents. Except for applicable filings with The
NASDAQ Stock Market LLC (the “Nasdaq Market”), under the Securities Act or the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), no consent,
approval, qualification, order or authorization of, or filing with, any local,
state, or federal governmental authority is required on the part of the Company
in connection with the Company’s valid execution, delivery, or performance of
this Agreement, or the offer, sale or issuance of the Shares and Warrants by the
Company, other than any post-closing filings as may be required under applicable
federal, state or Israeli securities laws, which will be timely filed within the
applicable periods therefor.

 

4.5          Issuance and Subscription of the Securities. When issued and paid
for in accordance with this Agreement, the Shares and Warrants to be subscribed
for hereunder by the Participants and, upon exercise of the Warrants in
accordance with their terms, the Warrant Shares will be validly issued and
outstanding, fully paid and non-assessable. The Company has reserved from its
duly authorized capital stock the maximum number of shares for issuance of all
Shares and all shares underlying the Warrants.

 

4.6          SEC Reports.

 

(a)           Since March 19, 2015, the Company has filed in a timely manner
with the Securities and Exchange Commission (the “SEC”) all reports (“SEC
Reports”) required to be filed by it under the Exchange Act. All of the SEC
Reports filed by the Company comply in all material respects with the
requirements of the Exchange Act. None of the SEC Reports contains, as of the
respective dates thereof, any untrue statement of a material fact or omits to
state any material fact required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances under which they
were made. All financial statements contained in the SEC Reports (i) comply in
all material respects with applicable accounting requirements and the rules and
regulations of the SEC with respect thereto as in effect at the time of filing
and (ii) have been prepared in accordance with generally accepted accounting
principles consistently applied throughout the period indicated (“GAAP”). Each
balance sheet is in accordance with the books and records of the Company and
presents fairly in accordance with GAAP the financial position of the Company as
of the date of such balance sheet, and each statement of operations, of
shareholders’ equity and of cash flows is in accordance with the books and
records of the Company and presents fairly in accordance with GAAP the results
of operations, the shareholders’ equity and the cash flows of the Company for
the periods then ended. The Company has never been an issuer subject to Rule
144(i) under the Securities Act.

 

(b)           No event has occurred since March 31, 2016, requiring the filing
of an SEC Report that has not heretofore been filed and furnished to the
Participants (including, without limitation, any amendment to any such SEC
Report).

 

4.7          No Material Change. Since the date of the latest audited financial
statements included within the SEC Reports, and except as otherwise reported in
the SEC Reports, (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 disclosed in filings made

 

4

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

 

with the SEC, (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, except
pursuant to existing Company stock option plans. Except as may be set forth in
the SEC Reports, the Company does not have pending before the SEC any request
for confidential treatment of information. Except for the issuance of the
Securities 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 business,
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 on or
prior to the date that this representation is made.

 

4.8          Executive Officers. As of the date hereof, and since the date of
the most recent SEC Report, there have been no resignations, terminations or
appointments with respect to (a) the Board of Directors of the Company or (b)
the executive officers of the Company.

 

4.9          Capitalization. The authorized share capital of the Company
consists of 50,000,000 shares of ordinary shares, nominal value NIS $0.01 per
share, of which 13,585,810 such shares were issued and outstanding as of July
28, 2016. Except as contemplated by this Agreement and except for shares
reserved under the Company’s Amended and Restated 2009 Stock Incentive Plan,
2013 Stock Incentive Subplan and Warrant to purchase 10,191 ordinary shares, as
of July 28, 2016, there are no existing options, warrants, calls, preemptive (or
similar) rights, subscriptions or other rights, agreements, arrangements or
commitments of any character obligating the Company to issue, transfer or sell,
or cause to be issued, transferred or sold, any shares of share capital of the
Company or other equity interests in the Company or any securities convertible
into or exchangeable for such shares of share capital or other equity interests,
and there are no outstanding contractual obligations of the Company to
repurchase, redeem or otherwise acquire, or prepare and file with the SEC any
registration statement to register under the Securities Act with respect to, any
such shares of share capital or other equity interests. There exist no statutory
preemptive, or other similar rights to purchase securities of the Company.

 

4.10        Nasdaq Compliance. The Company’s ordinary shares are registered
pursuant to Section 12(b) of the Exchange Act and is listed on the NASDAQ Global
Market (“Nasdaq Stock Market”), and the Company has taken no action designed to,
or which to its knowledge is likely to have the effect of, terminating the
registration of its ordinary shares under the Exchange Act or delisting its
ordinary shares from the Nasdaq Stock Market.

 

4.11        Litigation. There is no action, suit, inquiry, notice of violation,
proceeding or investigation pending or, to the knowledge of the Company,
threatened against or affecting the Company or any of its properties before or
by any court, arbitrator, governmental or administrative agency or regulatory
authority (federal, state, county, local or foreign) (collectively, an “Action”)
which (i) adversely affects or challenges the legality, validity or
enforceability of this Agreement or the Securities or (ii) would, if there were
an unfavorable decision, have or reasonably be expected to result in a Material
Adverse Effect. Neither the Company nor any director or officer thereof, is or
has been the subject of any Action involving a claim of violation of or
liability under federal or state securities laws or a claim of breach of
fiduciary duty. There has not been, and to the knowledge of the Company, there
is not pending or contemplated, any investigation by the SEC involving the
Company or any current or former director or officer of the Company. The SEC has
not issued any stop order or other order

 

5

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

 

suspending the effectiveness of any registration statement filed by the Company
under the Exchange Act or the Securities Act.

 

4.12        Compliance. The Company: (i) is not 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), 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) is not in
violation of any judgment, decree or order of any court, arbitrator or other
governmental authority and (iii) is not or has not been 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 have
or reasonably be expected to result in a Material Adverse Effect.

 

4.13        Intellectual Property. The Company has, or has rights to use, all
(i) all inventions (whether patentable or unpatentable, and whether or not
reduced to practice), all improvements thereto, and all patents, patent
applications, and patent disclosures, together with all reissuances,
continuations, continuations-in-part, revisions, extensions, and reexaminations
thereof, (ii) all trademarks, service marks, trade dress, logos, trade names and
corporate names, together with all translations, adaptations, derivations and
combinations thereof and including all goodwill associated therewith, and all
applications, registrations and renewals in connection therewith, (iii) all
copyrightable works, all copyrights, all applications, registrations and
renewals in connection therewith, (iv) all trade secrets and confidential
business information (including, without limitation, ideas, research and
development, know-how, formulas, compositions, manufacturing and production
processes and techniques, technical data, designs, drawings, specifications,
supplier lists, and business and marketing plans and proposals), (v) all gene
sequences, cell lines, chemical compounds, assays and biological materials, (vi)
all other proprietary rights and (vii) all copies and tangible embodiments of
any of the foregoing (in whatever form or medium) and other intellectual
property rights and similar rights necessary or required for use in connection
with its business as described in the SEC Reports and which the failure to so
have would reasonably be expected to have a Material Adverse Effect
(collectively, the “Intellectual Property Rights”). The Company has not received
a 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 two (2) years from the date of this Agreement except as
would not reasonably be expected to have a Material Adverse Effect. The Company
has not received, since the date of the latest audited financial statements
included within the SEC Reports, a written notice of a claim or otherwise has
any knowledge that the Intellectual Property Rights violate or infringe upon the
rights of any person, except as would not have or reasonably be expected to not
have a Material Adverse Effect. To the 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. The
Company has taken reasonable security measures to protect the secrecy,
confidentiality and value of all of their intellectual properties, except where
failure to do so would not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect.

 

4.14        Transactions With Affiliates and Employees. Except as set forth in
the SEC Reports, none of the officers or directors of the Company and, to the
knowledge of the Company,

 

6

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

 

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, stockholder, member or partner, in each case in
excess of $120,000 other than for (i) payment of salary or consulting fees for
services rendered, (ii) reimbursement for expenses incurred on behalf of the
Company and (iii) other employee benefits, including stock option agreements
under any stock or equity incentive plan of the Company.

 

4.15        Internal Accounting Controls. The Company has implemented internal
controls, which, at a minimum, are adequate to provide reasonable assurances
that: (A) transactions are executed in accordance with management’s general or
specific authorization; (B) transactions are recorded as necessary to: (i)
permit preparation of financial statements in conformity with generally accepted
accounting principles or any other criteria applicable to such statements and
(ii) maintain accountability for assets; (C) access to assets is permitted only
in accordance with management’s general or specific authorization; and (D) 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 is not being, and have not been, investigated by any
governmental authority with respect to, or been given notice by a governmental
authority of, any potential violation by the Company of any law concerning
corrupting payments.

 

4.16        Registration Rights. No person has any right to cause the Company to
effect the registration under the Securities Act of any securities of the
Company, except as listed on Schedule 1 hereto.

 

4.17        Application of Takeover Protections. The Company and the Board of
Directors have taken all necessary action, if any, in order to render
inapplicable any control share acquisition, business combination, poison pill
(including any distribution under a rights agreement) or other similar anti
takeover provision under the Company’s certificate of incorporation (or similar
charter documents) or the laws of its state of incorporation that is or could
become applicable to the Participants as a result of the Participants and the
Company fulfilling their obligations or exercising their rights under this
Agreement, including without limitation as a result of the Company’s issuance of
the Securities and the Participants’ ownership of the Securities.

 

4.18        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 the
Participants 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 Participants will rely on the foregoing
representation in effecting transactions in securities of the Company. All of
the disclosure furnished by or on behalf of the Company to the Participants
regarding the Company, its business and the transactions contemplated hereby, is
true and correct in all material respects as of the date made 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. The SEC Reports
disseminated by the Company during the twelve months preceding the date of this
Agreement taken as a whole do

 

7

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

 

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 light of the circumstances under which they were made and when made,
not misleading. The Company acknowledges and agrees that no Participants makes
or has made any representations or warranties with respect to the transactions
contemplated hereby other than those specifically set forth in Section 5 hereof.

 

4.19        No Integrated Offering. Assuming the accuracy of the Participants’
representations and warranties set forth in Section 5, neither the Company, nor
any of its affiliates, nor any person acting on its or 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 cause this
offering of the Securities to be integrated with prior offerings by the Company
for purposes of (i) the Securities Act which would require the registration of
any securities under the Securities Act, or (ii) any applicable shareholder
approval provisions of any trading market on which any of the securities of the
Company are listed or designated.

 

4.20        Tax Status/CFC/PFIC. All taxes (whether or not shown on any tax
return) for which the Company may be liable have been timely paid, and all tax
returns required to have been filed by or with respect to the Company have been
timely filed, unless failure to so pay or file would not have a Material Adverse
Effect. The Company is treated as a corporation for federal income tax purposes.
As of December 2015, the Company was not a “controlled foreign corporation” or
“CFC” (as defined in Section 957 of the Internal Revenue Code of 1986, as
amended (the “Code”)), and was not a “passive foreign investment company” or
“PFIC” (as defined in section 1297 of the Code).

 

4.21        Foreign Corrupt Practices. The Company has complied in all material
respects with laws concerning bribery, corruption, kickbacks or other similar
payments or transfers of value to or from another person to obtain or retain
business or secure an improper advantage. Neither the Company nor any of the
Company’s directors, officers, employees or agents have, directly or indirectly,
made, offered, promised or authorized any payment or gift of any money or
anything of value to or for the benefit of any “foreign official” (as such term
is defined in the U.S. Foreign Corrupt Practices Act of 1977, as amended (the
“FCPA”)), foreign political party or official thereof or candidate for foreign
political office for the purpose of (i) influencing any official act or decision
of such official, party or candidate, (ii) inducing such official, party or
candidate to use his, her or its influence to affect any act or decision of a
foreign governmental authority, or (iii) securing any improper advantage, in the
case of (i), (ii) and (iii) above, in order to assist the Company or any of its
affiliates in obtaining or retaining business for or with, or directing business
to, any person. Neither the Company nor any of its directors, officers,
employees or agents have made or authorized any bribe, rebate, payoff, influence
payment, kickback or other unlawful payment of funds or received or retained any
funds in violation of any law, rule or regulation. The Company further
represents that it has maintained, and has caused each of its subsidiaries and
affiliates to maintain, systems of internal controls (including, but not limited
to, accounting systems, purchasing systems and billing systems) to ensure
compliance with the FCPA or any other applicable anti-bribery or anti-corruption
law. Neither the Company, or, to the Company’s knowledge, any of its officers,
directors or employees are the subject of any allegation, voluntary disclosure,
investigation, prosecution or other enforcement action related to the FCPA or
any other applicable foreign or domestic anti-corruption law (collectively,
“Enforcement Action”). No directors, officers, employees, agents, or
representatives of the Company has been an official of any governmental
authority or of any

 

8

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

 

agency thereof, an official of a political party, or a candidate for political
office. No contributions have been made by the Company, directly or indirectly,
to a political party or candidate.

 

4.22        Acknowledgment Regarding Participants’ Purchase of Securities. The
Company acknowledges and agrees that each of the Participants is acting solely
in the capacity of an arm’s length Participant with respect to this Agreement
and the transactions contemplated hereby. The Company further acknowledges that
no Participant 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 Participant or any of their
respective representatives or agents in connection with this Agreement and the
transactions contemplated hereby is merely incidental to the Participants’
purchase of the Securities. The Company further represents to each Participant
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.

 

4.23        Acknowledgement Regarding Participant’s Trading Activity. Anything
in this Agreement or elsewhere herein to the contrary notwithstanding, it is
understood and acknowledged by the Company that: (i) none of the Participants
has been asked by the Company to agree, nor has any Participant agreed, to
desist from purchasing or selling, long and/or short, securities of the Company,
or “derivative” securities based on securities issued by the Company or to hold
the Securities for any specified term; (ii) past or future open market or other
transactions by any Participant, specifically including, without limitation,
Short Sales or “derivative” transactions, before or after the closing of this or
future private placement transactions, may negatively impact the market price of
the Company’s publicly-traded securities; (iii) any Participant, and
counter-parties in “derivative” transactions to which any such Participant is a
party, directly or indirectly, presently may have a “short” position in the
Shares, and (iv) each Participant shall not be deemed to have any affiliation
with or control over any arm’s length counter-party in any “derivative”
transaction. The Company further understands and acknowledges that (y) one or
more Participants may engage in hedging activities at various times during the
period that the Securities are outstanding, including, without limitation,
during the periods that the value of the shares underlying the Warrants
deliverable with respect to Securities are being determined, and (z) such
hedging activities (if any) could reduce the value of the existing stockholders’
equity interests in the Company at and after the time that the hedging
activities are being conducted. The Company acknowledges that such
aforementioned hedging activities do not constitute a breach of this Agreement.

 

4.24        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
Securities, (ii) sold, bid for, purchased, or, paid any compensation for
soliciting purchases of, any of the Securities, or (iii) paid or agreed to pay
to any person any compensation for soliciting another to purchase any other
securities of the Company, other than, in the case of clauses (ii) and (iii),
compensation paid to the Placement Agent in connection with the placement of the
Securities.

 

4.25        FDA. As to each product subject to the jurisdiction of the U.S. Food
and Drug Administration (“FDA”) under the Federal Food, Drug and Cosmetic Act,
as amended, and the regulations thereunder (“FDCA”) that is manufactured,
packaged, labeled, tested, distributed, sold, and/or marketed by the Company
(each such product, a “Pharmaceutical Product”), such Pharmaceutical Product is
being manufactured, packaged, labeled, tested, distributed, sold and/or

 

9

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

 

marketed by the Company in compliance with all applicable requirements under
FDCA and similar laws, rules and regulations relating to registration,
investigational use, premarket clearance, licensure, or application approval,
good manufacturing practices, good laboratory practices, good clinical
practices, product listing, quotas, labeling, advertising, record keeping and
filing of reports, except where the failure to be in compliance would not
reasonably be expected to have a Material Adverse Effect. Except as disclosed in
the SEC Reports, there is no pending, completed or, to the Company’s knowledge,
threatened, action (including any lawsuit, arbitration, or legal or
administrative or regulatory proceeding, charge, complaint, or investigation)
against the Company, and the Company has not received any notice, warning letter
or other communication from the FDA or any other governmental entity, which (i)
contests the premarket clearance, licensure, registration, or approval of, the
uses of, the distribution of, the manufacturing or packaging of, the testing of,
the sale of, or the labeling and promotion of any Pharmaceutical Product, (ii)
withdraws its approval of, requests the recall, suspension, or seizure of, or
withdraws or orders the withdrawal of advertising or sales promotional materials
relating to, any Pharmaceutical Product, (iii) imposes a clinical hold on any
clinical investigation by the Company, (iv) enjoins production at any facility
of the Company, (v) enters or proposes to enter into a consent decree of
permanent injunction with the Company, or (vi) otherwise alleges any violation
of any laws, rules or regulations by the Company, and which, either individually
or in the aggregate, would have a Material Adverse Effect. The properties,
business and operations of the Company have been and are being conducted in all
material respects in accordance with all applicable laws, rules and regulations
of the FDA. The Company has not been informed by the FDA that the FDA will
prohibit the marketing, sale, license or use in the United States of any product
proposed to be developed, produced or marketed by the Company nor, to the
knowledge of the company, has the FDA expressed in any meeting or written
communication with the Company any concern as to approving or clearing for
marketing any product being developed or proposed to be developed by the
Company.

 

4.26        Office of foreign assets control. neither 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”).

 

4.27        U.S. Real Property Holding Corporation. The Company is not and has
never been a U.S. real property holding corporation within the meaning of
Section 897 of the Internal Revenue Code of 1986, as amended, and the Company
shall so certify upon Participant’s request.

 

4.28        Money Laundering. The operations of the Company are and have been
conducted at all times in compliance with applicable financial record-keeping
and reporting requirements of the Currency and Foreign Transactions Reporting
Act of 1970, as amended, applicable money laundering statutes and applicable
rules and regulations thereunder (collectively, the “Money Laundering Laws”),
and no Action, suit or proceeding by or before any court or governmental agency,
authority or body or any arbitrator involving the Company with respect to the
Money Laundering Laws is pending or, to the knowledge of the Company,
threatened.

 

4.29        No General Solicitation. Neither the Company nor any person acting
on behalf of the Company has offered or sold any of the Securities by any form
of general solicitation or general advertising. The Company has offered the
Securities only to the Participants and certain other “accredited investors”
within the meaning of Rule 501 under the Securities Act.

 

10

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

 

4.30        No Disqualification Events. With respect to the Securities to be
offered and sold hereunder in reliance on Rule 506 under the Securities Act,
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, or, to the knowledge of the Company, any beneficial owner
(as that term is defined in Rule 13d-3 under the Exchange Act) 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 Participants a copy of any disclosures provided thereunder.

 

4.31        Other Covered Persons. Other than the Placement Agents, the Company
is not aware of any person (other than any Issuer Covered Person) that has been
or will be paid (directly or indirectly) remuneration for solicitation of
Participants in connection with the sale of any Securities.

 

4.32        Notice of Disqualification Events. The Company will notify the
Participants and the Placement Agents in writing, prior to the Closing Date of
(i) any Disqualification Event relating to any Issuer Covered Person and (ii)
any event that would, with the passage of time, reasonably be expected to become
a Disqualification Event relating to any Issuer Covered Person, in each case of
which it is aware.

 

4.33        Securities Act Exemption. Assuming and relying in part on the truth
and accuracy of Participants’ representations and warranties in Section 5 of
this Agreement, the offer, sale and issuance of the Securities is exempt from
registration under the Securities Act.

 

4.34        Brokers. Except for the engagement of JMP Securities LLC, H. C.
Wainwright & Co. and Ladenburg Thalmann Financial Services Inc. (collectively,
the “Placement Agents”) by the Company, neither the Company nor any of the
officers, directors or employees of the Company has employed any broker or
finder in connection with the transaction contemplated by this Agreement. The
Company shall indemnify each Participant from and against any broker’s, finder’s
or agent’s fees for which the Company is responsible.

 

SECTION 5.        REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PARTICIPANT.

 

5.1          Authority, Approval and Enforceability.

 

Each Participant, severally and not jointly, represents and warrants to and
covenants with the Company that:

 

(a)           Participant has full power and authority to execute, deliver and
perform its obligations under this Agreement and all agreements, instruments and
documents contemplated hereby, and all action of Participant necessary for such
execution, delivery and performance has been duly taken.

 

11

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

 

(b)           Participant’s execution, delivery and performance of this
Agreement has been duly authorized by all requisite action by Participant. Upon
the execution and delivery by Participant, and assuming the valid execution and
delivery of this Agreement by the Company, this Agreement will constitute a
valid and binding obligation of Participant, enforceable 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), including
specific performance, and except to the extent that the enforceability of the
indemnification provisions of Section 9.4 may be legally unenforceable.

 

5.2          Investment Representations. Each Participant understands that the
Securities have not been registered under the Securities Act. Each Participant
also understands that the Securities are being offered and sold pursuant to an
exemption from registration contained in the Securities Act based in part upon
Participant’s representations contained in the Agreement. Each Participant
hereby represents and warrants as follows:

 

(a)           Participant has substantial experience in evaluating and investing
in private placement transactions of securities in companies similar to the
Company so that it is capable of evaluating the merits and risks of its
investment in the Company and has the capacity to protect its own interests.
Participant must bear the economic risk of this investment indefinitely unless
the Securities are registered pursuant to the Securities Act, or an exemption
from registration is available. Participant understands that there is no
assurance that any exemption from registration under the Securities Act will be
available and that, even if available, such exemption may not allow Participant
to transfer all or any portion of the Securities under the circumstances, in the
amounts or at the times Participant might propose.

 

(b)           Participant has been advised or is aware of the provisions of Rule
144 promulgated under the Securities Act, which permits limited resale of shares
purchased in a private placement subject to the satisfaction of certain
conditions.

 

(c)           The Participant agrees that it will not sell, pledge, assign,
transfer, otherwise dispose of or reduce its risk with respect to (collectively,
“Transfer”) any of the Securities unless the Transfer will be made pursuant to
an exemption from the registration requirements of the Securities Act or
pursuant to an effective registration statement under the Securities Act and
pursuant to an exemption from any applicable state securities laws or an
effective registration or other qualification under any applicable state
securities laws. The Participant understands that exemptions from such
registration requirements are limited. The Company is under no obligation to
register the Securities except as provided in Section 9.

 

(d)           The Participant acknowledges and agrees that the Securities are
subject to certain restrictions as to resale under the federal and state
securities laws. The Participant agrees and understands that stop transfer
instructions will be given to the transfer agent for the Shares and Warrant
Shares, and each book entry therefor shall include, or, if applicable, each
share certificate and each certificate delivered on transfer of or in
substitution for any such certificate, shall have affixed, a legend in
substantially the following form:

 

“The shares represented by this book entry or certificate have not been
registered under the Securities Act of 1933, as amended (the “Act”), and may not
be offered, sold or

 

12

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

 

otherwise transferred, assigned, pledged or hypothecated unless and until
registered under the Act or unless the Company has received an opinion of
counsel satisfactory to the Company and its counsel that such registration is
not required.”

 

(e)           The book entries or certificates evidencing the Shares and Warrant
Shares shall not contain any legend restricting the transfer thereof (including
the legend set forth above in Section 5.2(d)): (A) while a registration
statement covering the sale or resale of such security is effective under the
Securities Act, or (B) following any sale of such Shares and/or Warrant Shares
pursuant to Rule 144, or (C) if such Shares and/or Warrant Shares are eligible
for sale under Rule 144(b)(1), or (D) if such legend is not required under
applicable requirements of the Securities Act (including judicial
interpretations and pronouncements issued by the staff of the SEC)
(collectively, the “Unrestricted Conditions”). Upon request by the Participant,
the Company shall cause its counsel to issue a legal opinion to its transfer
agent promptly after such time as the Unrestricted Conditions have been met, if
required by the Company’s transfer agent to effect the issuance of the Shares
and/or Warrant Shares without a restrictive legend or removal of the legend
hereunder; provided that no such opinion will be required if (A) in this Section
is the only Unrestricted Condition satisfied. If the Unrestricted Conditions are
met at the time of issuance of the Shares and/or Warrant Shares, then such
Shares and/or Warrant Shares shall be issued free of all legends. The Company
agrees that following the Effective Date (as defined below) at such time as the
Unrestricted Conditions are met, it will, no later than three (3) Trading Days
(as defined below) following the delivery by the Participant to the Company or
the transfer agent of the written notice that the Unrestricted Conditions are
met, remove or cause to be removed all restrictive and other legends from the
book entries and certificates for the applicable Shares and/or Warrant Shares.
For the purposes hereof, “Trading Day” means any day on which the ordinary
shares are traded on the Nasdaq Stock Market, or, if the Nasdaq Stock Market is
not the principal trading market for the ordinary shares, then on the principal
securities exchange or securities market on which the ordinary shares are then
traded; provided that “Trading Day” shall not include any day on which the
ordinary shares are scheduled to trade on such exchange or market for less than
4.5 hours or any day that the ordinary shares are suspended from trading during
the final hour of trading on such exchange or market (or if such exchange or
market does not designate in advance the closing time of trading on such
exchange or market, then during the hour ending at 4:00 p.m., New York Time)

 

(f)            Participant is acquiring the Securities for Participant’s own
account and not with a view towards their distribution in violation of the
Securities Act.

 

(g)           Participant represents that by reason of its, or of its
management’s, business or financial experience, Participant has the capacity to
protect its own interests in connection with the transactions contemplated in
this Agreement. Further, Participant is aware of no publication of any
advertisement in connection with the transactions contemplated in the Agreement.

 

(h)           Participant represents that it is an accredited investor within
the meaning of Regulation D under the Securities Act.

 

(i)            Participant has had an opportunity to discuss the Company’s
business, management and financial affairs with directors, officers and
management of the Company and has had the opportunity to review the Company’s
operations and facilities. Participant has also

 

13

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

 

had the opportunity to ask questions of and receive answers from, the Company
and its management regarding the terms and conditions of this investment.

 

5.3          Brokers. Other than as disclosed to the Company, neither the
Participants nor any of their respective officers, directors or employees has
employed any broker or finder in connection with the transaction contemplated by
this Agreement. Each Participant shall severally, and not jointly, indemnify the
Company and the other Participants from and against any broker’s, finder’s or
agent’s fees for which such indemnifying Participant is responsible.

 

5.4          Acknowledgments Regarding Placement Agents. Each Participant
acknowledges that each Placement Agent has acted solely as placement agent for
the Company in connection with the offering of the Securities by the Company,
that certain of the information and data provided to such Participant in
connection with the transactions contemplated hereby have not been subjected to
independent verification by any Placement Agent, and that no Placement Agent
makes any representation or warranty with respect to the accuracy or
completeness of such information, data or other related disclosure material.
Each Participant further acknowledges that in making its decision to enter into
this Agreement and purchase Shares and a Warrant it has relied on its own
examination of the Company and the terms of, and consequences, of holding the
Securities. Each Participant further acknowledges that the provisions of this
Section 5.4 are also for the benefit of, and may also be enforced by, each
Placement Agent.

 

SECTION 6.        SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS.
Notwithstanding any investigation made by any party to this Agreement, all
covenants, agreements, representations and warranties made by the Company and
each Participant herein shall survive the execution of this Agreement and the
issuance and sale to the Participants of the Securities and shall terminate upon
the subsequent transfer of the Shares pursuant to Section 5 or Section 9.

 

SECTION 7.        CONDITIONS TO COMPANY’S OBLIGATIONS AT THE CLOSING. The
Company’s obligation to complete the sale and issuance of the Securities at each
Closing shall be subject to the following conditions to the extent not waived by
the Company:

 

7.1          Representations and Warranties Correct. The representations and
warranties made by each Participant in Section 5 hereof shall be true and
correct when made, and shall be true and correct on the date of the applicable
Closing.

 

7.2          Covenants Performed. All covenants, agreements and conditions
contained in this Agreement to be performed by the Participants on or prior to
the date of the applicable Closing shall have been performed or complied with in
all material respects.

 

7.3          Qualifications. All authorizations, approvals, or permits, if any,
of any governmental authority or regulatory body of the United States or of any
state that are binding upon any of the Participants and that are required in
connection with the lawful sale and issuance of the Securities at such Closing
pursuant to this Agreement shall have been duly obtained and shall be effective
on and as of the date of such Closing. No stop order or other order enjoining
the sale of the Securities shall have been issued and no proceedings for such
purpose shall be pending or, to the knowledge of the Company, threatened by the
SEC or any commissioner of corporations or similar officer of any state having
jurisdiction over this transaction.

 

14

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

 

7.4          Legal Investment. At the time of such Closing, the sale and
issuance of the Securities to be subscribed for and sold at such Closing shall
be legally permitted by all laws and regulations to which the Participant and
the Company are subject.

 

SECTION 8.        CONDITIONS TO PARTICIPANTS’ OBLIGATIONS AT THE CLOSING. Each
Participant’s obligation to purchase the Securities at each Closing thereby
shall be subject to the following conditions to the extent not waived by such
Participant:

 

8.1          Representations and Warranties Correct. The representations and
warranties made by the Company in Section 4 hereof shall be true and correct
when made, and shall be true and correct as of the date of the Initial Closing.

 

8.2          Legal Opinion. Participants shall have received from each of
Katzenell Dimant Frank, Israeli counsel to the Company, and Cooley LLP, U.S.
counsel to the Company, an opinion letter addressed to the Participants, dated
as of the date of the Initial Closing, in a form reasonably accetpable to the
Participants.

 

8.3          Covenants Performed. All covenants, agreements and conditions
contained herein to be performed by the Company on or prior to the date of the
Initial Closing shall have been performed or complied with in all material
respects.

 

8.4          Qualifications. All authorizations, approvals, or permits, if any,
of any governmental authority or regulatory body of the United States or of any
state that are binding upon the Company and that are required in connection with
the lawful sale and issuance of the Shares at such Closing pursuant to this
Agreement shall have been duly obtained and shall be effective on and as of the
date of the Initial Closing. No stop order or other order enjoining the sale of
the Securities shall have been issued and no proceedings for such purpose shall
be pending or, to the knowledge of the Company, threatened by the SEC, or any
commissioner of corporations or similar officer of any state having jurisdiction
over this transaction.

 

8.5          Legal Investment. At the time of each Closing, the sale and
issuance of the Securities shall be legally permitted by all laws and
regulations to which the Participant and the Company are subject.

 

8.6          Compliance Certificate. The Company shall have delivered to
Participants, a Compliance Certificate, executed by the Chief Executive Officer
of the Company, as of the date of each Closing, to the effect that the
conditions, specified in Sections 8.1, 8.3 and 8.4 have been satisfied.

 

8.7          Lock-Up Agreements. The Company’s directors and officers shall have
executed and delivered customary “lock-up” agreements with lock-up periods of
180 days from the date of each Closing.

 

In the event that any of the conditions set forth above have not been satisfied
as of the date of the Initial Closing, each Participant shall have the right,
upon the delivery of written notice to the Company, to terminate this Agreement,
and upon the delivery of such written notice, such Participant shall have no
further obligations under this Agreement whatsoever, including, without
limitation, with respect to the purchase of any Shares or Warrants.

 

15

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

 

SECTION 9.        REGISTRATION OF THE SHARES; COMPLIANCE WITH THE SECURITIES
ACT; ADDITIONAL AGREEMENTS.

 

9.1          Definitions. As used in this Section 9 the following terms shall
have the following respective meanings:

 

(a)           “Registrable Shares” shall mean (i) the Shares issued and Warrant
Shares issued or issuable pursuant to this Agreement and (ii) any other ordinary
shares issued or issuable in respect to the Shares and Warrant Shares (because
of stock splits, stock dividends, reclassifications, recapitalizations, or
similar events);

 

(b)           “Registration Statement” shall mean any registration statement and
shall include any preliminary prospectus, final prospectus, exhibit, supplement
or amendment included in or relating to the Registration Statement referred to
in Section 9.2 and Section 9.4; and

 

(c)           “Untrue Statement” shall include any untrue statement or alleged
untrue statement, or any omission or alleged omission to state in the
Registration Statement a material fact required to be stated therein or
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading.

 

9.2          Registration Procedures and Expenses. The Company is obligated to
do the following:

 

The Company shall:

 

(a)           As soon as reasonably practicable and in either event within
thirty (30) days immediately following the date of each Closing, such actual
date being referred to as a “Registration Date,” prepare and file with the SEC a
registration statement on Form S-3 (or, if Form S-3 is not then available, on
such form as is then available) in order to register with the SEC under the
Securities Act a sale by the Participants on a delayed or continuous basis
pursuant to Rule 415 under the Securities Act any or all of the Registrable
Shares through the automated quotation system of the Nasdaq Market or the
facilities of any national securities exchange on which the Company’s ordinary
shares are then traded, or in privately-negotiated transactions (a “Registration
Statement”);

 

(b)           subject to receipt of necessary information from the Participants,
use its best efforts to cause such Registration Statement to become effective
(the “Effective Date”) within 30 days immediately following the date of the
applicable Registration Date (a “Required Effectiveness Date”) and take all
other reasonable actions necessary under any federal law or regulation to permit
all Registrable Shares to be sold or otherwise disposed of;

 

(c)           if at any time, there is not an effective Registration Statement
covering all of the Registrable Shares and the Company shall determine to
prepare and file with the SEC a registration statement relating to an offering
for its own account or the account of others under the Securities Act of any of
its equity securities, other than on Form S-4 or Form S-8 (each as promulgated
under the Securities Act) or their then equivalents relating to equity
securities to be issued solely in connection with any acquisition of any entity
or business or equity securities issuable in connection with stock option or
other employee benefit plans, send to each Participant not then eligible to sell
all of their Registrable Shares under Rule 144 in a three-

 

16

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

 

month period, written notice of such determination and if, within ten days after
receipt of such notice, any such Participant shall so request in writing, shall
include in such registration statement all or any part of such Registrable
Shares such Participant requests to be registered; provided that: (i) in the
event that, in connection with any underwritten public offering, the managing
underwriter(s) thereof shall impose a limitation on the number of ordinary
shares which may be included in the Registration Statement because, in such
underwriter(s)’ judgment, marketing or other factors dictate such limitation is
necessary to facilitate public distribution, then the Company shall be obligated
to include in such Registration Statement only such limited portion of the
Registrable Shares with respect to which such Participant has requested
inclusion hereunder as the underwriter shall permit; (ii) if an offering in
connection with which a Participant is entitled to registration under this
Section 9.2(c) is an underwritten offering, then each Participant whose
Registrable Shares are included in such Registration Statement shall, unless
otherwise agreed by the Company, offer and sell such Registrable Shares in an
underwritten offering using the same underwriter or underwriters and, subject to
the provisions of this Agreement, on the same terms and conditions as other
ordinary shares included in such underwritten offering and shall enter into an
underwriting agreement in a form and substance reasonably satisfactory to the
Company and the underwriter or underwriters; and (iii) upon the effectiveness
the registration statement for which piggy-back registration has been provided
in this Section 9.2(c), any Event Payments payable to a Participant whose Shares
are included in such registration statement shall terminate and no longer be
payable;

 

(d)           promptly notify each Participant, at any time when a prospectus
relating to such Registration Statement is required to be delivered under the
Securities Act, of the happening of any event as a result of which the
prospectus included in or relating to such Registration Statement contains an
untrue statement of a material fact or omits to state any fact necessary to make
the statements therein not misleading;

 

(e)           promptly prepare and file with the SEC, and deliver to each
Participant, such amendments and supplements to such Registration Statement and
the prospectus used in connection therewith as may be necessary to keep such
Registration Statement effective until the earlier of (i) the third anniversary
of the date of the Initial Closing or (ii) termination of such obligation as
provided in Section 9.8 below;

 

(f)            furnish to each Participant such number of copies of prospectuses
in conformity with the requirements of the Securities Act, in order to
facilitate the public sale or other disposition of all or any of the Registrable
Shares by the Participants;

 

(g)           no later than the applicable Registration Date, file such
documents as may be required of the Company for normal state securities law
clearance for the resale of the Registrable Shares in which states of the United
States as may be reasonably requested by each Participant provided, however,
that the Company shall not be required in connection with this paragraph (f) to
qualify as a foreign corporation or execute a general consent to service of
process in any jurisdiction;

 

(h)           no later than the applicable Registration Date, use its best
efforts to cause all Registrable Shares to be listed on each securities
exchange, if any, on which equity securities by the Company are then listed; and

 

(i)            bear all expenses in connection with the procedures in Section
9.2, other than (i) fees and expenses, if any, of counsel or other advisers to
the Participants, and (ii) any

 

17

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

 

expenses relating to the sale of the Registrable Shares by the Participants,
including broker’s commission, discounts or fees and transfer taxes.

 

9.3          Liquidated Damages. Should an Event (as defined below) occur, then
upon the occurrence of such Event and on every monthly anniversary thereof until
the applicable Event is cured, the Company shall pay to each Participant an
amount in cash, as liquidated damages and not as a penalty, equal to one percent
(1.0%) of the aggregate purchase price of the Registrable Shares then held by
the Participant (which remedy shall be exclusive of any other remedies available
under this Agreement or under applicable law); provided, however, that the total
amount of payments pursuant to this Section shall not exceed, when aggregated
with all such payments paid to all Participants, five percent (5%) of the
aggregate purchase price of the Registrable Shares then held by the Participant.
The payments to which a Participant shall be entitled pursuant to this Section
are referred to herein as “Event Payments.” Any Event Payments payable pursuant
to the terms hereof shall apply on a pro rated basis for any portion of a month
prior to the cure of an Event. In the event the Company fails to make Event
Payments in a timely manner, such Event Payments shall bear interest at the rate
of one percent (1.0%) per month (prorated for partial months) until paid in
full. All pro rated calculations made pursuant to this paragraph shall be based
upon the actual number of days in such pro rated month. The parties agree that
the Company will not be liable for liquidated damages under this Section with
respect to (1) any period after the termination of the Company’s obligations
under Section 9.8 and (2) any Registrable Shares that are not permitted by the
SEC to be included in a Registration Statement, based solely on the SEC’s
determination that such Registrable Shares are not permitted to be registered in
accordance with Rule 415 under the Securities Act in accordance with the SEC’s
review and interpretation of its own guidance or restrictions and only to the
extent such cut-back is not based on any action taken by the Company to register
shares other than the Registrable Securities after the date hereof (and in such
case, the Event Payments shall be calculated to only apply to the percentage of
Registrable Securities that are permitted by the SEC to be included in such
Registration Statement). In the event that the Company registers some but not
all of the Registrable Shares, the 1.0% of liquidated damages referred to above
for any monthly period shall be reduced to equal the percentage determined by
multiplying 1.0% by a fraction, the numerator of which shall be the number of
Registrable Shares for which there is not an effective Registration Statement at
such time and the denominator of which shall be the number of Registrable Shares
at such time. Notwithstanding the foregoing, the applicable Registration Date or
Required Effectiveness Date for a Registration Statement shall be extended
without Event Payments hereunder in the event that the Company’s failure to file
or obtain the effectiveness of such Registration Statement on a timely basis
results from (i) the failure of any Participant to timely provide the Company
with information reasonably requested by the Company and necessary to complete
the Registration Statement in accordance with the requirements of the Securities
Act or (ii) events or circumstances that are not in any way attributable to the
Company’s actions or inactions, including, but not limited to, the failure of
any Participant to promptly notify the Company when it has sold substantially
all of its Registrable Shares covered by a Registration Statement or to
otherwise comply with the terms of this Agreement, and in any event, no
Participant causing the failure described in (i) or (ii), above shall be
entitled to Event Payments relating to the failure caused by such Participant.

 

For such purposes, each of the following shall constitute an “Event”:

 

(i) a Registration Statement is not declared effective on or prior to its
applicable Required Effectiveness Date; and

 

18

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

 

(ii) except as provided for in Section 9.5, after the Effective Date of a
Registration Statement and through the earlier of (i) the third anniversary of
the date of the Initial Closing or (ii) the termination of the Company’s
obligations under Section 9.8, a Participant is not permitted to sell
Registrable Shares under the Registration Statement (or a subsequent
Registration Statement filed in replacement thereof) for any reason (other than
the fault of such Participant).

 

9.4          Indemnification

 

(a)           The Company agrees to indemnify and hold harmless each Participant
and underwriter (and each person, if any, who controls the Participant within
the meaning of Section 15 of the Securities Act) from and against any losses,
claims, damages or liabilities to which such Participant (or such underwriter or
controlling person) may become subject (under the Securities Act or otherwise)
insofar as such losses, claims, damages or liabilities (or actions or
proceedings in respect thereof) arise out of, or are based upon, any Untrue
Statement contained in the Registration Statement on the Effective Date thereof,
or arise out of any failure by the Company to fulfill any undertaking included
in the Registration Statement and the Company will reimburse such Participant
(or such underwriter or controlling person) for any reasonable legal or other
expenses reasonably incurred in investigating, defending or preparing to defend
any such action, proceeding or claim; provided, however, that the Company shall
not be liable in any such case to the extent that such loss, claim, damage or
liability arises out of, or is based upon, an Untrue Statement made in such
Registration Statement in reliance upon and in conformity with written
information furnished to the Company by or on behalf of such Participant
specifically for use in preparation of the Registration Statement, or the
failure of such Participant to comply with the covenants and agreements
contained in Section 9.5 hereof respecting the sale of the Registrable Shares or
any statement or omission in any prospectus that is corrected in any subsequent
prospectus that was delivered to the Participant prior to the pertinent sale or
sales by the Participant.

 

(b)           Each Participant, severally and not jointly, agrees to indemnify
and hold harmless the Company and underwriter (and each person, if any, who
controls the Company within the meaning of Section 15 of the Securities Act,
each officer of the Company who signs the Registration Statement and each
director of the Company) from and against any losses, claims, damages or
liabilities to which the Company (or any such underwriter, officer, director or
controlling person) may become subject (under the Securities Act or otherwise),
insofar as such losses, claims, damages or liabilities (or actions or
proceedings in respect thereof) arise out of, or are based upon, any Untrue
Statement contained in the Registration Statement on the Effective Date thereof
if such Untrue Statement was made in reliance upon and in conformity with
written information furnished by or on behalf of such Participant specifically
for use in preparation of the Registration Statement, and such Participant will
reimburse the Company (or such underwriter, officer, director or controlling
person), as the case may be, for any legal or other expenses reasonably incurred
in investigating, defending or preparing to defend any such action, proceeding
or claim; provided that in no event shall any indemnity by a Participant under
this Section 9.4 exceed the net proceeds received by such Participant from the
sale of the Registrable Shares covered by such Registration Statement.

 

(c)           Promptly after receipt by any indemnified person of a written
notice of a claim or the beginning of any action in respect of which indemnity
is to be sought against an indemnifying person pursuant to this Section 9.4,
such indemnified person shall notify the indemnifying person in writing of such
claim or of the commencement of such action, and,

 

19

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

 

subject to the provisions hereinafter stated, in case any such action shall be
brought against an indemnified person and such indemnifying person shall have
been notified thereof, such indemnifying person shall be entitled to participate
therein, and, to the extent it shall wish, to assume the defense thereof, with
counsel reasonably satisfactory to such indemnified person. After notice from
the indemnifying person to such indemnified person of its election to assume the
defense thereof, such indemnifying person shall not be liable to such
indemnified person for any legal expenses subsequently incurred by such
indemnified person in connection with the defense thereof; provided, however,
that if there exists or shall exist a conflict of interest that would make it
inappropriate, in the opinion of counsel to the indemnified person, for the same
counsel to represent both the indemnified person and such indemnifying person or
any affiliate or associate thereof, the indemnified person shall be entitled to
retain its own counsel at the expense of such indemnifying person; provided,
however, that no indemnifying person shall be responsible for the fees and
expenses of more than one separate counsel for all indemnified parties;
provided, however, that no person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.

 

(d)           If the indemnification provided for in this Section 9.4 is held by
a court of competent jurisdiction to be unavailable to an indemnified party with
respect to any loss, liability, claim, damage, or expense referred to therein,
then the indemnifying party, in lieu of indemnifying such indemnified party
hereunder, shall contribute to the amount paid or payable by such indemnified
party as a result of such loss, liability, claim, damage, or expense in such
proportion as is appropriate to reflect the relative fault of the indemnifying
party on the one hand and of the indemnified party on the other in connection
with the statements or omissions that resulted in such loss, liability, claim,
damage, or expense as well as any other relevant equitable considerations. The
relative fault of the indemnifying party and of the indemnified party shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of material fact or the omission to state a material fact
relates to information supplied by the indemnifying party or by the indemnified
party and the parties’ relative intent, knowledge, access to information, and
opportunity to correct or prevent such statement or omission; provided, that in
no event shall any contribution by a Participant hereunder exceed the net
proceeds received by such Participant from the sale of the Shares covered by the
Registration Statement.

 

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

 

9.5          Transfer of Shares After Registration; Notice. Each Participant
hereby covenants with the Company not to make any sale of the Registrable Shares
after registration without effectively causing the prospectus delivery
requirement under the Securities Act to be satisfied, unless a valid exemption
from registration under the Securities Act is available. Each Participant
acknowledges that there may be times when the Company must suspend the use of
the prospectus forming a part of the Registration Statement until such time as
an amendment to the Registration Statement has been filed by the Company and
declared effective by the SEC, or until such time as the Company has filed an
appropriate report with the SEC pursuant to the Exchange Act. Each Participant
hereby covenants that it will not sell any Registrable Shares pursuant to said
prospectus during the period commencing at the time at which the Company

 

20

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

 

gives the Participant written notice of the suspension of the use of said
prospectus and ending at the time the Company gives the Participant notice that
the Participant may thereafter effect sales pursuant to said prospectus,
provided, however, that the Company shall not suspend the use of said prospectus
more than two times in any twelve month period and the duration of any one such
suspension shall not be more than thirty (30) days. The foregoing provisions of
this Section 9.5 shall in no manner diminish or otherwise impair the Company’s
obligations under Section 9.2 and Section 9.4 hereof.

 

9.6          Reporting Requirements. The Company agrees to use its best efforts
to:

 

(a)           make and keep public information available, as those terms are
understood and defined in Rule 144 under the Securities Act;

 

(b)           file with the SEC in a timely manner all reports and other
documents required of the Company under the Securities Act and the Securities
Exchange Act of 1934; and

 

(c)           so long as any of the Participants own Registrable Shares, to
furnish to the Participants forthwith upon request a written statement by the
Company as to whether it complies with the reporting requirements of said
Rule 144, the Securities Act and Securities Exchange Act of 1934, and whether it
qualifies as a registrant whose securities may be resold pursuant to SEC
Form S-3.

 

9.7          Company Lock-Ups.

 

(a)           During the periods commencing on the date of each Closing and
ending on the date immediately following the 180 day anniversary of the date of
each Closing (the “Restricted Period”), neither the Company nor any of its
subsidiaries shall directly or indirectly issue, offer, sell, grant any option
or right to purchase, or otherwise dispose of (or announce any issuance, offer,
sale, grant of any option or right to purchase or other disposition of) any
equity security or any equity-linked or related security (including, without
limitation, any “equity security” (as that term is defined under Rule 405
promulgated under the Securities Act), any Ordinary Share Equivalents, any debt,
any preferred shares or any purchase rights). For purposes hereof, “Ordinary
Share Equivalents” means any securities of the Company or its subsidiaries which
would entitle the holder thereof to acquire at any time ordinary shares,
including, without limitation, any debt, preferred shares, rights, options,
warrants or other instrument that is at any time convertible into or exercisable
or exchangeable for, or otherwise entitles the holder thereof to receive,
ordinary shares.

 

(b)           Notwithstanding the foregoing, Sections 9.7(a) shall not apply in
respect of an Exempt Issuance. For purposes hereof, “Exempt Issuance” shall mean
the issuance of (a) ordinary shares or options to employees, officers or
directors of, or consultants to, the Company pursuant to any stock or option
plan duly adopted by the Board of Directors for such purpose, including, but not
limited to, the Company’s 2013 Stock Incentive Subplan and the Company’s Amended
and Restated 2009 Stock Incentive Plan and (b) ordinary shares issued upon the
conversion or exercise of Ordinary Share Equivalents issued prior to the
Effective Date.

 

(c)           Until the Applicable Date (as defined below) and at any time
thereafter while any Registration Statement is not effective or any prospectus
contained therein is not available for use, the Company shall not file any
registration statement under the Securities Act relating to securities that are
not the Registrable Shares. For purposes hereof, “Applicable Date”

 

21

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

 

means the first date on which the resale by the Participant of all its
Registrable Shares is covered by one or more effective Registration Statements
(and each prospectus contained therein is available for use on such date).

 

9.8          Termination of Obligations. The obligations of the Company pursuant
to Sections 9.2 through 9.7 hereof shall cease and terminate upon the earlier to
occur of (i) such time as all of the Registrable Shares have been resold or
(ii) as to each Participant, such time as all of the Registrable Shares held by
such Participant may be sold during any 90 day period pursuant to Rule 144
without being restricted by the volume limitations of Rule 144(e).

 

9.9          Assignability of Registration Rights. The registration rights set
forth in this Section 9 are assignable in connection with the assignment of any
Registrable Shares.

 

9.10        Integration. The Company shall not sell, offer for sale or solicit
offers to buy or otherwise negotiate in respect of any security (as defined in
Section 2 of the Securities Act) that would be integrated with the offer or sale
of the Securities for purposes of the rules and regulations of any trading
market such that it would require shareholder approval prior to the closing of
such other transaction unless shareholder approval is obtained before the
closing of such subsequent transaction.

 

9.11        Shareholder Rights Plan. No claim will be made or enforced by the
Company or, with the consent of the Company, any other person, that any
Participant is an “Acquiring Person” under any control share acquisition,
business combination, poison pill (including any distribution under a rights
agreement) or similar anti-takeover plan or arrangement in effect or hereafter
adopted by the Company, or that any Participant could be deemed to trigger the
provisions of any such plan or arrangement, by virtue of receiving Securities
under this Agreement or under any other agreement between the Company and the
Participants.

 

9.12        Non-Public Information. The Company covenants and agrees that
neither it, nor any other person acting on its behalf will provide any
Participant or its agents or counsel with any information that constitutes, or
the Company reasonably believes constitutes, material non-public information,
unless prior thereto such Participant shall have consented to the receipt of
such information and agreed with the Company to keep such information
confidential. To the extent that the Company delivers any material, non-public
information to a Participant without such Participant’s consent, the Company
hereby covenants and agrees that such Participant shall not have any duty of
confidentiality to the Company or any of its officers, directors, agents,
employees or affiliates, or a duty to the Company or any of its officers,
directors, agents, employees or affiliates not to trade on the basis of, such
material, non-public information, provided that the Participant shall remain
subject to applicable law. To the extent that any notice provided pursuant to
this Agreement constitutes, or contains, material, non-public information
regarding the Company, the Company shall simultaneously file such notice with
the SEC pursuant to a Current Report on Form 8-K. The Company understands and
confirms that each Participant shall be relying on the foregoing covenant in
effecting transactions in securities of the Company.

 

9.13        Use of Proceeds. The Company shall use the net proceeds from the
sale of the Securities hereunder for working capital purposes primarily to fund
precommercialization scale up activities and, if approved, initial
commercialization activities for the Company’s lead drug candidate, Trevyent for
PAH, as well as further development of the Company’s AHPA product candidates and
shall not use such proceeds: (a) for the satisfaction of any portion of the

 

22

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

 

Company’s debt (other than payment of trade payables in the ordinary course of
the Company’s business and prior practices or debt disclosed in the SEC
Reports), (b) for the redemption of any common stock or common stock equivalents
except for any Company right of repurchase that may be applicable to exercised
stock options, (c) for the settlement of any outstanding litigation or (d) in
violation of FCPA or OFAC regulations.

 

9.14        Reservation of Shares. 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 for the purpose
of enabling the Company to issue Shares pursuant to this Agreement and shares
underlying the Warrants pursuant to any exercise of the Warrants.

 

9.15        Listing of Shares. The Company hereby agrees to use best efforts to
maintain the listing or quotation of the Shares on the trading market on which
it is currently listed, and prior to or concurrently with the Closing, the
Company shall apply to list or quote all of the Shares and shares underlying the
Warrants on such trading market and promptly secure the listing of all of the
Shares and shares underlying the Warrants on such trading market. The Company
further agrees, if the Company applies to have the Shares traded on any other
trading market, it will then include in such application all of the Shares and
shares underlying the Warrants, and will take such other action as is necessary
to cause all of the Shares and shares underlying the Warrants 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 Shares 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. The Company agrees to use best efforts to maintain the
eligibility of the Shares for electronic transfer through the Depository Trust
Company or another established clearing corporation, including, without
limitation, by timely payment of fees to the Depository Trust Company or such
other established clearing corporation in connection with such electronic
transfer.

 

9.16        Equal Treatment of Participants. 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 also offered to all of the parties to this Agreement.
For clarification purposes, this provision constitutes a separate right granted
to each Participant by the Company and negotiated separately by each
Participant, and is intended for the Company to treat the Participants as a
class and shall not in any way be construed as the Participants acting in
concert or as a group with respect to the purchase, disposition or voting of
Securities or otherwise.

 

9.17        Exercise Procedures. The form of Notice of Exercise included in the
Warrants set forth the totality of the procedures required of the Participants
in order to exercise the Warrants. No additional legal opinion, other
information or instructions shall be required of the Participants to exercise
their Warrants. Without limiting the preceding sentences, no ink-original Notice
of Exercise shall be required, nor shall any medallion guarantee (or other type
of guarantee or notarization) of any Notice of Exercise form be required in
order to exercise the Warrants. The Company shall honor exercises of the
Warrants and shall deliver shares underlying the Warrants in accordance with the
terms, conditions and time periods set forth therein.

 

9.18        Acknowledgment of Dilution. The Company acknowledges that the
issuance of the Securities may result in dilution of the outstanding Shares,
which dilution may be substantial under certain market conditions. The Company
further acknowledges that its obligations,

 

23

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

 

including, without limitation, its obligation to issue the Shares and shares
underlying the Warrants, are unconditional and absolute and not subject to any
right of set off, counterclaim, delay or reduction, regardless of the effect of
any such dilution or any claim the Company may have against any Participant and
regardless of the dilutive effect that such issuance may have on the ownership
of the other stockholders of the Company.

 

9.19        Compliance. The Company covenants and agrees that it shall not (and
shall not permit any of its subsidiaries or affiliates or any of its or their
respective directors, officers, managers, employees, independent contractors,
representatives or agents to) promise, authorize or make any payment to, or
otherwise contribute any item of value to, directly or indirectly, to any third
party, including any Non-U.S. Official (as such term is defined in FCPA), in
each case, in violation of the FCPA, the U.K. Bribery Act, or any other
applicable anti-bribery or anti-corruption law. The Company further covenants
and agrees that it shall (and shall cause each of its subsidiaries and
affiliates to) cease all of its or their respective activities, as well as
remediate any actions taken by the Company, its subsidiaries or affiliates, or
any of their respective directors, officers, managers, employees, independent
contractors, representatives or agents in violation of the FCPA, the U.K.
Bribery Act, or any other applicable anti-bribery or anti-corruption law. The
Company further covenants and agrees that it shall (and shall cause each of its
subsidiaries and affiliates to) implement and maintain systems of internal
controls (including, but not limited to, accounting systems, purchasing systems
and billing systems) to ensure compliance with the FCPA, the U.K. Bribery Act,
or any other applicable anti-bribery or anti-corruption law. The Company shall,
and shall cause any direct or indirect subsidiary or entity controlled by it,
whether now in existence or formed in the future, to comply with the FCPA. The
Company shall use its best efforts to cause any direct or indirect subsidiary,
whether now in existence or formed in the future, to comply in all material
respects with all applicable laws.

 

9.20        Passive Foreign Investment Company. Upon request by the Participant,
which shall be limited to one request per each calendar year, the Company shall
make due inquiry regarding the Company’s status as a passive foreign investment
company under Section 1297 of the Code and shall promptly notify the Participant
of such status. If the Company is, in its reasonable opinion, a PFIC, unless
otherwise required by law, the Company shall reasonably cooperate with the
Participant and use commercially reasonable efforts to provide the Participant
with the information required by the Participant for purposes of making a
mark-to-market election under Section 1296 of the Code or a qualified electing
fund election pursuant to Section 1295 of the Code.

 

SECTION 10.      NOTICES. All notices, requests, consents and other
communications hereunder shall be in writing, shall be sent by confirmed
facsimile or mailed by first-class registered or certified airmail, or
nationally recognized overnight express courier, postage prepaid, and shall be
deemed given when so sent and addressed as follows:

 

(a)           if to the Company, to:

 

SteadyMed Ltd.

2603 Camino Ramon, Suite 350

San Ramon, CA 94583

Tel: (925) 272-4999

Attention: Chief Financial Officer

 

24

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

 

with a copy to:

 

Cooley LLP

3175 Hanover Street

Palo Alto, California 94304

Attention: Michael E. Tenta

 

or to such other person at such other place as the Company shall designate to
the Participants in writing; and

 

(b)           if to a Participant, at the address as set forth on such
Participant’s signature page at the end of this Agreement, or at such other
address or addresses as may have been furnished to the Company in writing.

 

SECTION 11.      MISCELLANEOUS.

 

11.1        Waivers and Amendments. Neither this Agreement nor any provision
hereof may be changed, waived, discharged, terminated, modified or amended
except upon the written consent of the Company and holders of at least 662/3% of
the Shares issued pursuant to this Agreement.

 

11.2        Headings. The headings of the various sections of this Agreement
have been inserted for convenience of reference only and shall not be deemed to
be part of this Agreement.

 

11.3        Severability. In case any provision contained in this Agreement
should be invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein shall
not in any way be affected or impaired thereby.

 

11.4        Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York, without regard to conflicts
of law principles.

 

11.5        Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall constitute an original, but all of which, when
taken together, shall constitute but one instrument, and shall become effective
when one or more counterparts have been signed by each party hereto and
delivered to the other parties.

 

11.6        Successors and Assigns. Except as otherwise expressly provided
herein, the provisions hereof shall inure to the benefit of, and be binding
upon, the successors, assigns, heirs, executors and administrators of the
parties hereto.

 

11.7        Expenses. Each party shall pay all costs and expenses that it incurs
with respect to the negotiation, execution, delivery and performance of this
Agreement; provided, however, that the Company shall, at each Closing, reimburse
the reasonable fees of and expenses, including legal fees, of OrbiMed Advisors
LLC incurred in connection with the Offering, not to exceed $100,000 in the
aggregate for all Closings.

 

11.8        Entire Agreement. This Agreement and other documents delivered
pursuant hereto, including the exhibits, constitute the full and entire
understanding and agreement between the parties with regard to the subjects
hereof and thereof.

 

25

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

 

11.9        Publicity. No party shall issue any press releases or otherwise make
any public statement with respect to the transactions contemplated by this
Agreement without the prior written consent of the other parties, except as may
be required by applicable law or regulations, in which case such party shall
provide the other parties with reasonable notice of such publicity and/or
opportunity to review such disclosure.

 

11.10      Waiver of Conflicts. Each party to this Agreement acknowledges that
U.S. counsel for the Company, Cooley LLP (“Cooley”), has in the past and may
continue in the future to perform legal services for one or more of the
Participants or their affiliates in matters unrelated to the transactions
contemplated by this Agreement, including, but not limited to, the
representation of the Participants in matters of a similar nature to the
transactions contemplated herein. Each party to this Agreement hereby
(a) acknowledges that they have had an opportunity to ask for and have obtained
information relevant to such representation, including disclosure of the
reasonably foreseeable adverse consequences of such representation;
(b) acknowledges that with respect to the transactions contemplated herein,
Cooley has represented the Company and not any individual Participant or any
individual shareholder, director or employee of the Company; and (c) gives its
informed consent to Cooley’s representation of the Company in the transactions
contemplated by this Agreement and Cooley’s representation of one or more of the
Participants or their affiliates in matters unrelated to such transactions.

 

[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

 

26

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

 

Subject to acceptance by the Company, the undersigned has completed this
Agreement to evidence his/her subscription for participation in the Offering of
Shares and Warrants of the Company, this 29th day of July, 2016 at 10:38 am.

 

PARTICIPANT

 

Name of Participant:

OrbiMed Israel Partners II, L.P.

 

 

/s/ Jonathan Silverstein

(Signature)

 

 

By:

Jonathan Silverstien

 

 

Its:

Director of the General Partner of the General Partner

 

Address for Notice and Delivery:

 

Tax ID No.:

 

Telephone:

 

Fax/email:

 

Attention:

 

Total Subscription Amount for both Initial Closing and assumed Second Closing:
$7,499,998.85

 

Number of Shares Subscribed for in the Initial Closing: 1,536,098

 

Number of Warrant Shares issuable upon exercise of Warrant Subscribed for in the
Initial Closing: 1,536,098

 

Aggregate Purchase Price in the Initial Closing (No. of shares subscribed for in
the Initial Closing multiplied by per share purchase price plus no. of warrant
shares underlying warrant subscribed for in the Initial Closing multiplied by
$0.125): $4,999,998.99

 

The number of Shares to be subscribed for and the aggregate purchase price to be
paid in the Second Closing shall be determined pursuant to Section 2 of the
Agreement.

 

The Company has accepted this subscription this 29th day of July 2016.

 

 

“COMPANY”

 

 

 

STEADYMED LTD.,

 

an Israeli incorporated company

 

 

 

 

 

 

 

By:

/s/ Jonathan Rigby

 

 

Jonathan Rigby, President & CEO

 

 

 

 

Address: 2603 Camino Ramon, Suite 350

 

 San Ramon, CA 94583

 

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

 

Subject to acceptance by the Company, the undersigned has completed this
Agreement to evidence his/her subscription for participation in the Offering of
Shares and Warrants of the Company, this 29th day of July, 2016 at 10:38 a.m.

 

PARTICIPANT

 

Name of Participant:

OrbiMed Private Investments VI, L.P.

 

 

/s/ Jonathan Silverstein

(Signature)

 

 

By Jonathan Silverstein

 

 

 

Its:Member of the Managing Member of the General Partner

 

 

Address for Notice and Delivery:

 

Tax ID No.:

 

Telephone:

 

Fax/email:

 

Attention:

 

Total Subscription Amount for both Initial Closing and assumed Second Closing:
$7,499,998.85

 

Number of Shares Subscribed for in the Initial Closing: 1,536,098

 

Number of Warrant Shares issuable upon exercise of Warrant Subscribed for in the
Initial Closing: 1,536,098

 

Aggregate Purchase Price in the Initial Closing (No. of shares subscribed for in
the Initial Closing multiplied by per share purchase price plus no. of warrant
shares underlying warrant subscribed for in the Initial Closing multiplied by
$0.125): $4,999,998.99

 

The number of Shares to be subscribed for and the aggregate purchase price to be
paid in the Second Closing shall be determined pursuant to Section 2 of the
Agreement.

 

The Company has accepted this subscription this 29th day of July 2016.

 

 

“COMPANY”

 

 

 

STEADYMED LTD.,

 

an Israeli incorporated company

 

 

 

 

 

 

By:

/s/ Jonathan Rigby

 

 

Jonathan Rigby, President & CEO

 

 

 

 

Address: 2603 Camino Ramon, Suite 350

 

 San Ramon, CA 94583

 

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

 

Subject to acceptance by the Company, the undersigned has completed this
Agreement to evidence his/her subscription for participation in the Offering of
Shares and Warrants of the Company, this 29th day of July, 2016.

 

PARTICIPANT

 

Name of Participant:

Deerfield Special Situations Fund, L.P.

 

 

/s/ David J. Clark

(Signature)

 

By:

David J. Clark

Its:

Authorized Signatory

 

Address for Notice and Delivery:

 

Tax ID No.:

 

Telephone:

 

Fax/email:

 

Attention:

 

Total Subscription Amount for both Initial Closing and assumed Second Closing:
$999,998.80

 

Number of Shares Subscribed for in the Initial Closing: 204,813

 

Number of Warrant Shares issuable upon exercise of Warrant Subscribed for in the
Initial Closing: 204,813

 

Aggregate Purchase Price in the Initial Closing (No. of shares subscribed for in
the Initial Closing multiplied by per share purchase price plus no. of warrant
shares underlying warrant subscribed for in the Initial Closing multiplied by
$0.125): $666,666.32

 

The number of Shares to be subscribed for and the aggregate purchase price to be
paid in the Second Closing shall be determined pursuant to Section 2 of the
Agreement.

 

The Company has accepted this subscription this 29th day of July 2016.

 

 

“COMPANY”

 

STEADYMED LTD.,

 

 

 

an Israeli incorporated company

 

 

 

By:

/s/ Jonathan Rigby

 

 

Jonathan Rigby, President & CEO

 

 

 

Address: 2603 Camino Ramon, Suite 350

 

San Ramon, CA 94583

 

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

 

Subject to acceptance by the Company, the undersigned has completed this
Agreement to evidence his/her subscription for participation in the Offering of
Shares and Warrants of the Company, this 29th day of July, 2016 .

 

PARTICIPANT

 

Name of Participant:

Deerfield Private Design Fund III, L.P.

 

/s/ David J. Clark

(Signature)

 

By:

David J. Clark

Its:

Authorized Signatory

 

Address for Notice and Delivery:

 

Tax ID No.:

 

Telephone:

 

Fax/email:

 

Attention:

 

Total Subscription Amount for both Initial Closing and assumed Second Closing:
$999,998.79

 

Number of Shares Subscribed for in the Initial Closing: 204,813

 

Number of Warrant Shares issuable upon exercise of Warrant Subscribed for in the
Initial Closing:   204,813

 

Aggregate Purchase Price in the Initial Closing (No. of shares subscribed for in
the Initial Closing multiplied by per share purchase price plus no. of warrant
shares underlying warrant subscribed for in the Initial Closing multiplied by
$0.125): $666,666.31

 

The number of Shares to be subscribed for and the aggregate purchase price to be
paid in the Second Closing shall be determined pursuant to Section 2 of the
Agreement.

 

The Company has accepted this subscription this 29th day of July 2016.

 

 

“COMPANY”

 

 

 

STEADYMED LTD.,

 

an Israeli incorporated company

 

 

 

By:

/s/ Jonathan Rigby

 

 

Jonathan Rigby, President & CEO

 

 

 

Address: 2603 Camino Ramon, Suite 350

 

San Ramon, CA 94583

 

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

 

Subject to acceptance by the Company, the undersigned has completed this
Agreement to evidence his/her subscription for participation in the Offering of
Shares and Warrants of the Company, this 29th day of July, 2016
                         .

 

PARTICIPANT

 

Name of Participant:  Dennis L. Berman

 

 

 

/s/ Dennis L. Berman

 

(Signature)

 

 

By:

Dennis L. Berman

 

 

Its:Self

 

 

Address for Notice and Delivery:

 

Tax ID No.:                                   

 

Telephone:

 

Fax/email:

 

Attention:

 

Total Subscription Amount for both Initial Closing and assumed Second Closing:
$199,997.18

 

Number of Shares Subscribed for in the Initial Closing: 40,962

 

Number of Warrant Shares issuable upon exercise of Warrant Subscribed for in the
Initial Closing: 40,962

 

Aggregate Purchase Price in the Initial Closing (No. of shares subscribed for in
the Initial Closing multiplied by per share purchase price plus no. of warrant
shares underlying warrant subscribed for in the Initial Closing multiplied by
$0.125): $133,331,31

 

The number of Shares to be subscribed for and the aggregate purchase price to be
paid in the Second Closing shall be determined pursuant to Section 2 of the
Agreement.

 

The Company has accepted this subscription this 29th day of July 2016.

 

 

“COMPANY”

 

 

 

STEADYMED LTD.,

 

an Israeli incorporated company

 

 

 

 

 

 

 

By:

/s/ Jonathan Rigby

 

 

Jonathan Rigby, President & CEO

 

 

 

Address: 2603 Camino Ramon, Suite 350

 

San Ramon, CA 94583

 

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

 

Subject to acceptance by the Company, the undersigned has completed this
Agreement to evidence his/her subscription for participation in the Offering of
Shares and Warrants of the Company, this 29th day of July, 2016.

 

PARTICIPANT

 

Name of Participant: Federated Kaufmann Fund, a protfolio of Federated Equity
Funds

 

/s/ Hans P. Utsch

 

(Signature)

 

By:Hans P. Utsch

 

Its:Vice President, Federated Global Investment Management, as attorney-in-fact
for Federated Kaufmann Fund, a portfolio of Federated Equity Funds

Address for Notice and Delivery

 

Tax ID No.:

 

Telephone:

 

Fax/email:

 

Attention:

 

Total Subscription Amount for both Initial Closing and assumed Second Closing:
$5,731,234.39

 

Number of Shares Subscribed for in the Initial Closing: 1,173,832

 

Number of Warrant Shares issuable upon exercise of Warrant Subscribed for in the
Initial Closing:1,173,832

 

Aggregate Purchase Price in the Initial Closing (No. of shares subscribed for in
the Initial Closing multiplied by per share purchase price plus no. of warrant
shares underlying warrant subscribed for in the Initial Closing multiplied by
$0.125): $3,820,823.16

 

The number of Shares to be subscribed for and the aggregate purchase price to be
paid in the Second Closing shall be determined pursuant to Section 2 of the
Agreement.

 

The Company has accepted this subscription this 29th day of July 2016.

 

 

“COMPANY”

 

 

 

STEADYMED LTD.,

 

an Israeli incorporated company

 

 

 

 

 

 

 

By:

/s/ Jonathan Rigby

 

 

Jonathan Rigby, President & CEO

 

 

 

Address: 2603 Camino Ramon, Suite 350

 

San Ramon, CA 94583

 

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

 

Subject to acceptance by the Company, the undersigned has completed this
Agreement to evidence his/her subscription for participation in the Offering of
Shares and Warrants of the Company, this 29th day of July, 2016.

 

PARTICIPANT

 

Name of Participant:Federated Kaufmann Small Cap Fund, a portfolio of Federated
Equity Funds

 

/s/ Hans P. Utsch

 

 

(Signature)

 

 

By:Hans P. Utsch

 

 

 

 

Its:Vice President, Federated Global Investment Management, as attorney-in-fact
for Federated Kaufmann Small Cap Fund, a portfolio of Federated Equity Funds

 

Address for Notice and Delivery:

 

Tax ID No.:                            

 

Telephone:                            

 

Fax/email:                            

 

Attention:                            

 

Total Subscription Amount for both Initial Closing and assumed Second Closing:
$729,445.45

 

Number of Shares Subscribed for in the Initial Closing: 149,400

 

Number of Warrant Shares issuable upon exercise of Warrant Subscribed for in the
Initial Closing: 149,400

 

Aggregate Purchase Price in the Initial Closing (No. of shares subscribed for in
the Initial Closing multiplied by per share purchase price plus no. of warrant
shares underlying warrant subscribed for in the Initial Closing multiplied by
$0.125): $486,297

 

The number of Shares to be subscribed for and the aggregate purchase price to be
paid in the Second Closing shall be determined pursuant to Section 2 of the
Agreement.

 

The Company has accepted this subscription this 29th day of July 2016.

 

 

“COMPANY”

 

 

 

 

STEADYMED LTD.,

 

an Israeli incorporated company

 

 

 

 

By:

/s/ Jonathan Rigby

 

 

Jonathan Rigby, President & CEO

 

 

 

 

Address: 2603 Camino Ramon, Suite 350

 

San Ramon, CA 94583

 

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

 

Subject to acceptance by the Company, the undersigned has completed this
Agreement to evidence his/her subscription for participation in the Offering of
Shares and Warrants of the Company, this 29th day of July, 2016.

 

PARTICIPANT

 

Name of Participant:  Federated Kaufmann Fund II, a portfolio of Federated
Insurance Series

 

/s/ Hans P. Utsch

 

 

(Signature)

 

 

By:Hans P. Utsch

 

 

 

 

Its:Vice President, Federated Global Investment Management, as attorney-in-fact
for Federated Kaufmann Funds II, a portfolio of Federated Insurance Series

 

Address for Notice and Delivery:

 

Tax ID No.:                            

 

Telephone:                            

 

Fax/email:                            

 

Attention:                            

 

Total Subscription Amount for both Initial Closing and assumed Second Closing:
$139,317.24

 

Number of Shares Subscribed for in the Initial Closing: 28,534

 

Number of Warrant Shares issuable upon exercise of Warrant Subscribed for in the
Initial Closing: 28,534

 

Aggregate Purchase Price in the Initial Closing (No. of shares subscribed for in
the Initial Closing multiplied by per share purchase price plus no. of warrant
shares underlying warrant subscribed for in the Initial Closing multiplied by
$0.125): $92,878.17

 

The number of Shares to be subscribed for and the aggregate purchase price to be
paid in the Second Closing shall be determined pursuant to Section 2 of the
Agreement.

 

The Company has accepted this subscription this 29th day of July 2016.

 

 

“COMPANY”

 

 

 

 

STEADYMED LTD.,

 

an Israeli incorporated company

 

 

 

 

By:

/s/ Jonathan Rigby

 

 

Jonathan Rigby, President & CEO

 

 

 

 

Address: 2603 Camino Ramon, Suite 350

 

San Ramon, CA 94583

 

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

 

Subject to acceptance by the Company, the undersigned has completed this
Agreement to evidence his/her subscription for participation in the Offering of
Shares and Warrants of the Company, this 29th day of July, 2016.

 

PARTICIPANT

 

Name of Participant: Shrewsbury Capital Partners LLC

 

/s/ Jonathan Gold

 

(Signature)

 

 

By:Jonathan Gold

 

Its:Managing Member

 

Address for Notice and Delivery:

 

Tax ID No.:

 

Telephone:

 

Fax/email:

 

Attention:

 

Total Subscription Amount for both Initial Closing and assumed Second Closing:
$249,998.84

 

Number of Shares Subscribed for in the Initial Closing: 51,203

 

Number of Warrant Shares issuable upon exercise of Warrant Subscribed for in the
Initial Closing: 51,203

 

Aggregate Purchase Price in the Initial Closing (No. of shares subscribed for in
the Initial Closing multiplied by per share purchase price plus no. of warrant
shares underlying warrant subscribed for in the Initial Closing multiplied by
$0.125): $166,665.77

 

The number of Shares to be subscribed for and the aggregate purchase price to be
paid in the Second Closing shall be determined pursuant to Section 2 of the
Agreement.

 

The Company has accepted this subscription this 29th day of July 2016.

 

 

“COMPANY”

 

 

 

STEADYMED LTD.,

 

an Israeli incorporated company

 

 

 

By:

/s/ Jonathan Rigby

 

Jonathan Rigby, President & CEO

 

 

 

Address: 2603 Camino Ramon, Suite 350

 

 San Ramon, CA 94583

 

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

 

Subject to acceptance by the Company, the undersigned has completed this
Agreement to evidence his/her subscription for participation in the Offering of
Shares and Warrants of the Company, this 29th day of July, 2016.

 

PARTICIPANT

 

Name of Participant:SteadyMed Investors III LLC

 

/s/ Keith Bank

 

(Signature)

 

 

By:Keith Bank

 

Its:VManager

 

Address for Notice and Delivery:

 

Tax ID No.:

 

Telephone:

 

Fax/email:

 

Attention:

 

Total Subscription Amount for both Initial Closing and assumed Second Closing:
$1,299,999.39

 

Number of Shares Subscribed for in the Initial Closing: 266,257

 

Number of Warrant Shares issuable upon exercise of Warrant Subscribed for in the
Initial Closing: 266,257

 

Aggregate Purchase Price in the Initial Closing (No. of shares subscribed for in
the Initial Closing multiplied by per share purchase price plus no. of warrant
shares underlying warrant subscribed for in the Initial Closing multiplied by
$0.125): $866,666.54

 

The number of Shares to be subscribed for and the aggregate purchase price to be
paid in the Second Closing shall be determined pursuant to Section 2 of the
Agreement.

 

The Company has accepted this subscription this 29th day of July 2016.

 

 

“COMPANY”

 

 

 

STEADYMED LTD.,

 

an Israeli incorporated company

 

 

 

By:

/s/ Jonathan Rigby

 

Jonathan Rigby, President & CEO

 

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

 

Subject to acceptance by the Company, the undersigned has completed this
Agreement to evidence his/her subscription for participation in the Offering of
Shares and Warrants of the Company, this 29th day of July, 2016.

 

PARTICIPANT

 

Name of Participant:Robert J. Barnard

 

/s/ Robert J. Barnard

 

(Signature)

 

 

 

By:Robert J. Barnard

 

 

Its:Vice President, Federated Global Investment Management, as attorney-in-fact
for Federated Kaufmann Funds II, a portfolio of Federated Insurance Series

 

Address for Notice and Delivery:

 

Tax ID No.:

 

Telephone:

 

Fax/email:

 

Attention:

 

Total Subscription Amount for both Initial Closing and assumed Second Closing:
249,998.89

 

Number of Shares Subscribed for in the Initial Closing: 51,203

 

Number of Warrant Shares issuable upon exercise of Warrant Subscribed for in the
Initial Closing: 51,203

 

Aggregate Purchase Price in the Initial Closing (No. of shares subscribed for in
the Initial Closing multiplied by per share purchase price plus no. of warrant
shares underlying warrant subscribed for in the Initial Closing multiplied by
$0.125): $166,665.77

 

The number of Shares to be subscribed for and the aggregate purchase price to be
paid in the Second Closing shall be determined pursuant to Section 2 of the
Agreement.

 

The Company has accepted this subscription this 29th day of July 2016.

 

 

“COMPANY”

 

 

 

STEADYMED LTD.,

 

an Israeli incorporated company

 

 

 

 

 

By: /s/ Jonathan Rigby

 

Jonathan Rigby, President & CEO

 

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

 

Subject to acceptance by the Company, the undersigned has completed this
Agreement to evidence his/her subscription for participation in the Offering of
Shares and Warrants of the Company, this 29th day of July, 2016.

 

PARTICIPANT

 

Name of Participant:Brown Bear Holdings LP

 

/s/ Brian J. Stark

 

(Signature)

 

 

 

By:Hbrian J. Stark

 

 

 

Its:Manager of its Manager

 

 

Address for Notice and Delivery:

 

Tax ID No.:

 

Telephone:

 

Fax/email:

 

Attention:

 

Total Subscription Amount for both Initial Closing and assumed Second Closing:
$1,813,238.02

 

Number of Shares Subscribed for in the Initial Closing: 371,375

 

Number of Warrant Shares issuable upon exercise of Warrant Subscribed for in the
Initial Closing 371,375

 

Aggregate Purchase Price in the Initial Closing (No. of shares subscribed for in
the Initial Closing multiplied by per share purchase price plus no. of warrant
shares underlying warrant subscribed for in the Initial Closing multiplied by
$0.125): $1,208,825.63

 

The number of Shares to be subscribed for and the aggregate purchase price to be
paid in the Second Closing shall be determined pursuant to Section 2 of the
Agreement.

 

The Company has accepted this subscription this 29th day of July 2016.

 

 

“COMPANY”

 

 

 

STEADYMED LTD.,

 

an Israeli incorporated company

 

 

 

By: /s/ Jonathan Rigby

 

Jonathan Rigby, President & CEO

 

 

 

Address: 2603 Camino Ramon, Suite 350

 

San Ramon, CA 94583

 

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

 

Subject to acceptance by the Company, the undersigned has completed this
Agreement to evidence his/her subscription for participation in the Offering of
Shares and Warrants of the Company, this 29th day of July, 2016.

 

PARTICIPANT

 

Name of Participant:Brian J. Stark

 

/s/ Brian J. Stark

 

(Signature)

 

By:Hans P. Utsch

 

Its:Self

 

Address for Notice and Delivery:

 

 

Tax ID No.:

 

Telephone:

 

Fax/email:

 

Attention:

 

Total Subscription Amount for both Initial Closing and assumed Second Closing:
$4,586,758.63

 

Number of Shares Subscribed for in the Initial Closing: 939,428

 

Number of Warrant Shares issuable upon exercise of Warrant Subscribed for in the
Initial Closing: 939,428

 

Aggregate Purchase Price in the Initial Closing (No. of shares subscribed for in
the Initial Closing multiplied by per share purchase price plus no. of warrant
shares underlying warrant subscribed for in the Initial Closing multiplied by
$0.125): $3,057,838.14.

 

The number of Shares to be subscribed for and the aggregate purchase price to be
paid in the Second Closing shall be determined pursuant to Section 2 of the
Agreement.

 

The Company has accepted this subscription this 29th day of July 2016.

 

 

“COMPANY”

 

 

 

STEADYMED LTD.,

 

an Israeli incorporated company

 

 

 

 

 

By:

/s/ Jonathan Rigby

 

 

Jonathan Rigby, President & CEO

 

 

 

Address: 2603 Camino Ramon, Suite 350

 

 San Ramon, CA 94583

 

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

 

EXHIBIT A

 

FORM OF WARRANT

 

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

 

THIS WARRANT AND THE SECURITIES PURCHASABLE HEREUNDER HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, OFFERED FOR
SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT FILED UNDER SAID ACT AND ANY APPLICABLE STATE SECURITIES LAWS, UNLESS
AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE.

 

STEADYMED LTD.

 

WARRANT

 

dated as of August [·], 2016

 

THIS CERTIFIES THAT, for value received, [·] or its successors or permitted
assigns (such Person and such successors and assigns each being the “Warrant
Holder” with respect to the Warrant held by it), at any time and from time to
time on any Business Day on or prior to 5:00 p.m. (New York City time), on the
Expiration Date (as herein defined), is entitled (a) to subscribe for the
purchase from SteadyMed Ltd., an Israeli incorporated company (the “Company”),
[·] Shares at a price per Share equal to the Exercise Price (as herein defined),
and (b) to the other rights set forth herein; provided that the number of Shares
issuable upon any exercise of this Warrant and the Exercise Price shall be
adjusted and readjusted from time to time in accordance with Section 5; and
provided further that the number of Shares issuable upon any exercise of this
Warrant are subject to certain limitations in accordance with Section 2(a). By
accepting delivery hereof, the Warrant Holder agrees to be bound by the
provisions hereof.

 

IN FURTHERANCE THEREOF, the Company irrevocably undertakes and agrees for the
benefit of the Warrant Holder as follows:

 

Section 1.                                           Definitions and
Construction.

 

(a)                                 Certain Definitions. As used herein (the
following definitions being applicable in both singular and plural forms):

 

“Affiliate” means, with respect to any Person, any other Person that directly or
indirectly controls, is controlled by, or is under common control with such
Person.

 

“Appraised Value” means at any time the fair market value thereof determined in
good faith by the Board of Directors of the Company as of a date which is within
ten (10) days of the date as of which the determination is to be made, subject
to the rights of the Requisite Holders pursuant to Section 5(n).

 

“Business Day” means any day except a Saturday, Sunday or other day on which
commercial banks in New York City are authorized by law to close.

 

“Closing Price” means, for any trading day with respect to a Share, (a) the last
reported sale price on such day on the principal national securities exchange on
which the Shares are listed or admitted to trading or, if no such reported sale
takes place on any such day, the average of the closing bid and asked prices
thereon, as reported in The Wall Street Journal, or (b) if such Shares shall not
be listed or admitted to trading on a national securities exchange, the last
reported sales price on the NASDAQ National Market System or, if no such
reported sale takes place on any such day, the average of the closing bid and
asked prices thereon, as reported in The Wall Street Journal, or (c) if such
Shares shall not be quoted on such National Market System nor listed or admitted
to trading on a national securities exchange, then the average of the closing
bid and asked prices, as reported by The Wall Street Journal for the

 

1

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

 

over-the-counter market; provided that if clause (a), (b), or (c) applies and no
price is reported in The Wall Street Journal for any trading day, then the price
reported in The Wall Street Journal for the most recent prior trading day shall
be deemed to be the price reported for such trading day. The Closing Price with
respect to a Share shall be adjusted for any stock dividend, stock split, stock
combination or other similar transaction during the applicable calculation
period.

 

“Commission” means the Securities and Exchange Commission or any other Federal
agency administering the Securities Act at the time.

 

“Exchange Act” means the Securities Exchange Act of 1934, or any successor
Federal statute, and the rules and regulations of the Commission thereunder, all
as the same shall be in effect at the time.

 

“Exercise Amount” means for any number of Warrant Shares as to which this
Warrant is being exercised the product of (i) such number of Warrant Shares
times (ii) the Exercise Price.

 

“Exercise Price” means $3.5995 per Warrant Share, as adjusted from time to time
pursuant to Section 5.

 

“Expiration Date” means August 2, 2021.

 

“Initial Holder” means [·].

 

“Market Price” on any day means (a) the unweighted average of the daily Closing
Prices per Share for the twenty (20) consecutive trading days prior to such date
or (b) if clauses (a), (b) and (c) of the definition of “Closing Price” are
inapplicable, then the Appraised Value as of such day shall apply; provided that
for purposes of the application of Section 5(b) to a Share Distribution pursuant
to a public offering registered under the Securities Act, “Market Price” means
the Closing Price per Share for the trading day preceding the effective date of
the registration statement with respect to such public offering (or in the case
of an initial public offering, the price per Share in such offering); and
provided further that that for purposes of the application of Section 5(b) to a
Share Distribution consisting solely of equity awards and options under the
Company’s board and shareholder approved equity incentive plans, “Market Price”
means the Closing Price per Share for the date of such grant.

 

“Person” means an individual, a corporation, a partnership, an association, a
trust or any other entity or organization, including a government or political
subdivision or an agency or instrumentality thereof.

 

“Requisite Holders” means at any time holders of Warrant Shares and Warrants
representing at least a majority of the Warrant Shares outstanding or issuable
upon the exercise of all the outstanding Warrants.

 

“Securities Act” means the Securities Act of 1933, as amended, or any successor
Federal statute, and the rules and regulations of the Commission thereunder, all
as the same shall be in effect at the time.

 

“Shares” means the Company’s currently authorized common stock, New Israeli
Shekels 0.01 par value, and stock of any other class or other consideration into
which such currently authorized capital stock may hereafter have been changed.

 

“Warrant” means, as the context requires, this warrant and any successor warrant
or warrants issued upon a whole or partial transfer or assignment of any such
Share purchase warrant or of any such successor warrant.

 

2

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

 

“Warrant Shares” means the number of Shares issued or issuable upon exercise of
this Warrant as set forth in the introduction hereto, as adjusted from time to
time pursuant to Section 5, or in the case of other Warrants, issuable upon
exercise of those Warrants.

 

(b)                                 Accounting Terms and Determinations. Unless
otherwise specified herein, all accounting terms used herein shall be
interpreted, all accounting determinations hereunder shall be made, and all
financial statements required to be delivered hereunder shall be prepared, in
accordance with generally accepted accounting principles. When used herein, the
term “financial statements” shall include the notes and schedules thereto.
References to fiscal periods are to fiscal periods of the Company.

 

(c)                                  Computation of Time Periods. With respect
to the computation of periods of time from a specified date to a later specified
date, the word “from” means “from and including” and the words “to” and “until”
each mean “to but excluding.” Periods of days shall be counted in calendar days
unless otherwise stated.

 

(d)                                 Construction. Unless the context requires
otherwise, references to the plural include the singular and to the singular
include the plural, references to any gender include any other gender, the part
includes the whole, the term “including” is not limiting, and the term “or” has,
except where otherwise indicated, the inclusive meaning represented by the
phrase “and/or.” The words “hereof,” “herein,” “hereby,” “hereunder,” and
similar terms in this Warrant refer to this Warrant as a whole and not to any
particular provision of this Warrant. Section, subsection, clause, exhibit and
schedule references are to this Warrant, unless otherwise specified. Any
reference to this Warrant includes any and all permitted alterations,
amendments, changes, extensions, modifications, renewals, or supplements thereto
or thereof, as applicable.

 

(e)                                  Exhibits and Schedules. All of the exhibits
and schedules attached hereto shall be deemed incorporated herein by reference.

 

(f)                                   No Presumption Against Any Party. Neither
this Warrant nor any uncertainty or ambiguity herein or therein shall be
construed or resolved using any presumption against any party hereto or thereto,
whether under any rule of construction or otherwise. On the contrary, this
Warrant has been reviewed by each of the parties and their counsel and, in the
case of any ambiguity or uncertainty, shall be construed and interpreted
according to the ordinary meaning of the words used so as to fairly accomplish
the purposes and intentions of all parties hereto.

 

Section 2.                                           Exercise of Warrant.

 

(a)                                 Exercise Requirements.

 

(i)                                     Notice of Exercise and Payment. The
Warrant Holder may exercise this Warrant in whole or in part, at any time or
from time to time on any Business Day on or prior to the Expiration Date, by
delivering to the Company a duly executed notice (a “Notice of Exercise”) in the
form of Exhibit A and by payment to the Company of the Exercise Price per
Warrant Share, at the election of the Warrant Holder, either (a) by wire
transfer of immediately available funds to the account of the Company in an
amount equal to the Exercise Amount, (b) by receiving from the Company the
number of Warrant Shares equal to (i) the number of Warrant Shares as to which
this Warrant is being exercised minus (ii) the number of Warrant Shares having a
value, based on the Closing Price on the trading day immediately prior to the
date of such exercise (or if there is no such Closing Price, then based on the
Appraised Value as of such day), equal to the Exercise Amount, or (c) any
combination of the foregoing. The Company acknowledges that the provisions of
clause (b) are intended, in part, to ensure that a full or partial exchange of
this Warrant pursuant to such clause (b) will qualify as a conversion, within
the meaning of paragraph (d)(3)(iii) of Rule 144 under the Securities Act, and
the holding period for the

 

3

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

 

Warrant Shares shall be deemed to have commenced on the date this Warrant was
originally issued to the Warrant Holder. At the request of any Holder, the
Company will accept reasonable modifications to the exchange procedures provided
for in this Section in order to accomplish such intent. For all purposes of this
Warrant (other than this Section 2(a)(i)), any reference herein to the exercise
of this Warrant shall be deemed to include a reference to the exchange of this
Warrant into Shares in accordance with the terms of clause (b).

 

(ii)                                  Limitations on Exercise. Notwithstanding
any provisions herein to the contrary, the Holder shall not be entitled to
exercise this Warrant for a number of Warrant Shares in excess of that number of
Warrant Shares which, upon giving effect to such exercise, would cause the
aggregate number of Company’s securities beneficially owned by the Holder to
exceed 24.9% or 44.9% of the outstanding share capital of the Company following
such exercise (excluding, for the avoidance of doubt, any shares such Holder may
be deemed to beneficially own by reason of holding any Warrants that have not
yet been exercised and are not proposed to be exercised at such time of
determination)(the “Cap”). The limitation described in the previous sentence
(i) will only apply to the extent that exceeding the Cap will trigger a
shareholder vote or regulatory approval under Israeli law, but only to the
extent that no such shareholder vote or regulatory approval has already been
obtained and (ii) will not apply in the event the Company has publicly disclosed
that it intends to effect a Corporate Reorganization. Except as set forth in the
preceding sentence, for purposes of this Section, beneficial ownership shall be
calculated in accordance with Section 13(d) of the Exchange Act, and “group”
shall have the meaning set forth in Section 13(d) of the Exchange Act (any such
persons or entities with whom the Warrant Holder shall constitute a “group” with
respect to the Shares, collectively, the “Attributable Parties”).
Notwithstanding the foregoing, to the extent the Cap applies, the determination
of whether this Warrant is exercisable (in relation to other securities owned by
such Holder) and of which portion of this Warrant is exercisable shall be in the
sole discretion of Company. For purposes of determining the number of
outstanding Shares the Warrant Holder may acquire upon the exercise of this
Warrant without exceeding the Cap, the Warrant Holder may rely on the number of
outstanding Shares as reflected in (x) the Company’s most recent Annual Report
on Form 10-K, Quarterly Report on Form 10-Q, Current Report on Form 8-K or other
public filing with the Commission, as the case may be, (y) a more recent public
announcement by the Company or (z) any other written notice by the Company, if
any, setting forth the number of Shares outstanding (the “Reported Outstanding
Share Number”). For purposes of the foregoing, the aggregate number of Shares
beneficially owned by the Warrant Holder and the other Attributable Parties
shall include the number of Shares held by the Warrant Holder and all other
Attributable Parties plus the number of Shares issuable upon exercise of this
Warrant with respect to which the determination of such sentence is being made,
but shall exclude Shares which would be issuable upon (A) exercise of the
remaining, unexercised portion of this Warrant beneficially owned by the Warrant
Holder or any of the other Attributable Parties and (B) exercise or conversion
of the unexercised or unconverted portion of any other securities of the Company
(including, without limitation, any convertible notes or convertible preferred
stock or warrants, including other Warrants) beneficially owned by the Warrant
Holder or any other Attributable Party subject to a limitation on conversion or
exercise analogous to the limitation contained in this clause (ii). In any case,
the number of outstanding Shares shall be determined after giving effect to the
conversion or exercise of securities of the Company, including this Warrant, by
the Warrant Holder and any other Attributable Party since the date as of which
the Reported Outstanding Share Number was reported. Upon the written request of
the Holder, the Company shall within three trading days confirm in writing
(including by electronic mail) to the Holder: (i) the number of Company’s Shares
then outstanding, (ii) the Company’s determination of the attainment of the Cap,
and (iii) the limitation to exercise hereunder, with respect to which portion of
the Warrant is exercisable pursuant to this provision. Any number of Warrant
Shares that may not be exercisable because of this Section 2(a)(ii) shall be
exercisable at such other time when the exercise thereof shall not cause the
number Company’s securities beneficially owned by the Holder to exceed the Cap
in accordance with this Section 2(a)(ii); provided that such exercise is before
the Expiration Date.

 

4

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

 

(b)                                 Effectiveness and Delivery. The Company
shall in accordance with such Notice of Exercise, (i) as soon as practicable but
not later than three Business Days after the Company shall have received such
Notice of Exercise and payment, execute an electronic delivery of the Warrant
Shares to the Holder’s account at the Depository Trust Company (“DTC”) or a
similar organization, or (ii) as soon as practicable but not later than five
Business Days after the Company shall have received such Notice of Exercise and
payment, execute and deliver or cause to be executed and delivered a certificate
or certificates representing, the number of Shares specified in such Notice of
Exercise, free of restrictive legends, issued in the name of the Warrant Holder
or in such other name or names of any Person or Persons designated in such
Notice of Exercise, unless in the case of clause (i) and (ii) a registration
statement covering the resale of the Warrant Shares and naming the Holder as a
selling stockholder thereunder is not then effective or the Shares are not
freely transferable without volume and manner of sale restrictions pursuant to
Rule 144 under the Securities Act, in which case the Company shall record, in
book entry, the Shares issuable upon such exercise with appropriate restrictive
legend. If the Warrant Shares are to be issued free of all restrictive legends,
the Company shall, upon the written request of the Warrant Holder, use its
reasonable best efforts to deliver, or cause to be delivered, Warrant Shares
hereunder electronically through DTC or another established clearing corporation
performing similar functions, if available. This Warrant shall be deemed to have
been exercised and such Share certificate or certificates, or such book entry or
book entries, shall be deemed to have been issued, and the Warrant Holder or
other Person or Persons designated in such Notice of Exercise shall be deemed
for all purposes to have become a holder of record of Shares, all as of the date
that such Notice of Exercise and payment shall have been received by the
Company. To the maximum extent permitted by law, the Company’s obligations to
issue and deliver Warrant Shares in accordance with and subject to the terms
hereof are not conditioned upon or impaired by any action or inaction by the
Warrant Holder to enforce the same, any waiver or consent with respect to any
provision hereof, the recovery of any judgment against any Person or any action
to enforce the same, or any setoff, counterclaim, recoupment, limitation or
termination, or any breach or alleged breach by the Warrant Holder or any other
Person of any obligation to the Company or any violation or alleged violation of
law by the Warrant Holder or any other Person, and irrespective of any other
circumstance that might otherwise limit such obligation of the Company to the
Warrant Holder in connection with the issuance of Warrant Shares. Nothing herein
shall limit the Warrant Holder’s right to pursue any other remedies available to
it hereunder, at law or in equity including, without limitation, a decree of
specific performance and/or injunctive relief with respect to the Company’s
failure to timely deliver certificates, or record book entries, representing the
Warrant Shares issuable upon exercise of the Warrant as required pursuant to the
terms hereof.

 

(c)                                  Surrender of Warrant. The Warrant Holder
shall surrender this Warrant to the Company when it delivers the Notice of
Exercise, and in the event of a partial exercise of the Warrant, the Company
shall execute and deliver to the Warrant Holder, at the time the Company
delivers the Share certificate or certificates, or records a book entry or book
entries, for Shares issued pursuant to such Notice of Exercise, a new Warrant
for the unexercised portion of the Warrant, but in all other respects identical
to this Warrant.

 

(d)                                 Legend. Each certificate or book entry for
Warrant Shares issued upon exercise of this Warrant, unless at the time of
exercise such Warrant Shares are registered under the Securities Act, shall bear
the following legend:

 

THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, AND MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FILED UNDER SAID ACT AND ANY
APPLICABLE STATE SECURITIES LAWS, UNLESS AN EXEMPTION FROM SUCH REGISTRATION IS
AVAILABLE.

 

5

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

 

Any certificate or book entry for Warrant Shares issued at any time in exchange
or substitution for any Shares, a certificate or book entry for which bears such
legend (unless at that time such Warrant Shares are registered under the
Securities Act), shall also bear such legend unless, in the written opinion of
counsel selected by the holder of such certificate or book entry (who may be an
employee of such holder), which counsel and opinion shall be reasonably
acceptable to the Company, the Warrant Shares represented thereby need no longer
be subject to restrictions on resale under the Securities Act.

 

(e)                                  Fractional Shares. The Company shall not be
required to issue fractions of Shares upon an exercise of the Warrant. If any
fraction of a Share would, but for this restriction, be issuable upon an
exercise of the Warrant, in lieu of delivering such fractional Share, the
Company shall pay to the Warrant Holder, in cash, an amount equal to the same
fraction times the Closing Price on the trading day immediately prior to the
date of such exercise (or if there is no such Closing Price, then based on the
Appraised Value as of such day).

 

(f)                                   Expenses and Taxes. The Company shall pay
all expenses, taxes and owner charges payable in connection with the
preparation, issuance and delivery of certificates or recordation of book
entries for the Warrant Shares and any new Warrants, except that if the
certificates or book entries for the Warrant Shares or the new Warrants are to
be registered in a name or names other than the name of the Warrant Holder,
funds sufficient to pay all transfer taxes payable as a result of such transfer,
shall be paid by the Warrant Holder at the time of its delivery of the Notice of
Exercise or promptly upon receipt of a written request by the Company for
payment.

 

(g)                                  Automatic Cashless Exercise. To the extent
that there has not been an exercise by the Warrant Holder pursuant to
Section 2(a) hereof, any portion of the Warrant that remains unexercised shall
be exercised automatically in whole (not in part), upon the Expiration Date.
Payment by the Warrant Holder upon such automatic exercise shall be in the form
of the Warrant Holder receiving from the Company the number of Warrant Shares
equal to (i) the number of Warrant Shares as to which this Warrant is being
automatically exercised minus (ii) the number of Warrant Shares having a value,
based on the Closing Price on the trading day immediately prior to the date of
such automatic exercise (or if there is no such Closing Price, then based on the
Appraised Value as of such day), equal to the Exercise Amount.

 

(h)                                 Buy-In. If by the close of the third
(3rd) Business Day after delivery of a Notice of Exercise and the payment of the
aggregate exercise price for all or any part of this Warrant, the Company fails
to deliver to the Warrant Holder a book entry record, under the name of the
Warrant Holder, representing the required number of Warrant Shares in the manner
required pursuant to Section 2(b), and if after such third (3rd) Business Day
and prior to the receipt of such Warrant Shares, the Warrant Holder purchases
(in an open market transaction or otherwise) Shares to deliver in satisfaction
of a sale by the Warrant Holder of the Warrant Shares which the Warrant Holder
anticipated receiving upon such exercise (a “Buy-In”), then the Company shall,
within three (3) Business Days after the Warrant Holder’s request and in the
Warrant Holder’s sole discretion, either (1) pay in cash to the Warrant Holder
an amount equal to the Warrant Holder’s total purchase price (including
brokerage commissions, if any) for the Shares so purchased, at which point the
Company’s obligation to deliver such certificate or record such book entry (and
to issue such Warrant Shares) shall terminate or (2) promptly honor its
obligation to deliver to the Warrant Holder a book entry record, under the name
of the Warrant Holder, representing such Warrant Shares and pay cash to the
Warrant Holder in an amount equal to the excess (if any) of the Warrant Holder’s
total purchase price (including brokerage commissions, if any) for the Shares so
purchased in the Buy-In over the product of (A) the number of Shares purchased
in the Buy-In, times (B) the Closing Price of a Share on the Exercise Date.

 

6

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

 

Section 3.                                           Investment Representation.
By accepting the Warrant, the Warrant Holder represents that it is acquiring the
Warrant for its own account for investment purposes and not with the view to any
sale or distribution, that the Warrant Holder will not offer, sell or otherwise
dispose of the Warrant or the Warrant Shares except under circumstances as will
not result in a violation of applicable securities laws, and that the Warrant
Holder is an “accredited investor” as that term is defined in Rule 501 under the
Securities Act.

 

Section 4.                                           Validity of Warrant and
Issuance of Shares.

 

(a)                                 The Company represents and warrants that
this Warrant has been duly authorized, is validly issued, and constitutes the
valid and binding obligation of the Company.

 

(b)                                 The Company further represents and warrants
that on the date hereof it is duly authorized and reserved, and the Company
hereby agrees that it will at all times until the Expiration Date have duly
authorized and reserved, such number of Shares as will be sufficient to permit
the exercise in full of the Warrant, and that all such Shares are and will be
duly authorized and, when issued upon exercise of the Warrant, will be validly
issued, fully paid and non-assessable, and free and clear of all security
interests, claims, liens, equities and other encumbrances.

 

Section 5.                                           Antidilution Provisions.
The Exercise Price in effect at any time, and the number of Warrant Shares that
may be purchased upon any exercise of the Warrant, shall be subject to change or
adjustment as follows:

 

(a)                                 Share Reorganization. If the Company shall
subdivide its outstanding Shares into a greater number of Shares, by way of a
stock split, stock dividend or otherwise, or consolidate its outstanding Shares
into a smaller number of Shares (any such event being herein called a “Share
Reorganization”), then (i) the Exercise Price shall be adjusted, effective
immediately after the effective date of such Share Reorganization, to a price
determined by multiplying the Exercise Price in effect immediately prior to such
effective date by a fraction, the numerator of which shall be the number of
Shares outstanding on such effective date before giving effect to such Share
Reorganization and the denominator of which shall be the number of Shares
outstanding after giving effect to such Share Reorganization, and (ii) the
number of Shares subject to purchase upon exercise of this Warrant shall be
adjusted, effective at such time, to a number determined by multiplying the
number of Shares subject to purchase immediately before such Share
Reorganization by a fraction, the numerator of which shall be the number of
Shares outstanding after giving effect to such Share Reorganization and the
denominator of which shall be the number of Shares outstanding immediately
before giving effect to such Share Reorganization.

 

(b)                                 Share Distribution.

 

(i)                                     If the Company shall issue, sell or
otherwise distribute any Shares (including, for the avoidance of doubt, any
deemed issuance, sale or distribution described in paragraphs (ii) and
(iii) below), other than pursuant to a Share Reorganization (which is governed
by Section 5(a)) (any such event, including any event described in
paragraphs (ii) and (iii) below, being herein called a “Share Distribution”),
for a consideration per Share less than (x) the Market Price immediately prior
to such Share Distribution or (y) the Exercise Price then in effect, then,
effective upon such Share Distribution, the Exercise Price shall be reduced to a
price determined by multiplying the Exercise Price by a fraction, the numerator
of which shall be the sum of (A) the number of Shares outstanding immediately
prior to such Share Distribution multiplied by the higher of such Market Price
and the Exercise Price, plus (B) the consideration, if any, received by the
Company upon such Share Distribution, and the denominator of which shall be the
product of (1) the total number of Shares outstanding immediately after such
Share Distribution multiplied by (2) the higher of such Market Price and the
Exercise Price. If any Share

 

7

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

 

Distribution shall require an adjustment to the Exercise Price pursuant to the
foregoing provisions of this Section 5(b), including by operation of
paragraph (ii) or (iii) below, then, effective at the time such adjustment is
made, the number of Shares subject to purchase upon exercise of this Warrant
shall be increased to a number determined by multiplying the number of Shares
subject to purchase immediately before such Share Distribution by a fraction,
the numerator of which shall be the Exercise Price in effect immediately prior
to such event and the denominator of which shall be the Exercise Price as
adjusted in accordance with this Section 5(b). The provisions of this
Section 5(b), including by operation of paragraph (ii) or (iii) below, shall not
operate to increase the Exercise Price or reduce the number of Shares subject to
purchase upon exercise of this Warrant.

 

(ii)                                  If the Company shall issue, sell,
distribute or otherwise grant in any manner (including by assumption) any rights
to subscribe for or to purchase, or any warrants or options for the purchase of
Shares or any securities convertible into or exchangeable for Shares (such
rights, warrants or options being herein called “Options” and such convertible
or exchangeable securities being herein called “Convertible Securities”),
whether or not such Options or the rights to convert or exchange any such
Convertible Securities in respect of such Options are immediately exercisable or
exercisable prior to the Expiration Date or thereafter, and the price per Share
for which Shares are issuable upon the exercise of such Options or upon
conversion or exchange of such Convertible Securities in respect of such Options
(determined by dividing (x) the aggregate amount, if any, received or receivable
by the Company as consideration for the granting of such Options, plus the
minimum aggregate amount of additional consideration payable to the Company upon
the exercise of all such Options, plus, in the case of Options to acquire
Convertible Securities, the minimum aggregate amount of additional
consideration, if any, payable upon issuance or sale of such Convertible
Securities and upon the conversion or exchange thereof, by (y) the total maximum
number of Shares issuable upon the exercise of such Options or upon the
conversion or exchange of all such Convertible Securities issuable upon the
exercise of such Options) shall be less than (A) the Market Price immediately
prior to the granting of such Options or (B) the Exercise Price, then, for
purposes of Section 5(b)(i), the total maximum number of Shares issuable upon
the exercise of such Options or upon conversion or exchange of the total maximum
amount of such Convertible Securities issuable upon the exercise of such Options
shall be deemed to have been issued as of the date of granting of such Options
and thereafter shall be deemed to be outstanding and the Company shall be deemed
to have received as consideration of such price per Share, determined as
provided above, therefor. Except as otherwise provided in paragraph (iv) below,
no additional adjustment of the Exercise Price shall be made upon the actual
exercise of such Options or upon conversion or exchange of such Convertible
Securities.

 

(iii)                               If the Company shall issue, sell or
otherwise distribute (including by assumption) any Convertible Securities,
whether or not the rights to exchange or convert thereunder are immediately
exercisable or exercisable prior to the Expiration Date or thereafter, and the
price per Share for which Shares are issuable upon the conversion or exchange of
such Convertible Securities (determined by dividing (x) the aggregate amount
received or receivable by the Company as consideration for the issuance, sale or
distribution of such Convertible Securities, plus the minimum aggregate amount
of additional consideration, if any, payable to the Company upon the conversion
or exchange thereof, by (y) the maximum number of Shares issuable upon the
conversion or exchange of all such Convertible Securities) shall be less than
(A) the Market Price immediately prior to such issuance, sale or distribution or
(B) the Exercise Price, then, for purposes of Section 5(b)(i), the total maximum
number of Shares issuable upon conversion or exchange of all such Convertible
Securities shall be deemed to have been issued as of the date of the issuance,
sale or distribution of such Convertible Securities thereafter shall be deemed
to be outstanding and the Company shall be deemed to have received as
consideration such price per Share, determined as provided above, therefor.
Except as otherwise provided in paragraph (iv) below, no additional adjustment
of the Exercise Price shall be made upon the actual conversion or exchange of
such Convertible Securities.

 

8

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

 

(iv)                              If (x) the purchase price provided for in any
Option referred to in Section 5(b)(ii) or the additional consideration, if any,
payable upon the conversion or exchange of any Convertible Securities referred
to in Sections 5 (b)(ii) or 5(b)(iii) or the rate at which any Convertible
Securities referred to in Sections 5(b)(ii) or 5(b)(iii) are convertible into or
exchangeable for Shares shall change at any time (other than under or by reason
of provisions designed to protect against dilution upon an event which results
in a related adjustment pursuant to this Section 5), or (y) any of such Options
or Convertible Securities shall have terminated, lapsed or expired, the Exercise
Price then in effect shall forthwith be readjusted (effective only with respect
to any exercise of this Warrant after such readjustment) to the Exercise Price
which would then be in effect had the adjustment made upon the issuance, sale,
distribution or grant of such Options or Convertible Securities been made based
upon such changed purchase price, additional consideration or conversion rate,
as the case may be (in the case of any event referred to in clause (x) of this
paragraph (iv)) or had such adjustment not been made (in the case of any event
referred to in clause (y) of this paragraph (iv)).

 

(v)                                 If the Company shall pay a dividend or make
any other distribution upon any capital stock of the Company payable in Shares,
Options or Convertible Securities, other than pursuant to a Share Reorganization
(which is governed by Section 5(a)), then, for purposes of this Section 5(b),
such Shares, Options or Convertible Securities shall be deemed to have been
issued or sold without consideration.

 

(vi)                              If any Shares, Options or Convertible
Securities shall be issued, sold or distributed for cash, the consideration
received therefor shall be deemed to be the amount received by the Company
therefore, less any expenses in excess of reasonable and customary expenses in
connection therewith. If any Shares, Options or Convertible Securities shall be
issued, sold or distributed for a consideration other than cash, the amount of
the consideration other than cash received by the Company shall be deemed to be
the fair market value of such consideration at the time of its receipt by the
Company as determined in good faith by the Board of Directors of the Company,
less any expenses in excess of reasonable and customary expenses incurred in
connection therewith. If any Shares, Options or Convertible Securities shall be
issued in connection with any merger in which the Company is the surviving
entity, the amount of consideration therefore shall be deemed to be the fair
market value of such portion of the assets and business of the non-surviving
entity as shall be attributable to such Shares, Options or Convertible
Securities, as the case may be, at the time of the merger as determined in good
faith by the Board of Directors of the Company (in making such determination the
members of its Board of Directors may give effect to the proposed acquisition
and incorporate the prospects of the performance of the assets and business of
the non-surviving corporation over the twelve (12) month period following the
acquisition, including any reasonably demonstrate synergistic or value enhancing
factors). If any Options shall be issued in connection with the issuance and
sale of other securities of the Company, together comprising one integral
transaction in which no specific consideration is allocated to such Options by
the parties thereto, such Options shall be deemed to have been issued without
consideration.

 

(c)                                  Special Distributions; Above Market
Purchases of Securities.

 

(i)                                     If the Company shall issue or distribute
to any holder or holders of Shares evidences of indebtedness, any other
securities of the Company or any cash, property or other assets (excluding (i) a
Share Reorganization and (ii) a Share Distribution), whether or not accompanied
by a purchase, redemption or other acquisition of Shares (any such nonexcluded
event being herein called a “Special Distribution”), then the Warrant Holder
shall be entitled to a pro-rata Share of such Special Distribution as though the
Warrant Holder had fully exercised this Warrant immediately prior to the record
date for such Special Distribution, and the Company shall pay or distribute such
pro-rata share to the Warrant Holder when paid or distributed to the holders of
the Shares, or the Warrant Holder may at its option decline to accept such
payment or distribution in which case the (x) the Exercise Price shall be

 

9

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

 

decreased, effective immediately after the effective date of such Special
Distribution, to a price determined by multiplying the Exercise Price then in
effect by a fraction, the numerator of which shall be the Market Price
immediately prior to such effective date less any cash and the then fair market
value, as determined in good faith by the Board of Directors of the Company, of
any evidences of indebtedness, securities or property or other assets issued or
distributed in such Special Distribution with respect to one Share, and the
denominator of which shall be the Market Price immediately prior to such
effective date, and (y) the number of Shares subject to purchase upon exercise
of this Warrant shall be increased to a number determined by multiplying the
number of Shares subject to purchase immediately before such Special
Distribution by a fraction, the numerator of which shall be the Exercise Price
in effect immediately before such Special Distribution and the denominator of
which shall be the Exercise Price in effect immediately after such Special
Distribution. A reclassification of the Shares (other than a change in par
value, or from par value to no par value or from no par value to par value) into
shares of any other class of stock shall be deemed to be a distribution by the
Company to the holders of its Shares of such class of stock and, if the
outstanding Shares shall be changed into a larger or smaller number of Shares as
part of such reclassification, a Share Reorganization.

 

(ii)                                  If, at any time after the date hereof, the
Company or any Subsidiary shall repurchase (a “Repurchase”), by self-tender
offer or otherwise, any securities of the Company at an aggregate repurchase
price that exceeds the aggregate Market Price for the securities repurchased
determined as of the Business Day immediately prior to the earliest of (i) the
date of such Repurchase, (ii) the commencement of an offer to repurchase or
(iii) the public announcement of either (such date being referred to as the
“Determination Date”), then the Exercise Price and the number of Warrant Shares
issuable upon exercise of this Warrant shall be adjusted as follows:

 

(A)                               The Exercise Price shall be reduced to an
amount equal to the product of (A) the Exercise Price in effect immediately
prior to such issuance or sale times (B) a fraction, (I) the numerator of which
shall be (x) the product of (1) the Market Price for the Shares as of the
Determination Date times (2) the number of Shares outstanding immediately
following the consummation of the Repurchase less (y) the Repurchase Premium (as
defined below), and (II) the denominator of which shall be (x) the product of
(1) the Market Price for the Shares as of the Determination Date times (2) the
number of Shares outstanding immediately following the consummation of the
Repurchase.

 

(B)                               The number of Warrant Shares issuable upon
exercise of this Warrant shall be increased to the number of Shares determined
by multiplying (x) the number of Warrant Shares issuable upon exercise of this
Warrant immediately prior to such distribution times (y) a fraction (1) the
numerator of which shall be the Exercise Price in effect immediately prior to
the adjustment in clause (A) of this Section 5(c)(ii) and (2) the denominator of
which shall be the Exercise Price in effect immediately after such adjustment.

 

The amount by which the aggregate repurchase price for all securities
repurchased in any Repurchase (including for such purposes any fees or other
direct or indirect consideration payable in connection therewith) exceeds the
aggregate Market Price for such securities is referred to as the “Repurchase
Premium.”

 

(d)                                 Corporate Reorganization. Without limiting
any of the other provisions hereof, if any (i) capital reorganization;
(ii) reclassification of the capital stock of the Company or compulsory share
exchange pursuant to which the Shares are effectively converted into or
exchanged for other securities, cash or property; (iii) merger, consolidation,
reorganization or other similar transaction or series of related transactions
which results in the Shares of the Company outstanding immediately prior thereto
representing immediately thereafter (either by remaining outstanding or by being
converted into voting securities of the surviving or acquiring entity) less than
50% of the combined voting power and economic

 

10

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

 

interests in the Company or such surviving or acquiring entity outstanding
immediately after such transaction; (iv) sale, lease, license, transfer,
conveyance or other disposition of all or substantially all of the assets of the
Company and its subsidiaries taken as a whole; (v) sale of shares of capital
stock of the Company, in a single transaction or series of related transactions,
representing at least 35% of the voting power of the voting securities of or
economic interests in the Company; (vi) acquisition by any “person” (together
with his, her or its Affiliates) or “group” (within the meaning of
Section 13(d) or 14(d) of the Exchange Act), directly or indirectly, of the
beneficial ownership (as such term is defined in Rule 13d-3 promulgated under
the Exchange Act) of outstanding Shares and/or other equity securities of the
Company, in a single transaction or series of related transactions (including,
without limitation, one or more tender offers or exchange offers), representing
35% or more of the voting power of or economic interests in the then outstanding
shares of capital stock of the Company, (vii) tender offer or exchange offer
(whether by the Company or another Person) pursuant to which all or
substantially all of the holders of Shares are permitted to tender or exchange
their shares for other securities, cash or property (each of (i)-(vii) above a
“Corporate Reorganization”) shall be effected, then the Company shall use its
best efforts to ensure that lawful and adequate provision shall be made whereby
each Warrant Holder shall thereafter continue to have the right to purchase and
receive upon the basis and upon the terms and conditions herein specified and in
lieu of the Warrant Shares issuable upon exercise of the Warrants held by such
Warrant Holder (without regard to any limitations on exercise contained in such
Warrants), shares of voting stock in such successor entity, surviving entity or
entity purchasing or otherwise acquiring such assets in the Corporate
Reorganization (as the case may be, the “Acquirer”), such that the aggregate
value of the Warrant Holder’s warrants to purchase such number of shares of the
Acquirer (where the value of a warrant to purchase one share in the Acquirer is
determined in accordance with the Black-Scholes Option Pricing formula set forth
in Appendix (A) hereto) is equivalent to the aggregate value of the Warrants
held by such Warrant Holder (where the value of each Warrant to purchase one
share in the Company is determined in accordance with the Black-Scholes Option
Pricing formula set forth Appendix (B) hereto). Furthermore, the new warrants to
purchase shares in the Acquirer referred to herein shall have the same
expiration date as the Warrants, and shall have a strike price, KAcq, that is
calculated in accordance with Appendix (A) hereto. For the avoidance of doubt,
if the successor, surviving or acquiring entity, as the case may be, is a member
of a consolidated group for financial reporting purposes, the “Acquirer” shall
be deemed to be the parent of such consolidated group for purposes of this
Section 5(d) and Appendix (A) hereto.

 

Moreover, appropriate provision shall be made with respect to the rights and
interests of each Warrant Holder to the end that the provisions hereof
(including, without limitation, provision for adjustment of the Warrant Price)
shall thereafter be applicable, as nearly equivalent as may be practicable in
relation to any shares of stock thereafter deliverable upon the exercise
thereof. The Company shall not effect any such Corporate Reorganization unless
prior to or simultaneously with the consummation thereof the successor
corporation resulting from such consolidation or merger, or the corporation
purchasing or otherwise acquiring such assets or other appropriate corporation
or entity shall assume by written instrument, reasonably deemed by the Board of
Directors of the Company and the Requisite Holders to be satisfactory in form
and substance, the obligation to deliver to the holder of the Warrants, at the
last address of such holder appearing on the books of the Company, such shares
of stock, as, in accordance with the foregoing provisions, such holder may be
entitled to purchase, and the other obligations under these Warrants. The
provisions of this Section 5(d) shall similarly apply to successive Corporate
Reorganizations. Notwithstanding anything to the contrary hereunder, if the
Corporate Reorganization, is (1) a transaction where the consideration paid to
the holders of the Shares consists of cash, (2) a “Rule 13e-3 transaction” as
defined in Rule 13e-3 under the Securities Exchange Act of 1934, as amended, or
(3) a Corporate Reorganization involving a person or entity not traded on the
New York Stock Exchange, the NYSE Alternext (formerly the American Stock
Exchange), the NASDAQ Global Select Market, the NASDAQ Global Market or the
NASDAQ Capital Market, at the request of the Warrant Holder delivered before the
ninetieth (90th) day after such Corporate Reorganization, the

 

11

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

 

Company (or the Acquirer) shall purchase this Warrant from the Warrant Holder by
paying to the Warrant Holder, within five (5) Business Days after such request
(or, if later, on the effective date of the Corporate Reorganization), cash in
an amount equal to the aggregate value of this Warrant, where the value of each
Warrant to purchase one Warrant Share is calculated in accordance with the
Black-Scholes Option Pricing formula set forth in Appendix (B) hereto.

 

(e)                                  Adjustment Rules.

 

(i)                                     Any adjustments pursuant to this
Section 5 shall be made successively whenever any event referred to herein shall
occur, except that, notwithstanding any other provision of this Section 5, no
adjustment shall be made to the number of Warrant Shares to be delivered to the
Warrant Holder (or to the Exercise Price) if such adjustment represents less
than 1% of the number of Warrant Shares previously required to be so delivered,
but any lesser adjustment shall be carried forward and shall be made at the time
and together with the next subsequent adjustment which together with any
adjustments so carried forward shall amount to 1% or more of the number of
Warrant Shares to be so delivered.

 

(ii)                                  No adjustments shall be made pursuant to
this Section 5 in respect of the issuance of Warrant Shares upon exercise of the
Warrant;

 

(iii)                               If the Company shall take a record of the
holders of its Shares for any purpose referred to in this Section 5, then
(x) such record date shall be deemed to be the date of the issuance, sale,
distribution or grant in question and (y) if the Company shall legally abandon
such action prior to effecting such action, no adjustment shall be made pursuant
to this Section 5 in respect of such action.

 

(iv)                              In computing adjustments under this Section 5,
(A) fractional interests in Shares shall be taken into account to the nearest
one-thousandth of a Share, and (B) calculations of the Exercise Price shall be
carried to the nearest one-thousandth of one cent.

 

(v)                                 Notwithstanding anything herein to the
contrary, no adjustment pursuant to this Section 5 shall cause the aggregate
Exercise Price for all of the Warrant Shares to increase to more than $100.00.

 

(f)                                   Proceedings Prior to Any Action Requiring
Adjustment. As a condition precedent to the taking of any action which would
require an adjustment pursuant to this Section 5, the Company shall take any
action which may be necessary, including obtaining regulatory approvals or
exemptions, in order that the Company may thereafter validly and legally issue
as fully paid and nonassessable all Shares which the Warrant Holder is entitled
to receive upon exercise of the Warrant.

 

(g)                                  Notice of Adjustment. Not less than 10 days
prior to the record date or effective date, as the case may be, of any action
which requires or might require an adjustment or readjustment pursuant to this
Section 5, the Company shall give notice to the Warrant Holder of such event,
describing such event in reasonable detail and specifying the record date or
effective date, as the case may be, and, if determinable, the required
adjustment and computation thereof. If the required adjustment is not
determinable as the time of such notice, the Company shall give notice to the
Warrant Holder of such adjustment and computation as soon as reasonably
practicable after such adjustment becomes determinable. In connection with any
such adjustment or readjustment, at its sole cost and expense, the Company will
also cause independent certified public accountants of recognized national
standing (which may be the regular auditors of the Company) selected by the
Company to verify its computations and, in connection with the preparation of
the Company’s quarterly financial statements prepare a report setting forth such
adjustment or readjustment and showing in reasonable detail the method of
calculation thereof and the facts upon which such adjustment or readjustment is
based, including a statement of (i) the consideration received or to be received
by the Company for any Share Distribution issued or sold or

 

12

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

 

deemed to have been issued, (ii) the number of Shares outstanding or deemed to
be outstanding, and (iii) the Exercise Price in effect immediately prior to such
issue or sale and as adjusted and readjusted (if required by this Section 5) on
account thereof. The Company will forthwith mail a copy of each such report to
the Warrant Holder and will, upon the written request at any time of the Warrant
Holder, furnish to such holder a like report setting forth the Exercise Price at
the time in effect and showing in reasonable detail how it was calculated. The
Company will also keep copies of all such reports at its office and will cause
the same to be available for inspection at such office during normal business
hours by the Warrant Holder or any prospective purchaser of this Warrant
designated by the Warrant Holder.

 

(h)                                 Subsequent Warrants. Irrespective of any
adjustments in the Exercise Price or the number of Warrant Shares issuable upon
exercise of the Warrants theretofore or thereafter issued may continue to
express the same Exercise Price per Share and number and kind of Warrant Shares
as are stated in this Warrant.

 

(i)                                     Disputes. Any dispute which arises
between the Warrant Holder and the Company with respect to the calculation of
the adjusted Exercise Price or Warrant Shares issuable upon exercise shall be
determined by the independent auditors of the Company, and such determination
shall be binding upon the Company and the holders of the Warrants and the
Warrant Shares if made in good faith and without manifest error.

 

(j)                                    Other Actions Affecting Shares.

 

(i)                                     Equitable Equivalent. In case any event
shall occur as to which the provisions of this Section 5 set forth above hereof
are not strictly applicable but the failure to make any adjustment would not, in
the opinion of the Warrant Holder, fairly protect the purchase rights
represented by this Warrant in accordance with the essential intent and
principles of this Section 5, then, in each such case, at the request of the
Warrant Holder, the Company shall appoint a firm of independent investment
bankers mutually agreed by the Company and the Warrant Holder (which shall be
completely independent of the Company and shall be satisfactory to the holder or
the Requisite Holders), which shall give their opinion upon the adjustment, if
any, on a basis consistent with the essential intent and principles established
in this Section 5, necessary to preserve, without dilution, the purchase rights
represented by this Warrant. Upon receipt of such opinion, the Company will
promptly mail a copy thereof to the holder of this Warrant and shall make the
adjustments described therein. The costs of engagement of such investment bank
for the purposes of this section shall be paid by the Company.

 

(ii)                                  No Avoidance. The Company shall not, by
amendment of its certificate of incorporation or by-laws or through any
consolidation, merger, reorganization, transfer of assets, dissolution, issue or
sale of securities or any other voluntary action, avoid or seek to avoid the
observance or performance of any of the terms of this Warrant, but will at all
times in good faith assist in the carrying out of all such terms and in the
taking of all such action as may be necessary or appropriate in order to protect
the rights of the holder of this Warrant against dilution or other impairment as
if the holder was a shareholder of the Company entitled to the benefit of
fiduciary duties afforded to shareholders under Delaware law. Without limiting
the generality of the foregoing, the Company will (a) not increase the par value
of any Warrant Shares above the amount payable therefor upon such exercise
immediately prior to such increase in par value, (b) take all such action as may
be necessary or appropriate in order that the Company may validly and legally
issue fully paid and nonassessable Warrant Shares upon the exercise of this
Warrant, and (c) use commercially reasonable efforts to obtain all such
authorizations, exemptions or consents from any public regulatory body having
jurisdiction thereof as may be necessary to enable the Company to perform its
obligations under this Warrant.

 

(k)                                 Calculation of Consideration Received. The
consideration for the issue or sale of any Share Distribution shall,
irrespective of the accounting treatment of such consideration:

 

13

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

 

(i)                                     insofar as it consists of cash, be
computed at the amount of cash actually received by the Company without
reduction for any expenses paid or incurred by the Company or any commissions or
compensations paid or concessions or discounts allowed to underwriters, dealers
or others performing similar services in connection with such issue or sale;

 

(ii)                                  insofar as it consists of property
(including securities) other than cash actually received by the Company, be
computed at the Appraised Value thereof at the time of such issue or sale; and

 

(iii)                               insofar as it consists neither of cash nor
of other property, be computed as having no value.

 

(l)                                     Adjustment of Par Value. If for any
reason (including the operation of the adjustment provisions set forth in this
Warrant), the Exercise Price on any date of exercise of this Warrant shall not
be lawful and adequate consideration for the issuance of the relevant Warrant
Shares, then the Company shall take such steps as are necessary (including the
amendment of its certificate of incorporation so as to reduce the par value of
the Shares) to cause such Exercise Price to be adequate and lawful consideration
on the date the payment thereof is due, but if the Company shall fail to take
such steps, then the Company acknowledges that the Warrant Holder shall have
been damaged by the Company in an amount equal to an amount, which, when added
to the total Exercise Price for the relevant Warrant Shares, would equal lawful
and adequate consideration for the issuance of such Warrant Shares, and the
Company irrevocably agrees that if the Warrant Holder shall then forgive the
right to recover such damages from the Company, such forgiveness shall
constitute, and Company shall accept such forgiveness as, additional lawful
consideration for the issuance of the relevant Warrant Shares.

 

(m)                             Appraisal.

 

(i)                                     If the Requisite Holders shall, for any
reason whatsoever, disagree with the Company’s determination of the Appraised
Value of a Share, then such holders shall by notice to the Company (an
“Appraisal Notice”) given within sixty (60) days after the Company notifies the
holders of such determination, elect to dispute such determination, and such
dispute shall be resolved as set forth in clause (ii) of this Section.

 

(ii)                                  The Company shall within ten (10) days
after an Appraisal Notice shall have been given, engage an independent
investment bank of national repute (the “Appraiser”) selected by the Requisite
Holders and retained pursuant to an engagement letter between the Company and
the Appraiser with respect to such valuation in form and substance reasonably
acceptable to Requisite Holders, to make an independent determination of the
Appraised Value of a Share; such value shall be determined without deduction for
(a) liquidity considerations, (b) minority shareholder status, or (c) any
liquidation or other preference or any right of redemption in favor of any other
equity securities of the Company. The costs of engagement of such investment
bank for any such determination of Appraised Value shall be paid by the Company.

 

Section 6.                                           Registration Rights and
Extension of Expiration Date. The Warrant Holder is entitled to the benefit of
certain registration rights with respect to the Warrant Shares as provided in
the Subscription Agreement, dated as of July 29, 2016, by and between the
Company and the Participants (as defined therein), including the Warrant Holder
(the “Subscription Agreement”), and any subsequent holder hereof shall be
entitled to such rights to the extent provided in the Subscription Agreement. If
the Company fails to cause any Registration Statement covering “Registrable
Securities” (as that term is defined in the Subscription Agreement) to be
declared effective prior to the applicable dates set forth therein, or if an
Event as specified in Section 9.3 of the Subscription Agreement occurs and
continues, in each case, for more than thirty (30) days in any twelve (12) month
period, or for more than a total of

 

14

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

 

ninety (90) days, then the Expiration Date of this Warrant shall be extended one
day for each day beyond the thirty (30) day or ninety (90) day limits, as the
case may be, that the Event continues.

 

Section 7.                                           Transfer of Warrant. The
Warrant Holder upon transfer of the Warrant must deliver to the Company a duly
executed Warrant Assignment in the form of Exhibit B and upon surrender of this
Warrant to the Company, the Company shall execute and deliver a new Warrant with
appropriate changes to reflect such Assignment, in the name or names of the
assignee or assignees specified in the Warrant Assignment or other instrument of
assignment and, if the Warrant Holder’s entire interest is not being transferred
or assigned, in the name of the Warrant Holder, and upon the Company’s execution
and delivery of such new Warrant, this Warrant shall promptly be cancelled; and
provided that any assignee shall have all of the rights of an Initial Holder
hereunder. The Company shall pay any transfer tax imposed in connection with
such assignment (if any). Any transfer or exchange of this Warrant shall be
without charge to the Warrant Holder (except as provided above with respect to
transfer taxes, if any) and any new Warrant issued shall be dated the date
hereof.

 

Section 8.                                           Assistance in Disposition
of Warrant or Warrant Shares. Notwithstanding any other provision herein, in the
event that it becomes unlawful for the Warrant Holder to continue to hold the
Warrant, in whole or in part, or some or all of the Shares held by it, or
restrictions are imposed on any the Warrant Holder by any statute, regulation or
governmental authority which, in the judgment of the Warrant Holder, make it
unduly burdensome to continue to hold the Warrant or such Shares, the Warrant
Holder may sell or otherwise dispose of the Warrant (subject to the restrictions
on transfer provided in Section 7) or its Shares, and the Company agrees to
provide reasonable assistance to the Warrant Holder in disposing of the Warrant
and such Shares in a prompt and orderly manner and, at the request of the
Warrant Holder, to provide (and authorize the Warrant Holder to provide)
financial and other information concerning the Company to any prospective
purchaser of the Warrant or Shares owned by the Warrant Holder.

 

Section 9.                                           Identity of Transfer Agent.
The Transfer Agent for the Common Stock is Continental Stock Transfer & Trust
Company. Upon the appointment of any subsequent transfer agent for the Shares,
the Company will mail to the Warrant Holder a statement setting forth the name
and address of such transfer agent.

 

Section 10.                                    Covenants. The Company agrees
that:

 

(a)                                 Securities Filings; Rules 144 & 144A. The
Company will (i) file any reports required to be filed by it under the
Securities Act, the Exchange Act or the rules and regulations adopted by the
Commission thereunder, (ii) use its best efforts to cooperate with the Warrant
Holder and each holder of Warrant Shares in supplying such information
concerning the Company as may be necessary for the Warrant Holder or holder of
Warrant Shares to complete and file any information reporting forms currently or
hereafter required by the Commission as a condition to the availability of an
exemption from the Securities Act for the sale of any Warrants or Warrant
Shares, (iii) take such further action as the Warrant Holder may reasonably
request to the extent required from time to time to enable the Warrant Holder to
sell Warrant Shares without registration under the Securities Act within the
limitation of the exemptions provided by Rule 144 or 144A under the Securities
Act, as such Rules may be amended from time to time, or any similar rule or
regulation hereafter adopted by the Commission, and (iv) upon the request of the
Warrant Holder, deliver to the Warrant Holder a written statement as to whether
it has complied with such reporting requirements; provided that this
subsection (a) shall not require the Company to make any filing under the
Securities Act or Exchange Act which the Company is not otherwise obligated to
make.

 

(b)                                 Obtaining of Governmental Approvals and
Stock Exchange Listings. The Company will, at its own expense, (i) obtain and
keep effective any and all permits, consents and approvals of

 

15

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

 

governmental agencies and authorities which may from time to time be required of
the Company in order to satisfy its obligations hereunder, and (ii) take all
action which may be necessary so that the Warrant Shares, immediately upon their
issuance upon the exercise of the Warrants, will be listed on each securities
exchange, if any, on which the Shares are then listed.

 

(c)                                  Structural Dilution. So long as this
Warrant remains outstanding, the Company shall not permit any of its
Subsidiaries to issue, sell, distribute or otherwise grant in any manner
(including by assumption) any rights to subscribe for or to purchase, or any
warrants or options for the purchase of any equity securities of such Subsidiary
or any securities convertible into or exchangeable for such equity securities
(or any rights to subscribe for or to purchase, or any warrants or options for
the purchase of any such convertible or exchangeable securities), whether or not
immediately exercisable or exercisable prior to the Expiration Date or
thereafter.

 

(d)                                 Notices Of Corporate Action. In the event
of:

 

(i)                                     any taking by the Company of a record of
the holders of any class of securities for the purpose of determining the
holders thereof who are entitled to receive any distribution, or any right to
subscribe for, purchase or otherwise acquire any Shares or any other securities
or property, or to receive any other right, or

 

(ii)                                  any capital reorganization of the Company,
any reclassification or recapitalization of the capital stock of the Company,
any consolidation or merger involving the Company and any other Person or any
transfer of all or substantially all the assets of the Company to any other
Person, or any Corporate Reorganization, or

 

(iii)                               any voluntary or involuntary dissolution,
liquidation or winding-up of the Company,

 

the Company will mail to the Warrant Holder a notice specifying (i) the date or
expected date on which any such record is to be taken for the purpose of such
dividend, distribution or right, and the amount and character of such dividend,
distribution or right, (ii) the date or expected date on which any such
reorganization, reclassification, recapitalization, consolidation, merger,
transfer, dissolution, liquidation or winding-up is to take place, and (iii) the
time, if any such time is to be fixed, as of which the holders of record of
Shares (or other securities under Section 5(d)) shall be entitled to exchange
their Shares (or other securities under Section 5(d)) for the securities or
other property deliverable upon such reorganization, reclassification,
recapitalization, consolidation, merger, transfer, dissolution, liquidation or
winding-up and a description in reasonable detail of the transaction. Such
notice shall be mailed at least ten (10) Business Days prior to the date therein
specified.

 

Section 11.                                    Lost, Mutilated or Missing
Warrants. Upon receipt by the Company of evidence reasonably satisfactory to it
of the loss, theft, destruction or mutilation of any Warrant, and, in the case
of loss, theft or destruction, upon receipt of indemnification satisfactory to
the Company (in the case of an Initial Holder its unsecured, unbonded agreement
of indemnity or affidavit of loss shall be sufficient) or, in the case of
mutilation, upon surrender and cancellation of the mutilated Warrant, the
Company shall execute and deliver a new Warrant of like tenor and representing
the right to purchase the same aggregate number of Warrant Shares.

 

Section 12.                                    Waivers; Amendments. This Warrant
may be modified or amended or the provisions hereof waived only with the written
consent of the Company and the Warrant Holder. Any amendment or waiver effected
in compliance with this Section shall be binding upon the Company and the
Warrant Holder. The Company shall give prompt notice to the Warrant Holder of
any amendment or waiver effected in compliance with this Section. No failure or
delay of the Company or the Warrant

 

16

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

 

Holder in exercising any power or right hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right or power, or
any abandonment or discontinuance of steps to enforce such a right or power,
preclude any other or further exercise thereon or the exercise of any other
right or power. No notice or demand on the Company in any case shall entitle the
Company to any other or future notice or demand in similar or other
circumstances. The rights and remedies of the Company and the Warrant Holder
hereunder are cumulative and not exclusive of any rights or remedies which it
would otherwise have.

 

Section 13.                                    Miscellaneous.

 

(a)                                 Shareholder Rights. The Warrant shall not
entitle any Warrant Holder, prior to the exercise of the Warrant, to any rights
as a shareholder of the Company, except as set forth herein.

 

(b)                                 Expenses. The Company shall pay all
reasonable expenses of the Warrant Holder, including reasonable fees and
disbursements of counsel, in connection with the preparation of the Warrant, any
waiver or consent hereunder or any amendment or modification hereof (regardless
of whether the same becomes effective), or the enforcement of the provisions
hereof; provided that the Company shall not be required to pay any expenses of
the Warrant Holder arising solely in connection with a transfer of the Warrant.

 

(c)                                  Successors and Assigns. All the provisions
of this Warrant by or for the benefit of the Company or the Warrant Holder shall
bind and inure to the benefit of their respective successors and assigns.

 

(d)                                 Severability. In case any one or more of the
provisions contained in this Warrant shall be invalid, illegal or unenforceable
in any respect, the validity, legality and enforceability of the remaining
provisions contained herein shall not in any way be affected or impaired
thereby. The parties shall endeavor in good faith negotiations to replace the
invalid, illegal or unenforceable provisions with valid provisions the economic
effect of which comes as close as possible to that of the invalid, illegal or
unenforceable provisions.

 

(e)                                  Notices. Any notice or other communication
hereunder shall be in writing and shall be sufficient if sent by first-class
mail or courier, postage prepaid, and addressed as follows: (a) if to the
Company, addressed to the Company at its address for notices as set forth below
its signature hereon or any other address as the Company may hereafter notify to
the Warrant Holder and(b) if to the Warrant Holder, addressed to such address as
the Warrant Holder may hereafter from time to time notify to the Company for the
purposes of notice hereunder.

 

(f)                                   Equitable Remedies. Without limiting the
rights of the Company and the Warrant Holder to pursue all other legal and
equitable rights available to such party for the other parties’ failure to
perform its obligations hereunder, the Company and the Warrant Holder each
hereto acknowledge and agree that the remedy at law for any failure to perform
any obligations hereunder would be inadequate and that each shall be entitled to
specific performance, injunctive relief or other equitable remedies in the event
of any such failure.

 

(g)                                  Continued Effect. Rights and benefits
conferred on the holders of Warrant Shares pursuant to the provisions hereof
(including Section 6) shall continue to inure to the benefit of, and shall be
enforceable by, such holders, notwithstanding the surrender of the Warrant to,
and its cancellation by, the Company upon the full or partial exercise or
repurchase hereof.

 

(h)                                 Confidentiality. The Warrant Holder agrees
to keep confidential any proprietary information relating to the Company
delivered by the Company hereunder; provided that nothing herein

 

17

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

 

shall prevent the Warrant Holder from disclosing such information: (i) to any
holder of Warrants or Warrant Shares, (ii) to any Affiliate of any holder of
Warrants or Warrant Shares or any actual or potential transferee of the rights
or obligations hereunder that agrees to be bound by this Section 13(h),
(iii) upon order, subpoena, or other process of any court or administrative
agency or otherwise required by law, (iv) upon the request or demand of any
regulatory agency or authority having jurisdiction over such party, (v) which
has been publicly disclosed, (vi) which has been obtained from any Person that
is not a party hereto or an affiliate of any such party, (vii) in connection
with the exercise of any remedy, or the resolution of any dispute hereunder
(viii) to the legal counsel or certified public accountants for any holder of
Warrants or Warrant Shares, or (ix) as otherwise expressly contemplated by this
Warrant.

 

(i)                                     Governing Law. THIS WARRANT SHALL BE
CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW
YORK, EXCEPT AS OTHERWISE REQUIRED BY MANDATORY PROVISIONS OF LAW.

 

(j)                                    Section Headings. The section headings
used herein are for convenience of reference only and shall not be construed in
any way to affect the interpretation of any provisions of the Warrant.

 

18

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

 

IN WITNESS WHEREOF, the Company has caused this Warrant to be duly executed by
its authorized signatory as of the day and year first above written.

 

 

SteadyMed Ltd., an Israeli incorporated company

 

 

 

By

 

 

Name:

 

Title:

 

 

 

Address for Notices:

 

 

 

 

 

Telephone:

 

Facsimile:

 

19

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

 

Exhibit A to Warrant

 

Form of Notice of Exercise

 

,20  

 

To: [                        ]

 

Reference is made to the Warrant dated           . Terms defined therein are
used herein as therein defined.

 

The undersigned, pursuant to the provisions set forth in the Warrant, hereby
irrevocably elects and agrees to purchase         Shares, and makes payment
herewith in full therefor at the Exercise Price of $                in the
following form:                                                            .

 

[If the number of Shares as to which the Warrant is being exercised is less than
all of the Shares purchasable thereunder, the undersigned hereby requests that a
new Warrant representing the remaining balance of the Shares be registered in
the name of               , whose address is:                                .]

 

The undersigned hereby represents that it is exercising the Warrant for its own
account or the account of an Affiliate for investment purposes and not with the
view to any sale or distribution and that the Warrant Holder will not offer,
sell or otherwise dispose of the Warrant or any underlying Warrant Shares in
violation of applicable securities laws.

 

 

[NAME OF WARRANT HOLDER]

 

 

 

 

By

 

 

Name:

 

 

Title:

 

 

 

 

 

[ADDRESS OF WARRANT HOLDER]

 

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

 

Exhibit B to Warrant

 

Form of Warrant Assignment

 

Reference is made to the Warrant dated             , issued by
[                       ]. Terms defined therein are used herein as therein
defined.

 

FOR VALUE RECEIVED                      (the “Assignor”) hereby sells, assigns
and transfers all of the rights of the Assignor as set forth in such Warrant,
with respect to the number of Warrant Shares covered thereby as set forth below,
to the Assignee(s) as set forth below:

 

Number of Warrant Shares

 

Name(s) of Assignee(s)

 

Address(es)

 

Number of Warrant 
Shares

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

All notices to be given by the Company to the Assignor as the Warrant Holder
shall be sent to the Assignee(s) at the above listed address(es), and, if the
number of Shares being hereby assigned is less than all of the Shares covered by
the Warrant held by the Assignor, then also to the Assignor.

 

In accordance with Section 7 of the Warrant, the Assignor requests that the
Company execute and deliver a new Warrant or Warrants in the name or names of
the assignee or assignees, as is appropriate, or, if the number of Shares being
hereby assigned is less than all of the Shares covered by the Warrant held by
the Assignor, new Warrants in the name or names of the assignee or the
assignees, as is appropriate, and in the name of the Assignor.

 

The undersigned represents that the Assignee has represented to the Assignor
that the Assignee is acquiring the Warrant for its own account or the account of
an Affiliate for investment purposes and not with the view to any sale or
distribution, and that the Assignee will not offer, sell or otherwise dispose of
the Warrant or the Warrant Shares except under circumstances as will not result
in a violation of applicable securities laws.

 

Dated:                  , 20  

 

 

[NAME OF ASSIGNOR]

 

 

 

 

By

 

 

Name:

 

 

Title:

 

 

 

 

 

[ADDRESS OF ASSIGNOR]

 

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

 

APPENDIX A

 

Black Scholes Option Pricing formula to be used when calculating the value of
each new warrant to purchase one share in the Acquirer shall be:

 

[g157911km11i001.jpg]

 

CAcq = value of each warrant to purchase one share in the Acquirer

 

SAcq = price of Acquirer’s stock as determined by reference to the average of
the closing prices on the securities exchange or Nasdaq Global Market over the
20-day period ending three trading days prior to the closing of the Corporate
Reorganization described in Section 5(d) if the Acquirer’s stock is then traded
on such exchange or system, or the average of the closing bid or sale prices
(whichever is applicable) in the over-the-counter market over the 20-day period
ending three trading days prior to the closing of the Corporate Reorganization
if the Acquirer’s stock is then actively traded in the over-the-counter market,
or the then most recently completed financing if the Acquirer’s stock is not
then traded on a securities exchange or system or in the over-the-counter
market.

 

TAcq = expiration date of new warrants to purchase shares in the Acquirer =
TCorp

 

tAcq = date of issue of new warrants to purchase shares in the Acquirer

 

TAcq-tAcq = time until warrant expiration, expressed in years

 

σ = volatility = annualized standard deviation of daily log-returns (using a
262-day annualization factor) of the Acquirer’s stock price on the securities
exchange or Nasdaq Global Market over a 20-day trading period, determined by the
Warrant Holders, that is within the 100-day trading period ending on the trading
day immediately after the public announcement of the Corporate Reorganization
described in Section 5(d) if the Acquirer’s stock is then traded on such
exchange or system, or the annualized standard deviation of daily-log returns
(using a 262-day annualization factor) of the closing bid or sale prices
(whichever is applicable) in the over-the-counter market over a 20-day trading
period, determined by the Warrant Holder, that is within the 100-day trading
period ending on the trading day immediately after the public announcement of
the Corporate Reorganization if the Acquirer’s stock is then actively traded in
the over-the-counter market, or 0.9525 (or 95.25%) if the Acquirer’s stock is
not then traded on a securities exchange or system or in the over-the-counter
market.

 

N = cumulative normal distribution function

 

[g157911km11i002.jpg]

 

ln = natural logarithm

 

λ = dividend rate of the Acquirer for the most recent 12-month period at the
time of closing of the Corporate Reorganization.

 

KAcq = strike price of new warrants to purchase shares in the Acquirer = KCorp *
(SAcq / SCorp)

 

r = annual yield, as reported by Bloomberg at time tAcq, of the United States
Treasury security measuring the nearest time TAcq

 

d2 = d1- σ√(TAcq-tAcq)

 

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

 

Appendix B

 

Black Scholes Option Pricing formula to be used when calculating the value of
each Warrant to purchase one share in the Company shall be:

 

[g157911km11i003.jpg]

 

CCorp = value of each Warrant to purchase one share in the Company

 

SCorp = price of Company stock as determined by reference to the average of the
closing prices on the securities exchange or Nasdaq Global Market over the
20-day period ending three trading days prior to the closing of the Corporate
Reorganization described in Section 5(d) if the Company’s stock is then traded
on such exchange or system, or the average of the closing bid or sale prices
(whichever is applicable) in the over-the-counter market over the 20-day period
ending three trading days prior to the closing of the Corporate Reorganization
if the Company’s stock is then actively traded in the over-the-counter market,
or the then most recently completed financing if the Company’s stock is not then
traded on a securities exchange or system or in the over-the-counter market.

 

TCorp = expiration date of Warrants to purchase shares in the Company

 

tCorp = date of public announcement of transaction

 

TCorp-tCorp = time until Warrant expiration, expressed in years

 

σ = volatility = the annualized standard deviation of daily log-returns (using a
262-day annualization factor) of the Company’s stock price on the securities
exchange or Nasdaq Global Market over a 20-day trading period, determined by the
Warrant Holders, that is within the 100-day trading period ending on the trading
day immediately after the public announcement of the Corporate Reorganization
described in Section 5(d) if the Company’s stock is then traded on such exchange
or system, or the annualized standard deviation of daily-log returns (using a
262-day annualization factor) of the closing bid or sale prices (whichever is
applicable) in the over-the-counter market over a 20-day trading period,
determined by the Warrant Holder, that is within the 100-day trading period
ending on the trading day immediately after the public announcement of the
Corporate Reorganization if the Company’s stock is then actively traded in the
over-the-counter market, or 0.9525 (or 95.25%) if the Company’s stock is not
then traded on a securities exchange or system or in the over-the-counter
market.

 

N = cumulative normal distribution function

 

[g157911km11i004.jpg]

 

ln = natural logarithm

 

λ = dividend rate of the Company for the most recent 12-month period at the time
of closing of the Corporate Reorganization.

 

KCorp = strike price of warrant

 

r = annual yield, as reported by Bloomberg at time tCorp, of the United States
Treasury security measuring the nearest time TCorp

 

d2 = d1- σ√(TCorp-tCorp)

 

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

 

SCHEDULE 1

 

Fourth Amended Investor Rights Agreement, dated February 24, 2014, by and among
SteadyMed Ltd. and certain of its shareholders

 

29

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