Unassociated Document


    


      Exhibit
4.11

      


      Warrant
No. PA-1

      


      VENTRUS
BIOSCIENCES, INC.

      COMMON
STOCK WARRANT

       

      THIS
WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “ACT”), OR
UNDER THE SECURITIES LAWS OF ANY STATE.  THIS WARRANT IS SUBJECT TO
RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD
EXCEPT AS PERMITTED UNDER THE ACT AND THE APPLICABLE STATE SECURITIES LAWS,
PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM.  THE ISSUER OF THIS
WARRANT MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO
THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE
WITH THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS.

       

      This
certifies that National Securities Corporation (the “Holder”), its
designees or permitted assigns, at any time or from time to time up to and
including 5:00 p.m. (Eastern Time) on February 26, 2015 (the “Expiration Date”), is
entitled to purchase from Ventrus Biosciences, Inc., a Delaware corporation (the
“Company”),
that number of fully-paid and nonassessable shares (the “Warrant Shares”) of
the Company’s Common Stock, $0.001 par value per share (the “Common Stock”), equal
to 10% of the gross number of securities into which all of those certain
Convertible Promissory Notes (the “Notes”) issued to
investors (“Investors”) pursuant
to the Company’s Confidential Offering Memorandum, dated January 5, 2010, as the
same may be amended or supplemented from time to time (the “Memorandum”) are
convertible.  To exercise this
warrant (the “Warrant”), the Holder
must surrender to the Company at its principal office (or at such other location
as the Company may advise the Holder in writing) this Warrant properly endorsed
with the Form of Subscription attached hereto duly completed and signed and with
payment of the aggregate Exercise Price (as defined below, which may take the
form of a “Cashless Exercise” if so indicated in the Exercise Notice pursuant to
Section 1(b) below), for the number of Warrant Shares for which this Warrant is
being exercised determined in accordance with the provisions
hereof.  The per share exercise price (the “Exercise Price”) per
Warrant Share issuable pursuant to this Common Stock Warrant shall be equal to
110% of the price at which securities of the Company are sold in a Qualified IPO
(the “IPO
Price”), payable
in accordance with Section 1(a) hereof. Notwithstanding the foregoing, if a
Qualified IPO does not occur on or before February 26, 2012, then, at the sole
option of the Holder, (x) this Common Stock Warrant will be exercisable for that
number of Warrant Shares equal fifty percent (50%) of the aggregate principal
amount of the Notes purchased by the Investors in the Offering divided by $1.00
and (y) the Exercise Price shall be $1.00. The Exercise Price is subject to
adjustment as provided in Section 3 of this
Warrant.  Notwithstanding the foregoing, the Company shall have the
right to redeem this Warrant as described in
Section 4 hereof.  If no Qualified IPO has occurred by
February 26, 2012 and should the Holder elect to adjust the Per Share Warrant
Price to $1.00 herein, he may do so at any time relating to any unexercised
portion of this Warrant by providing written notice to the Company of such
election.  All capitalized terms not defined herein shall have the
meaning assigned to such terms in the Notes.


      
        
           


        

        
           


          
            

          

        

        
           


        

      


      The
Company shall notify the Holder in writing at least five (5) days prior to the
closing of a Qualified IPO to advise Holder as the number of Warrant Shares and
Exercise Price of this Warrant.  Upon request of the Holder, upon
return to the Company of this Warrant, or upon receipt of a lost warrant
affidavit in form and substance reasonably acceptable to the Company in the
event this Warrant shall be lost or destroyed, the Company shall provide Holder
with a new Warrant setting forth the number of Warrant Shares underlying this
Warrant and the Exercise Price thereof.  Notices hereunder shall be
sent by the same means and notices sent pursuant to Section 4(b)
hereof.

       

      This
Warrant is issued subject to the following terms and conditions:

       

      1.           Exercise, Issuance of
Certificates.  Subject to Section 4 hereof, the
Holder may exercise this Warrant at any time or from time to time after the
earlier to occur of a Qualified IPO or the second anniversary of the Initial
Closing, and on or prior to the Expiration Date for all or any part of the
Warrant Shares (but not for a fraction of a share) that may be purchased
hereunder, as that number may be adjusted pursuant to Section 3 of
this Warrant.  The Company agrees that the Warrant Shares purchased
under this Warrant shall be and are deemed to be issued to the Holder hereof as
the record owner of such Warrant Shares as of the close of business on the date
on which this Warrant shall have been surrendered, properly endorsed, the
completed and executed Form of Subscription delivered, and payment made for such
Warrant Shares (such date, a “Date of
Exercise”).  Certificates for the Warrant Shares so purchased,
together with any other securities or property to which the Holder hereof is
entitled upon such exercise, shall be delivered to the Holder hereof by the
Company at the Company’s expense as soon as practicable after the rights
represented by this Warrant have been so exercised, but in any event not later
than ten (10) business days following the Date of Exercise.  In case
of a purchase of less than all the Warrant Shares which may be purchased under
this Warrant, the Company shall cancel this Warrant and execute and deliver to
the Holder hereof within a reasonable time a new Warrant or Warrants of like
tenor for the balance of the Warrant Shares purchasable under the Warrant
surrendered upon such purchase.  Each stock certificate so delivered
shall be registered in the name of such Holder and issued with a legend in
substantially the form of the legend placed on the front of this
Warrant.

       

      (a)           The
Company’s obligations to issue and deliver Warrant Shares in accordance with the
terms hereof are absolute and unconditional, irrespective of any action or
inaction by the Holder to enforce the same.  Nothing herein shall
limit a 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 representing shares of Common Stock upon exercise of
the Warrant  as required pursuant to the terms hereof.

       

      (b)           The
Holder shall pay the Exercise Price in immediately available funds (a “Cash Exercise”); or
the Holder may satisfy its obligation to pay the Exercise Price through a “Cashless Exercise,”
in which event the Company shall issue to the Holder the number of Warrant
Shares determined as follows:

       

      
        
          
            
              	 
      	
                      X =
      Y [(A-B)/A]

                    
	
                      where:

                    	 
      
	 
      	
                      X =
      the number of Warrant Shares to be issued to the
Holder.

                    
	 
      	 
      
	 
      	
                      Y =
      the number of Warrant Shares with respect to which this Warrant is being
      exercised (prior to cashless exercise).

                    
	 
      	 
      
	 
      	
                      A =
      the average of the Closing Prices for the five (5) Trading Days
      immediately prior to (but not including) the Exercise
  Date.

                    
	 
      	 
      
	 
      	
                      B =
      the Exercise
Price.

                    


            

          

        

      


      
        
           


        

        
           


          
            

          

        

        
           


        

      


      For
purposes of this Section 1, “Closing Prices” for any date,
shall mean the closing price per share of the Common Stock for such date (or the
nearest preceding date) on the primary trading market on which the Common Stock
is then listed or quoted.

       

      For
purposes of Rule 144 promulgated under the Securities Act, it is intended,
understood and acknowledged that the Warrant Shares issued in a cashless
exercise transaction shall be deemed to have been acquired by the Holder, and
the holding period for the Warrant Shares shall be deemed to have commenced, on
the date this Warrant was originally issued to the Holder (provided the
Securities and Exchange Commission continues to take the position that such
treatment is proper at the time of such exercise).

       

      2.           Shares to be Fully Paid;
Reservation of Shares.  The Company covenants and agrees that
all Warrant Shares will, upon issuance and payment of the applicable Exercise
Price, be duly authorized, validly issued, fully paid and nonassessable, and
free of all preemptive rights, liens and encumbrances, except for restrictions
on transfer provided for herein.  The Company shall at all times
reserve and keep available out of its authorized and unissued Common Stock,
solely for the purpose of providing for the exercise of the rights to purchase
all Warrant Shares granted pursuant to this Warrant, such number of shares of
Common Stock as shall, from time to time, be sufficient therefor.

       

      3.           Adjustment of Exercise Price
and Number of Shares.  The Exercise Price and the total number
of Warrant Shares shall be subject to adjustment from time to time upon the
occurrence of certain events described in this Section 3.

       

      (a)           Subdivision or Combination
of Stock.  In the event the outstanding shares of the Company’s
Common Stock shall be increased by a stock dividend payable in Common Stock,
stock split, subdivision, or other similar transaction occurring after the date
hereof into a greater number of shares of Common Stock, the Exercise Price in
effect immediately prior to such subdivision shall be proportionately reduced
and the number of Warrant Shares issuable hereunder proportionately
increased.  Conversely, in the event the outstanding shares of the
Company’s Common Stock shall be decreased by reverse stock split, combination,
consolidation, or other similar transaction occurring after the date hereof into
a lesser number of shares of Common Stock, the Exercise Price in effect
immediately prior to such combination shall be proportionately increased and the
number of Warrant Shares issuable hereunder proportionately
decreased.

       

      (b)           Reclassification.  If
any reclassification of the capital stock of the Company or any reorganization,
consolidation, merger, or any sale, lease, license, exchange or other transfer
(in one transaction or a series of related transactions) of all or substantially
all, of the business and/or assets of the Company (the “Reclassification
Events”) shall be effected in such a way that holders of Common Stock
shall be entitled to receive stock, securities, or other assets or property,
then, as a condition of such Reclassification Event, lawful and adequate
provisions shall be made whereby the Holder hereof shall thereafter have the
right to purchase and receive (in lieu of the shares of Common Stock of the
Company immediately theretofore purchasable and receivable upon the exercise of
the rights represented hereby) such shares of stock, securities, or other assets
or property as may be issued or payable with respect to or in exchange for a
number of outstanding shares of such Common Stock equal to the number of shares
of such stock immediately theretofore purchasable and receivable upon the
exercise of the rights represented hereby.  In any Reclassification
Event, appropriate provision shall be made with respect to the rights and
interests of the Holder of this Warrant to the end that the provisions hereof
(including, without limitation, provisions for adjustments of the Exercise Price
and of the number of Warrant Shares), shall thereafter be applicable, as nearly
as may be, in relation to any shares of stock, securities, or assets thereafter
deliverable upon the exercise hereof.


      
        
           


        

        
           


          
            

          

        

        
           


        

      


      (c)           Notice of
Adjustment.  Upon any adjustment of the Exercise Price or any
increase or decrease in the number of Warrant Shares, the Company shall give
written notice thereof, by first class mail postage prepaid, addressed to the
registered Holder of this Warrant at the address of such Holder as shown on the
books of the Company.  The notice shall be prepared and signed by the
Company’s Chief Financial Officer and shall state the Exercise Price resulting
from such adjustment and the increase or decrease, if any, in the number of
shares purchasable at such price upon the exercise of this Warrant, setting
forth in reasonable detail the method of calculation and the facts upon which
such calculation is based.

      


      4.           Redemption of
Warrants.

       

      (a)           Redemption.  This
Warrant may be redeemed at the option of the Company, at any time after the date
the Common Stock is traded on the Over-the-Counter Bulletin Board (the “OTCBB”), Small Cap
Market System or on a national securities exchange, following a period of thirty
(30) consecutive calendar days in which the per share average closing sale price
of the Common Stock equals or exceeds an amount that is twice the Exercise Price, on
notice as set forth in Section 4(b) hereof, and at a redemption price
equal to $0.001 (the “Redemption Price”)
for each Warrant Share purchasable under this Warrant; provided, however, that this
Warrant may not be redeemed by the Company unless the resale of the Warrant
Shares purchasable hereunder has been registered under the Securities Act of
1933, as amended (the “Act”) or are
otherwise freely tradable.  For purposes of this Section, the closing
sale price of the Common Stock shall be determined by the closing price as
reported by the OTCBB so long as the Common Stock is quoted on the OTCBB, and if
the Common Stock is hereafter listed or quoted on the SmallCap Market Systems or
a national securities exchange, shall be determined by the last reported sale
price on the primary exchange or market on which the Common Stock is
traded.

       

      (b)           Notice of
Redemption.  In the case of any redemption of this Warrant, the
Company shall give notice of such redemption to the Holder hereof as provided in
this Section 4(b).  Notice of redemption to the Holder of this Warrant
shall be given in person, by recognized overnight courier, mailed by certified
or registered mail, return receipt requested, or by confirmed facsimile
transmission, to the Holder’s last address and/or facsimile of record with the
Company not less than thirty (30) days prior to the date fixed for
redemption.  Any notice which is given in the manner herein provided
shall be conclusively presumed to have been duly given, whether or not the
Holder receives the notice.  Each such notice shall specify the date
fixed for redemption, the place of redemption and the aggregate Redemption
Price, and shall state that payment of the Redemption Price will be made upon
surrender of this Warrant at such place of redemption, and that if not exercised
by the close of business on the date fixed for redemption, the exercise rights
of the Warrant shall expire unless extended by the Company.  Such
notice shall also state the current Exercise Price and the date on which the
right to exercise the Warrant will expire unless extended by the
Company.

       

      (c)           Payment of Redemption
Price.  If notice of redemption shall have been given as
provided in Section 4(b), the Redemption Price shall, unless the Warrant is
theretofore exercised pursuant to the terms hereof, become due and payable on
the date and at the place stated in such notice.  On and after such
date of redemption, the exercise rights of this Warrant shall expire and this
Warrant shall be null and void on presentation and surrender of this Warrant at
such place of payment in such notice specified, this Warrant shall be paid and
redeemed at the Redemption Price per Warrant Share within ten (10) days
thereafter.

       

      5.           No Voting or Dividend
Rights.  Nothing contained in this Warrant shall be construed
as conferring upon the holder hereof the right to vote or to consent to receive
notice as a stockholder of the Company on any other matters or any rights
whatsoever as a shareholder of the Company.  No dividends or interest
shall be payable or accrued in respect of this Warrant or the interest
represented hereby or the shares purchasable hereunder until, and only to the
extent that, this Warrant shall have been exercised.


      
        
           


        

        
           


          
            

          

        

        
           


        

      


      6.           Compliance with Securities
Act. The Holder of this Warrant, by acceptance hereof, agrees that this
Warrant is being acquired for its own account and not for any other person or
persons, for investment purposes and that it will not offer, sell, or otherwise
dispose of this Warrant except under circumstances which will not result in a
violation of the Act or any applicable state securities laws.

       

      7.           Limited
Transferability.  The Holder represents that by accepting this
Warrant it understands that this Warrant and any securities obtainable upon
exercise of this Warrant have not been registered for sale under Federal or
state securities laws and are being offered and sold to the Holder pursuant to
one or more exemptions from the registration requirements of such securities
laws.  In the absence of an effective registration of such securities
or an exemption therefrom, any certificates for such securities shall bear the
legend set forth on the first page hereof.  The Holder understands
that it must bear the economic risk of its investment in this Warrant and any
securities obtainable upon exercise of this Warrant for an indefinite period of
time, as this Warrant and such securities have not been registered under Federal
or state securities laws and therefore cannot be sold unless subsequently
registered under such laws, unless an exemption from such registration is
available.  Notwithstanding anything contained herein, the Company
shall, upon written instructions to be delivered to the Company within thirty
(30) business days following the date hereof, transfer all or a portion of this
Warrant to officers, directors, employees and other registered agents or
associated persons of the Holder.

       

      8.           Amendment, Waiver,
etc.  Except as expressly provided herein, neither this Warrant
nor any term hereof may be amended, waived, discharged or terminated other than
by a written instrument signed by the party against whom enforcement of any such
amendment, waiver, discharge or termination is sought.

       

      9.           Notices.  Any
notice, request, or other document required or permitted to be given or
delivered to the Holder hereof or the Company shall be delivered as set forth in
the Purchase Agreement.

       

      10.         Governing
Law.  This Warrant shall be construed and enforced in
accordance with, and the rights of the parties shall be governed by, the laws of
the State of Delaware.

       

      11.         Lost or Stolen
Warrant.  Upon receipt of evidence reasonably satisfactory to
the Company of the loss, theft, destruction, or mutilation of this Warrant and,
in the case of any such loss, theft or destruction, upon receipt of an indemnity
reasonably satisfactory to the Company, or in the case of any such mutilation,
upon surrender and cancellation of such Warrant, the Company, at its expense,
will make and deliver a new Warrant, of like tenor, in lieu of the lost, stolen,
destroyed or mutilated Warrant.

       

      12.         Fractional
Shares.  No fractional shares shall be issued upon exercise of
this Warrant.  The Company shall, in lieu of issuing any fractional
share, pay the Holder entitled to such fraction a sum in cash equal to such
fraction (calculated to the nearest 1/100th of a share) multiplied by the then
effective Exercise Price on the date the Form of Subscription is received by the
Company.

       

      13.         Successors and
Assigns.  This Warrant and the rights evidenced hereby shall
inure to the benefit of and be binding upon the successors of the Company and
the successors and assigns of the Holder.  The provisions of this
Warrant are intended to be for the benefit of all Holders from time to time of
this Warrant, and shall be enforceable by any such Holder.


      
        
           


        

        
           


          
            

          

        

        
           


        

      


      14.         Severability of
Provisions. In case any one or more of the provisions of this Warrant
shall be invalid or unenforceable in any respect, the validity and
enforceability of the remaining terms and provisions of this Warrant shall not
in any way be affected or impaired thereby and the parties will attempt in good
faith to agree upon a valid and enforceable provision which shall be a
commercially reasonable substitute therefor, and upon so agreeing, shall
incorporate such substitute provision in this Warrant.

       

      15.         Registration of Warrant
Shares.  The Warrant Shares shall be entitled to the same
registration rights granted to the Investors as set forth in those certain
Subscription Agreements between the Company and the Investors and such
registration rights are hereby incorporated by reference for the benefit of the
Holder.

       

      [Signature
Page Follows]


      
        
           


        

        
           


          
            

          

        

        
           


        

      


      Warrant
No. PA-1


      IN
WITNESS WHEREOF, the Company has caused this Warrant to be duly executed as of
this 26th day of
February, 2010.

      


      
        
          
            	
                    VENTRUS
      BIOSCIENCES, INC.

                  
	 
      
	
                    By:

                  	
                    /s/
      Thom Rowland

                  
	 
      	
                    Name:  Thom
      Rowland

                  
	 
      	
                    Title:  Acting
      President

                  


          

        

      

      


      Signature
Page—Placement Agent Warrant


      
        
           


        

        
           


          
            

          

        

        
           


        

      


      EXHIBIT
A

       

      FORM
OF SUBSCRIPTION

       

      (To be
signed only upon exercise of Warrant)

       

      To:        Ventrus
Biosciences, Inc.

       

      The undersigned is the Holder of
Warrant No. _______ (the “Warrant”) issued by Ventrus
Biosciences, Inc., a Delaware corporation (the “Company”).  Capitalized
terms used herein and not otherwise defined have the respective meanings set
forth in the Warrant.

       

      
        	
                 
      

              	
                (a)

              	
                The
      Warrant is currently exercisable to purchase a total of ______________
      Warrant Shares.

              


      

       

      
        	
                 
      

              	
                (b)

              	
                The
      undersigned Holder hereby exercises its right to purchase
      _________________ Warrant Shares pursuant to the
  Warrant.

              


      

       

      
        	
                 
      

              	
                (c)

              	
                The
      holder shall make payment of the Exercise Price as follows (check
      one):

              


      

       

      _______________
“Cash Exercise” under Section 1

       

      _______________
“Cashless Exercise” under Section 1

       

      
        	
                 
      

              	
                (d)

              	
                If
      the holder is making a Cash Exercise, the holder shall pay the sum of
      $____________ to the Company in accordance with the terms of the
      Warrant.

              


      

       

      
        	
                 
      

              	
                (e)

              	
                Pursuant
      to this exercise, the Company shall deliver to the holder ______________
      Warrant Shares in accordance with the terms of the
  Warrant.

              


      

       

      
        	
                 
      

              	
                (f)

              	
                Following
      this exercise, the Warrant shall be exercisable to purchase a total of
      ______________ Warrant Shares.

              


      

       

      The
undersigned requests that certificates for such shares be issued in the name of,
and delivered
to: ___________________________________________________________________________________________________
whose address is: ______________________________________________________________________________________. 

       

      DATED:                                                      

       

      


      
        
          
            
              
                	 
      
	
                        (Signature
      must conform in all respects to name of

                        Holder
      as specified on the face of the Warrant)

                      
	 
      	 
      
	
                        Name: 

                      	 
      
	 
      	 
      
	
                        Title: 

                      	 
      


              

            

          

        

      


      
        
           


        

        
           


          
            

          

        

        
           


        

      


      EXHIBIT
B

      


      FORM
OF ASSIGNMENT

       

      (To
assign the foregoing Warrant, execute this form and supply required
information.  Do not use this form to purchase shares.)

       

      For Value
Received, the foregoing Warrant and all rights evidenced thereby are
hereby assigned to:

       

      
        
          
            
              
                	
                        Name: 

                      	 
      
	
                        (Please
      Print)

                      


              

            

          

        

      

      


      
        
          
            	
                    Address: 

                  	 
      
	
                    (Please
      Print)

                  


          

        

      

      


      Dated:  __________,
20__

      


      
        
          
            
              
                	
                        Holder’s

                      	 
      
	
                        Signature: 

                      	 
      
	 
      	 
      
	
                        Holder’s

                      	 
      
	
                        Address:

                      	 
      


              

            

          

        

      

      


      NOTE:  The signature
to this Form of Assignment must correspond with the name as it appears on the
face of the Warrant, without alteration or enlargement or any change
whatever.  Officers of corporations and those acting in a fiduciary or
other representative capacity should file proper evidence of authority to assign
the foregoing Warrant.

       

    

     

    
      
        
        

      

      
        
        

        
        

      

      
        
        

      

    

     

    Warrant
No. PA-2

    VENTRUS
BIOSCIENCES, INC.

    COMMON
STOCK WARRANT

     

    THIS
WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “ACT”), OR
UNDER THE SECURITIES LAWS OF ANY STATE.  THIS WARRANT IS SUBJECT TO
RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD
EXCEPT AS PERMITTED UNDER THE ACT AND THE APPLICABLE STATE SECURITIES LAWS,
PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM.  THE ISSUER OF THIS
WARRANT MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO
THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE
WITH THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS.

     

    This
certifies that National Securities Corporation (the “Holder”), its
designees or permitted assigns, at any time or from time to time up to and
including 5:00 p.m. (Eastern Time) on February 26, 2015 (the “Expiration Date”), is
entitled to purchase from Ventrus Biosciences, Inc., a Delaware corporation (the
“Company”),
that number of fully-paid and nonassessable shares (the “Warrant Shares”) of
the Company’s Common Stock, $0.001 par value per share (the “Common Stock”), equal
to 10% of the gross number of securities into which all of those certain
Convertible Promissory Notes (the “Notes”) issued to
investors (“Investors”) pursuant
to the Company’s Confidential Offering Memorandum, dated January 5, 2010, as the
same may be amended or supplemented from time to time (the “Memorandum”) are
convertible.  To exercise this
warrant (the “Warrant”), the Holder
must surrender to the Company at its principal office (or at such other location
as the Company may advise the Holder in writing) this Warrant properly endorsed
with the Form of Subscription attached hereto duly completed and signed and with
payment of the aggregate Exercise Price (as defined below, which may take the
form of a “Cashless Exercise” if so indicated in the Exercise Notice pursuant to
Section 1(b) below), for the number of Warrant Shares for which this Warrant is
being exercised determined in accordance with the provisions
hereof.  The per share exercise price (the “Exercise Price”) per
Warrant Share issuable pursuant to this Common Stock Warrant shall be equal to
110% of the price at which securities of the Company are sold in a Qualified IPO
(the “IPO
Price”), payable
in accordance with Section 1(a) hereof. Notwithstanding the foregoing, if a
Qualified IPO does not occur on or before February 26, 2012, then, at the sole
option of the Holder, (x) this Common Stock Warrant will be exercisable for that
number of Warrant Shares equal fifty percent (50%) of the aggregate principal
amount of the Notes purchased by the Investors in the Offering divided by $1.00
and (y) the Exercise Price shall be $1.00. The Exercise Price is subject to
adjustment as provided in Section 3 of this Warrant.  Notwithstanding
the foregoing, the Company shall have the right to redeem this Warrant as
described in Section 4 hereof.  If no Qualified IPO has occurred by
February 26, 2012 and should the Holder elect to adjust the Per Share Warrant
Price to $1.00 herein, he may do so at any time relating to any unexercised
portion of this Warrant by providing written notice to the Company of such
election.  All capitalized terms not defined herein shall have the
meaning assigned to such terms in the Notes.

     

    The
Company shall notify the Holder in writing at least five (5) days prior to the
closing of a Qualified IPO to advise Holder as to the number of Warrant Shares
and Exercise Price of this Warrant.  Upon request of the Holder, upon
return to the Company of this Warrant, or upon receipt of a lost warrant
affidavit in form and substance reasonably acceptable to the Company in the
event this Warrant shall be lost or destroyed, the Company shall provide Holder
with a new Warrant setting forth the number of Warrant Shares underlying this
Warrant and the Exercise Price thereof.  Notices hereunder shall be
sent by the same means and notices sent pursuant to Section 4(b)
hereof.


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    This
Warrant is issued subject to the following terms and conditions:

     

    1.           Exercise, Issuance of
Certificates.  Subject to Section 4 hereof, the Holder may
exercise this Warrant at any time or from time to time after the earlier to
occur of a Qualified IPO or the second anniversary of the Initial Closing, and
on or prior to the Expiration Date for all or any part of the Warrant Shares
(but not for a fraction of a share) that may be purchased hereunder, as that
number may be adjusted pursuant to Section 3 of this Warrant.  The
Company agrees that the Warrant Shares purchased under this Warrant shall be and
are deemed to be issued to the Holder hereof as the record owner of such Warrant
Shares as of the close of business on the date on which this Warrant shall have
been surrendered, properly endorsed, the completed and executed Form of
Subscription delivered, and payment made for such Warrant Shares (such date, a
“Date of
Exercise”).  Certificates for the Warrant Shares so purchased,
together with any other securities or property to which the Holder hereof is
entitled upon such exercise, shall be delivered to the Holder hereof by the
Company at the Company’s expense as soon as practicable after the rights
represented by this Warrant have been so exercised, but in any event not later
than ten (10) business days following the Date of Exercise.  In case
of a purchase of less than all the Warrant Shares which may be purchased under
this Warrant, the Company shall cancel this Warrant and execute and deliver to
the Holder hereof within a reasonable time a new Warrant or Warrants of like
tenor for the balance of the Warrant Shares purchasable under the Warrant
surrendered upon such purchase.  Each stock certificate so delivered
shall be registered in the name of such Holder and issued with a legend in
substantially the form of the legend placed on the front of this
Warrant.

     

    (a)           The
Company’s obligations to issue and deliver Warrant Shares in accordance with the
terms hereof are absolute and unconditional, irrespective of any action or
inaction by the Holder to enforce the same.  Nothing herein shall
limit a 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 representing shares of Common Stock upon exercise of
the Warrant  as required pursuant to the terms hereof.

     

    (b)           The
Holder shall pay the Exercise Price in immediately available funds (a “Cash Exercise”); or
the Holder may satisfy its obligation to pay the Exercise Price through a “Cashless Exercise,”
in which event the Company shall issue to the Holder the number of Warrant
Shares determined as follows:

     

    
      	 
      	
              X =
      Y [(A-B)/A]

            
	
              where:

            	 
      
	 
      	
              X =
      the number of Warrant Shares to be issued to the
Holder.

            
	 
      	 
      
	 
      	
              Y =
      the number of Warrant Shares with respect to which this Warrant is being
      exercised (prior to cashless exercise).

            
	 
      	 
      
	 
      	
              A =
      the average of the Closing Prices for the five (5) Trading Days
      immediately prior to (but not including) the Exercise
  Date.

            
	 
      	 
      
	 
      	
              B =
      the Exercise Price.

            


    


    
      
         


      

      
        2

        
          

        

      

      
         


      

    


    For
purposes of this Section 1, “Closing Prices” for any date,
shall mean the closing price per share of the Common Stock for such date (or the
nearest preceding date) on the primary trading market on which the Common Stock
is then listed or quoted.

     

    For
purposes of Rule 144 promulgated under the Securities Act, it is intended,
understood and acknowledged that the Warrant Shares issued in a cashless
exercise transaction shall be deemed to have been acquired by the Holder, and
the holding period for the Warrant Shares shall be deemed to have commenced, on
the date this Warrant was originally issued to the Holder (provided the
Securities and Exchange Commission continues to take the position that such
treatment is proper at the time of such exercise).

     

    2.           Shares to be Fully Paid;
Reservation of Shares.  The Company covenants and agrees that
all Warrant Shares will, upon issuance and payment of the applicable Exercise
Price, be duly authorized, validly issued, fully paid and nonassessable, and
free of all preemptive rights, liens and encumbrances, except for restrictions
on transfer provided for herein.  The Company shall at all times
reserve and keep available out of its authorized and unissued Common Stock,
solely for the purpose of providing for the exercise of the rights to purchase
all Warrant Shares granted pursuant to this Warrant, such number of shares of
Common Stock as shall, from time to time, be sufficient therefor.

     

    3.           Adjustment of Exercise Price
and Number of Shares.  The Exercise Price and the total number
of Warrant Shares shall be subject to adjustment from time to time upon the
occurrence of certain events described in this Section 3.

     

    (a)           Subdivision or Combination
of Stock.  In the event the outstanding shares of the Company’s
Common Stock shall be increased by a stock dividend payable in Common Stock,
stock split, subdivision, or other similar transaction occurring after the date
hereof into a greater number of shares of Common Stock, the Exercise Price in
effect immediately prior to such subdivision shall be proportionately reduced
and the number of Warrant Shares issuable hereunder proportionately
increased.  Conversely, in the event the outstanding shares of the
Company’s Common Stock shall be decreased by reverse stock split, combination,
consolidation, or other similar transaction occurring after the date hereof into
a lesser number of shares of Common Stock, the Exercise Price in effect
immediately prior to such combination shall be proportionately increased and the
number of Warrant Shares issuable hereunder proportionately
decreased.

     

    (b)           Reclassification.  If
any reclassification of the capital stock of the Company or any reorganization,
consolidation, merger, or any sale, lease, license, exchange or other transfer
(in one transaction or a series of related transactions) of all or substantially
all, of the business and/or assets of the Company (the “Reclassification
Events”) shall be effected in such a way that holders of Common Stock
shall be entitled to receive stock, securities, or other assets or property,
then, as a condition of such Reclassification Event, lawful and adequate
provisions shall be made whereby the Holder hereof shall thereafter have the
right to purchase and receive (in lieu of the shares of Common Stock of the
Company immediately theretofore purchasable and receivable upon the exercise of
the rights represented hereby) such shares of stock, securities, or other assets
or property as may be issued or payable with respect to or in exchange for a
number of outstanding shares of such Common Stock equal to the number of shares
of such stock immediately theretofore purchasable and receivable upon the
exercise of the rights represented hereby.  In any Reclassification
Event, appropriate provision shall be made with respect to the rights and
interests of the Holder of this Warrant to the end that the provisions hereof
(including, without limitation, provisions for adjustments of the Exercise Price
and of the number of Warrant Shares), shall thereafter be applicable, as nearly
as may be, in relation to any shares of stock, securities, or assets thereafter
deliverable upon the exercise hereof.


    
      
         


      

      
        3

        
          

        

      

      
         


      

    


    (c)           Notice of
Adjustment.  Upon any adjustment of the Exercise Price or any
increase or decrease in the number of Warrant Shares, the Company shall give
written notice thereof, by first class mail postage prepaid, addressed to the
registered Holder of this Warrant at the address of such Holder as shown on the
books of the Company.  The notice shall be prepared and signed by the
Company’s Chief Financial Officer and shall state the Exercise Price resulting
from such adjustment and the increase or decrease, if any, in the number of
shares purchasable at such price upon the exercise of this Warrant, setting
forth in reasonable detail the method of calculation and the facts upon which
such calculation is based.

    


    4.           Redemption of
Warrants.

     

    (a)           Redemption.  This
Warrant may be redeemed at the option of the Company, at any time after the date
the Common Stock is traded on the Over-the-Counter Bulletin Board (the “OTCBB”), Small Cap
Market System or on a national securities exchange, following a period of thirty
(30) consecutive calendar days in which the per share average closing sale price
of the Common Stock equals or exceeds an amount that is twice the Exercise Price, on
notice as set forth in Section 4(b) hereof, and at a redemption price equal to
$0.001 (the “Redemption Price”)
for each Warrant Share purchasable under this Warrant; provided, however, that this
Warrant may not be redeemed by the Company unless the resale of the Warrant
Shares purchasable hereunder has been registered under the Securities Act of
1933, as amended (the “Act”) or are
otherwise freely tradable.  For purposes of this Section, the closing
sale price of the Common Stock shall be determined by the closing price as
reported by the OTCBB so long as the Common Stock is quoted on the OTCBB, and if
the Common Stock is hereafter listed or quoted on the SmallCap Market Systems or
a national securities exchange, shall be determined by the last reported sale
price on the primary exchange or market on which the Common Stock is
traded.

     

    (b)           Notice of
Redemption.  In the case of any redemption of this Warrant, the
Company shall give notice of such redemption to the Holder hereof as provided in
this Section 4(b).  Notice of redemption to the Holder of this Warrant
shall be given in person, by recognized overnight courier, mailed by certified
or registered mail, return receipt requested, or by confirmed facsimile
transmission, to the Holder’s last address and/or facsimile of record with the
Company not less than thirty (30) days prior to the date fixed for
redemption.  Any notice which is given in the manner herein provided
shall be conclusively presumed to have been duly given, whether or not the
Holder receives the notice.  Each such notice shall specify the date
fixed for redemption, the place of redemption and the aggregate Redemption
Price, and shall state that payment of the Redemption Price will be made upon
surrender of this Warrant at such place of redemption, and that if not exercised
by the close of business on the date fixed for redemption, the exercise rights
of the Warrant shall expire unless extended by the Company.  Such
notice shall also state the current Exercise Price and the date on which the
right to exercise the Warrant will expire unless extended by the
Company.

     

    (c)           Payment of Redemption
Price.  If notice of redemption shall have been given as
provided in Section 4(b), the Redemption Price shall, unless the Warrant is
theretofore exercised pursuant to the terms hereof, become due and payable on
the date and at the place stated in such notice.  On and after such
date of redemption, the exercise rights of this Warrant shall expire and this
Warrant shall be null and void on presentation and surrender of this Warrant at
such place of payment in such notice specified, this Warrant shall be paid and
redeemed at the Redemption Price per Warrant Share within ten (10) days
thereafter.

     

    5.           No Voting or Dividend
Rights.  Nothing contained in this Warrant shall be construed
as conferring upon the holder hereof the right to vote or to consent to receive
notice as a stockholder of the Company on any other matters or any rights
whatsoever as a shareholder of the Company.  No dividends or interest
shall be payable or accrued in respect of this Warrant or the interest
represented hereby or the shares purchasable hereunder until, and only to the
extent that, this Warrant shall have been exercised.


    
      
         


      

      
        4

        
          

        

      

      
         


      

    


    6.           Compliance with Securities
Act. The Holder of this Warrant, by acceptance hereof, agrees that this
Warrant is being acquired for its own account and not for any other person or
persons, for investment purposes and that it will not offer, sell, or otherwise
dispose of this Warrant except under circumstances which will not result in a
violation of the Act or any applicable state securities laws.

     

    7.           Limited
Transferability.  The Holder represents that by accepting this
Warrant it understands that this Warrant and any securities obtainable upon
exercise of this Warrant have not been registered for sale under Federal or
state securities laws and are being offered and sold to the Holder pursuant to
one or more exemptions from the registration requirements of such securities
laws.  In the absence of an effective registration of such securities
or an exemption therefrom, any certificates for such securities shall bear the
legend set forth on the first page hereof.  The Holder understands
that it must bear the economic risk of its investment in this Warrant and any
securities obtainable upon exercise of this Warrant for an indefinite period of
time, as this Warrant and such securities have not been registered under Federal
or state securities laws and therefore cannot be sold unless subsequently
registered under such laws, unless an exemption from such registration is
available.  Notwithstanding anything contained herein, the Company
shall, upon written instructions to be delivered to the Company within thirty
(30) business days following the date hereof, transfer all or a portion of this
Warrant to officers, directors, employees and other registered agents or
associated persons of the Holder.

     

    8.           Amendment, Waiver,
etc.  Except as expressly provided herein, neither this Warrant
nor any term hereof may be amended, waived, discharged or terminated other than
by a written instrument signed by the party against whom enforcement of any such
amendment, waiver, discharge or termination is sought.

     

    9.           Notices.  Any
notice, request, or other document required or permitted to be given or
delivered to the Holder hereof or the Company shall be delivered as set forth in
the Purchase Agreement.

     

    10.         Governing
Law.  This Warrant shall be construed and enforced in
accordance with, and the rights of the parties shall be governed by, the laws of
the State of Delaware.

     

    11.         Lost or Stolen
Warrant.  Upon receipt of evidence reasonably satisfactory to
the Company of the loss, theft, destruction, or mutilation of this Warrant and,
in the case of any such loss, theft or destruction, upon receipt of an indemnity
reasonably satisfactory to the Company, or in the case of any such mutilation,
upon surrender and cancellation of such Warrant, the Company, at its expense,
will make and deliver a new Warrant, of like tenor, in lieu of the lost, stolen,
destroyed or mutilated Warrant.

     

    12.         Fractional
Shares.  No fractional shares shall be issued upon exercise of
this Warrant.  The Company shall, in lieu of issuing any fractional
share, pay the Holder entitled to such fraction a sum in cash equal to such
fraction (calculated to the nearest 1/100th of a share) multiplied by the then
effective Exercise Price on the date the Form of Subscription is received by the
Company.

     

    13.         Successors and
Assigns.  This Warrant and the rights evidenced hereby shall
inure to the benefit of and be binding upon the successors of the Company and
the successors and assigns of the Holder.  The provisions of this
Warrant are intended to be for the benefit of all Holders from time to time of
this Warrant, and shall be enforceable by any such Holder.


    
      
         


      

      
        5

        
          

        

      

      
         


      

    


    14.         Severability of
Provisions. In case any one or more of the provisions of this Warrant
shall be invalid or unenforceable in any respect, the validity and
enforceability of the remaining terms and provisions of this Warrant shall not
in any way be affected or impaired thereby and the parties will attempt in good
faith to agree upon a valid and enforceable provision which shall be a
commercially reasonable substitute therefor, and upon so agreeing, shall
incorporate such substitute provision in this Warrant.

     

    15.         Registration of Warrant
Shares.  The Warrant Shares shall be entitled to the same
registration rights granted to the Investors as set forth in those certain
Subscription Agreements between the Company and the Investors and such
registration rights are hereby incorporated by reference for the benefit of the
Holder.

     

    [Signature
Page Follows]


    
      
         


      

      
        6

        
          

        

      

      
         


      

    

     

    Warrant
No. PA-2


     

    IN
WITNESS WHEREOF, the Company has caused this Warrant to be duly executed as of
this 31st day of
March, 2010.

    


    
      
        	
                VENTRUS
      BIOSCIENCES, INC.

              
	 
      	 
      
	
                By:

              	
                /s/ Thom Rowland

              
	
                Name:  Thom
      Rowland

              
	
                Title:  Acting
      President

              


      

    

     

    Signature
Page—Placement Agent Warrant


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    EXHIBIT
A

     

    FORM
OF SUBSCRIPTION

     

    (To be
signed only upon exercise of Warrant)

     

    To:           Ventrus
Biosciences, Inc.

     

    The undersigned is the Holder of
Warrant No. _______ (the “Warrant”) issued by Ventrus
Biosciences, Inc., a Delaware corporation (the “Company”).  Capitalized
terms used herein and not otherwise defined have the respective meanings set
forth in the Warrant.

     

    
      	
               
      

            	
              (a)

            	
              The
      Warrant is currently exercisable to purchase a total of ______________
      Warrant Shares.

            


    

     

    
      	
               
      

            	
              (b)

            	
              The
      undersigned Holder hereby exercises its right to purchase
      _________________ Warrant Shares pursuant to the
  Warrant.

            


    

     

    
      	
               
      

            	
              (c)

            	
              The
      holder shall make payment of the Exercise Price as follows (check
      one):

            


    

     

    _______________
“Cash Exercise” under Section 1

     

    _______________
“Cashless Exercise” under Section 1

     

    
      	
               
      

            	
              (d)

            	
              If
      the holder is making a Cash Exercise, the holder shall pay the sum of
      $____________ to the Company in accordance with the terms of the
      Warrant.

            


    

     

    
      	
               
      

            	
              (e)

            	
              Pursuant
      to this exercise, the Company shall deliver to the holder ______________
      Warrant Shares in accordance with the terms of the
  Warrant.

            


    

     

    
      	
               
      

            	
              (f)

            	
              Following
      this exercise, the Warrant shall be exercisable to purchase a total of
      ______________ Warrant Shares.

            


    

     

    The
undersigned requests that certificates for such shares be issued in the name of,
and delivered
to: ____________________________________________________________________________________________
whose
address
is: ______________________________________________________________________________.

     

    DATED:                                                      

    


    
      
        
          
            
              
                	 
      
	
                        (Signature
      must conform in all respects to name of Holder as specified on the face of
      the Warrant)

                      
	 
      	 
      
	
                        Name:

                      	 
      
	 
      	 
      
	
                        Title:

                      	 
      


              

            

          

        

      

    


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    EXHIBIT
B

    


    FORM
OF ASSIGNMENT

     

    (To
assign the foregoing Warrant, execute this form and supply required
information.  Do not use this form to purchase shares.)

     

    For Value
Received, the foregoing Warrant and all rights evidenced thereby are
hereby assigned to:

     

    Name:                                                                                                                                     
;                                                                                   

    (Please
Print)

    Address:                                                                                                                                    &#
160;                                                                                   

    (Please
Print)

    


    Dated:  __________,
20__

    


    Holder’s

    Signature:                                                                                     

    


    Holder’s

    Address:                                                                                       

     

    NOTE:  The signature
to this Form of Assignment must correspond with the name as it appears on the
face of the Warrant, without alteration or enlargement or any change
whatever.  Officers of corporations and those acting in a fiduciary or
other representative capacity should file proper evidence of authority to assign
the foregoing Warrant.


    
      
         


      

      
         


        
          

        

      

      
         


      

    

    
       

      Warrant
No. PA-3

      


      VENTRUS
BIOSCIENCES, INC.

      COMMON
STOCK WARRANT

       

      THIS
WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “ACT”), OR
UNDER THE SECURITIES LAWS OF ANY STATE.  THIS WARRANT IS SUBJECT TO
RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD
EXCEPT AS PERMITTED UNDER THE ACT AND THE APPLICABLE STATE SECURITIES LAWS,
PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM.  THE ISSUER OF THIS
WARRANT MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO
THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE
WITH THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS.

       

      This
certifies that National Securities Corporation (the “Holder”), its
designees or permitted assigns, at any time or from time to time up to and
including 5:00 p.m. (Eastern Time) on February 26, 2015 (the “Expiration Date”), is
entitled to purchase from Ventrus Biosciences, Inc., a Delaware corporation (the
“Company”),
that number of fully-paid and nonassessable shares (the “Warrant Shares”) of
the Company’s Common Stock, $0.001 par value per share (the “Common Stock”), equal
to 10% of the gross number of securities into which all of those certain
Convertible Promissory Notes (the “Notes”) issued to
investors (“Investors”) pursuant
to the Company’s Confidential Offering Memorandum, dated April 14, 2010 (the
“Memorandum”)
are convertible.  To exercise this
warrant (the “Warrant”), the Holder
must surrender to the Company at its principal office (or at such other location
as the Company may advise the Holder in writing) this Warrant properly endorsed
with the Form of Subscription attached hereto duly completed and signed and with
payment of the aggregate Exercise Price (as defined below, which may take the
form of a “Cashless Exercise” if so indicated in the Exercise Notice pursuant to
Section 1(b) below), for the number of Warrant Shares for which this Warrant is
being exercised determined in accordance with the provisions
hereof.  The per share exercise price (the “Exercise Price”) per
Warrant Share issuable pursuant to this Common Stock Warrant shall be equal to
110% of the price at which securities of the Company are sold in a Qualified IPO
(the “IPO
Price”), payable
in accordance with Section 1(a) hereof. Notwithstanding the foregoing, if a
Qualified IPO does not occur on or before February 26, 2012, then, at the sole
option of the Holder, (x) this Common Stock Warrant will be exercisable for that
number of Warrant Shares equal fifty percent (50%) of the aggregate principal
amount of the Notes purchased by the Investors in the Offering divided by $1.00
and (y) the Exercise Price shall be $1.00. The Exercise Price is subject to
adjustment as provided in Section 3 of this Warrant.  Notwithstanding
the foregoing, the Company shall have the right to redeem this Warrant as
described in Section 4 hereof.  If no Qualified IPO has occurred by
February 26, 2012 and should the Holder elect to adjust the Per Share Warrant
Price to $1.00 herein, he may do so at any time relating to any unexercised
portion of this Warrant by providing written notice to the Company of such
election.  All capitalized terms not defined herein shall have the
meaning assigned to such terms in the Notes.

       

      The
Company shall notify the Holder in writing at least five (5) days prior to the
closing of a Qualified IPO to advise Holder as to the number of Warrant Shares
and Exercise Price of this Warrant.  Upon request of the Holder, upon
return to the Company of this Warrant, or upon receipt of a lost warrant
affidavit in form and substance reasonably acceptable to the Company in the
event this Warrant shall be lost or destroyed, the Company shall provide Holder
with a new Warrant setting forth the number of Warrant Shares underlying this
Warrant and the Exercise Price thereof.  Notices hereunder shall be
sent by the same means and notices sent pursuant to Section 4(b)
hereof.

      


      
        
          
             


          

          
             


            
              

            

          

          
             


          

        

      

       

      This
Warrant is issued subject to the following terms and conditions:

       

      1.           Exercise, Issuance of
Certificates.  Subject to Section 4 hereof, the Holder may
exercise this Warrant at any time or from time to time after the earlier to
occur of a Qualified IPO or the second anniversary of the Initial Closing, and
on or prior to the Expiration Date for all or any part of the Warrant Shares
(but not for a fraction of a share) that may be purchased hereunder, as that
number may be adjusted pursuant to Section 3 of this Warrant.  The
Company agrees that the Warrant Shares purchased under this Warrant shall be and
are deemed to be issued to the Holder hereof as the record owner of such Warrant
Shares as of the close of business on the date on which this Warrant shall have
been surrendered, properly endorsed, the completed and executed Form of
Subscription delivered, and payment made for such Warrant Shares (such date, a
“Date of
Exercise”).  Certificates for the Warrant Shares so purchased,
together with any other securities or property to which the Holder hereof is
entitled upon such exercise, shall be delivered to the Holder hereof by the
Company at the Company’s expense as soon as practicable after the rights
represented by this Warrant have been so exercised, but in any event not later
than ten (10) business days following the Date of Exercise.  In case
of a purchase of less than all the Warrant Shares which may be purchased under
this Warrant, the Company shall cancel this Warrant and execute and deliver to
the Holder hereof within a reasonable time a new Warrant or Warrants of like
tenor for the balance of the Warrant Shares purchasable under the Warrant
surrendered upon such purchase.  Each stock certificate so delivered
shall be registered in the name of such Holder and issued with a legend in
substantially the form of the legend placed on the front of this
Warrant.

       

      (a)           The
Company’s obligations to issue and deliver Warrant Shares in accordance with the
terms hereof are absolute and unconditional, irrespective of any action or
inaction by the Holder to enforce the same.  Nothing herein shall
limit a 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 representing shares of Common Stock upon exercise of
the Warrant  as required pursuant to the terms hereof.

       

      (b)           The
Holder shall pay the Exercise Price in immediately available funds (a “Cash Exercise”); or
the Holder may satisfy its obligation to pay the Exercise Price through a “Cashless Exercise,”
in which event the Company shall issue to the Holder the number of Warrant
Shares determined as follows:

       

      
        	 
      	
                X =
      Y [(A-B)/A]

              
	
                where:

              	 
      
	 
      	
                X =
      the number of Warrant Shares to be issued to the
Holder.

              
	 
      	 
      
	 
      	
                Y =
      the number of Warrant Shares with respect to which this Warrant is being
      exercised (prior to cashless exercise).

              
	 
      	 
      
	 
      	
                A =
      the average of the Closing Prices for the five (5) Trading Days
      immediately prior to (but not including) the Exercise
  Date.

              
	 
      	 
      
	 
      	
                B =
      the Exercise Price.

              


      

      


      
        
          
             


          

          
             


            
              

            

          

          
             


          

        

      

       

      For
purposes of this Section 1, “Closing Prices” for any date,
shall mean the closing price per share of the Common Stock for such date (or the
nearest preceding date) on the primary trading market on which the Common Stock
is then listed or quoted.

       

      For
purposes of Rule 144 promulgated under the Securities Act, it is intended,
understood and acknowledged that the Warrant Shares issued in a cashless
exercise transaction shall be deemed to have been acquired by the Holder, and
the holding period for the Warrant Shares shall be deemed to have commenced, on
the date this Warrant was originally issued to the Holder (provided the
Securities and Exchange Commission continues to take the position that such
treatment is proper at the time of such exercise).

       

      2.           Shares to be Fully Paid;
Reservation of Shares.  The Company covenants and agrees that
all Warrant Shares will, upon issuance and payment of the applicable Exercise
Price, be duly authorized, validly issued, fully paid and nonassessable, and
free of all preemptive rights, liens and encumbrances, except for restrictions
on transfer provided for herein.  The Company shall at all times
reserve and keep available out of its authorized and unissued Common Stock,
solely for the purpose of providing for the exercise of the rights to purchase
all Warrant Shares granted pursuant to this Warrant, such number of shares of
Common Stock as shall, from time to time, be sufficient therefor.

       

      3.           Adjustment of Exercise Price
and Number of Shares.  The Exercise Price and the total number
of Warrant Shares shall be subject to adjustment from time to time upon the
occurrence of certain events described in this Section 3.

       

      (a)           Subdivision or Combination
of Stock.  In the event the outstanding shares of the Company’s
Common Stock shall be increased by a stock dividend payable in Common Stock,
stock split, subdivision, or other similar transaction occurring after the date
hereof into a greater number of shares of Common Stock, the Exercise Price in
effect immediately prior to such subdivision shall be proportionately reduced
and the number of Warrant Shares issuable hereunder proportionately
increased.  Conversely, in the event the outstanding shares of the
Company’s Common Stock shall be decreased by reverse stock split, combination,
consolidation, or other similar transaction occurring after the date hereof into
a lesser number of shares of Common Stock, the Exercise Price in effect
immediately prior to such combination shall be proportionately increased and the
number of Warrant Shares issuable hereunder proportionately
decreased.

       

      (b)           Reclassification.  If
any reclassification of the capital stock of the Company or any reorganization,
consolidation, merger, or any sale, lease, license, exchange or other transfer
(in one transaction or a series of related transactions) of all or substantially
all, of the business and/or assets of the Company (the “Reclassification
Events”) shall be effected in such a way that holders of Common Stock
shall be entitled to receive stock, securities, or other assets or property,
then, as a condition of such Reclassification Event, lawful and adequate
provisions shall be made whereby the Holder hereof shall thereafter have the
right to purchase and receive (in lieu of the shares of Common Stock of the
Company immediately theretofore purchasable and receivable upon the exercise of
the rights represented hereby) such shares of stock, securities, or other assets
or property as may be issued or payable with respect to or in exchange for a
number of outstanding shares of such Common Stock equal to the number of shares
of such stock immediately theretofore purchasable and receivable upon the
exercise of the rights represented hereby.  In any Reclassification
Event, appropriate provision shall be made with respect to the rights and
interests of the Holder of this Warrant to the end that the provisions hereof
(including, without limitation, provisions for adjustments of the Exercise Price
and of the number of Warrant Shares), shall thereafter be applicable, as nearly
as may be, in relation to any shares of stock, securities, or assets thereafter
deliverable upon the exercise hereof.

      


      
        
          
             


          

          
             


            
              

            

          

          
             


          

        

      

       

      (c)           Notice of
Adjustment.  Upon any adjustment of the Exercise Price or any
increase or decrease in the number of Warrant Shares, the Company shall give
written notice thereof, by first class mail postage prepaid, addressed to the
registered Holder of this Warrant at the address of such Holder as shown on the
books of the Company.  The notice shall be prepared and signed by the
Company’s Chief Financial Officer and shall state the Exercise Price resulting
from such adjustment and the increase or decrease, if any, in the number of
shares purchasable at such price upon the exercise of this Warrant, setting
forth in reasonable detail the method of calculation and the facts upon which
such calculation is based.

      


      4.           Redemption of
Warrants.

       

      (a)           Redemption.  This
Warrant may be redeemed at the option of the Company, at any time after the date
the Common Stock is traded on the Over-the-Counter Bulletin Board (the “OTCBB”), Small Cap
Market System or on a national securities exchange, following a period of thirty
(30) consecutive calendar days in which the per share average closing sale price
of the Common Stock equals or exceeds an amount that is twice the Exercise Price, on
notice as set forth in Section 4(b) hereof, and at a redemption price equal to
$0.001 (the “Redemption Price”)
for each Warrant Share purchasable under this Warrant; provided, however, that this
Warrant may not be redeemed by the Company unless the resale of the Warrant
Shares purchasable hereunder has been registered under the Securities Act of
1933, as amended (the “Act”) or are
otherwise freely tradable.  For purposes of this Section, the closing
sale price of the Common Stock shall be determined by the closing price as
reported by the OTCBB so long as the Common Stock is quoted on the OTCBB, and if
the Common Stock is hereafter listed or quoted on the SmallCap Market Systems or
a national securities exchange, shall be determined by the last reported sale
price on the primary exchange or market on which the Common Stock is
traded.

       

      (b)           Notice of
Redemption.  In the case of any redemption of this Warrant, the
Company shall give notice of such redemption to the Holder hereof as provided in
this Section 4(b).  Notice of redemption to the Holder of this Warrant
shall be given in person, by recognized overnight courier, mailed by certified
or registered mail, return receipt requested, or by confirmed facsimile
transmission, to the Holder’s last address and/or facsimile of record with the
Company not less than thirty (30) days prior to the date fixed for
redemption.  Any notice which is given in the manner herein provided
shall be conclusively presumed to have been duly given, whether or not the
Holder receives the notice.  Each such notice shall specify the date
fixed for redemption, the place of redemption and the aggregate Redemption
Price, and shall state that payment of the Redemption Price will be made upon
surrender of this Warrant at such place of redemption, and that if not exercised
by the close of business on the date fixed for redemption, the exercise rights
of the Warrant shall expire unless extended by the Company.  Such
notice shall also state the current Exercise Price and the date on which the
right to exercise the Warrant will expire unless extended by the
Company.

       

      (c)           Payment of Redemption
Price.  If notice of redemption shall have been given as
provided in Section 4(b), the Redemption Price shall, unless the Warrant is
theretofore exercised pursuant to the terms hereof, become due and payable on
the date and at the place stated in such notice.  On and after such
date of redemption, the exercise rights of this Warrant shall expire and this
Warrant shall be null and void on presentation and surrender of this Warrant at
such place of payment in such notice specified, this Warrant shall be paid and
redeemed at the Redemption Price per Warrant Share within ten (10) days
thereafter.

       

      5.           No Voting or Dividend
Rights.  Nothing contained in this Warrant shall be construed
as conferring upon the holder hereof the right to vote or to consent to receive
notice as a stockholder of the Company on any other matters or any rights
whatsoever as a shareholder of the Company.  No dividends or interest
shall be payable or accrued in respect of this Warrant or the interest
represented hereby or the shares purchasable hereunder until, and only to the
extent that, this Warrant shall have been exercised.

      


      
        
          
             


          

          
             


            
              

            

          

          
             


          

        

      

       

      6.           Compliance with Securities
Act. The Holder of this Warrant, by acceptance hereof, agrees that this
Warrant is being acquired for its own account and not for any other person or
persons, for investment purposes and that it will not offer, sell, or otherwise
dispose of this Warrant except under circumstances which will not result in a
violation of the Act or any applicable state securities laws.

       

      7.           Limited
Transferability.  The Holder represents that by accepting this
Warrant it understands that this Warrant and any securities obtainable upon
exercise of this Warrant have not been registered for sale under Federal or
state securities laws and are being offered and sold to the Holder pursuant to
one or more exemptions from the registration requirements of such securities
laws.  In the absence of an effective registration of such securities
or an exemption therefrom, any certificates for such securities shall bear the
legend set forth on the first page hereof.  The Holder understands
that it must bear the economic risk of its investment in this Warrant and any
securities obtainable upon exercise of this Warrant for an indefinite period of
time, as this Warrant and such securities have not been registered under Federal
or state securities laws and therefore cannot be sold unless subsequently
registered under such laws, unless an exemption from such registration is
available.  Notwithstanding anything contained herein, the Company
shall, upon written instructions to be delivered to the Company within thirty
(30) business days following the date hereof, transfer all or a portion of this
Warrant to officers, directors, employees and other registered agents or
associated persons of the Holder.

       

      8.           Amendment, Waiver,
etc.  Except as expressly provided herein, neither this Warrant
nor any term hereof may be amended, waived, discharged or terminated other than
by a written instrument signed by the party against whom enforcement of any such
amendment, waiver, discharge or termination is sought.

       

      9.           Notices.  Any
notice, request, or other document required or permitted to be given or
delivered to the Holder hereof or the Company shall be delivered as set forth in
the Purchase Agreement.

       

      10.           Governing
Law.  This Warrant shall be construed and enforced in
accordance with, and the rights of the parties shall be governed by, the laws of
the State of Delaware.

       

      11.           Lost or Stolen
Warrant.  Upon receipt of evidence reasonably satisfactory to
the Company of the loss, theft, destruction, or mutilation of this Warrant and,
in the case of any such loss, theft or destruction, upon receipt of an indemnity
reasonably satisfactory to the Company, or in the case of any such mutilation,
upon surrender and cancellation of such Warrant, the Company, at its expense,
will make and deliver a new Warrant, of like tenor, in lieu of the lost, stolen,
destroyed or mutilated Warrant.

       

      12.           Fractional
Shares.  No fractional shares shall be issued upon exercise of
this Warrant.  The Company shall, in lieu of issuing any fractional
share, pay the Holder entitled to such fraction a sum in cash equal to such
fraction (calculated to the nearest 1/100th of a share) multiplied by the then
effective Exercise Price on the date the Form of Subscription is received by the
Company.

       

      13.           Successors and
Assigns.  This Warrant and the rights evidenced hereby shall
inure to the benefit of and be binding upon the successors of the Company and
the successors and assigns of the Holder.  The provisions of this
Warrant are intended to be for the benefit of all Holders from time to time of
this Warrant, and shall be enforceable by any such Holder.

      


      
        
          
             


          

          
             


            
              

            

          

          
             


          

        

      

       

      14.           Severability of
Provisions. In case any one or more of the provisions of this Warrant
shall be invalid or unenforceable in any respect, the validity and
enforceability of the remaining terms and provisions of this Warrant shall not
in any way be affected or impaired thereby and the parties will attempt in good
faith to agree upon a valid and enforceable provision which shall be a
commercially reasonable substitute therefor, and upon so agreeing, shall
incorporate such substitute provision in this Warrant.

       

      15.           Registration of Warrant
Shares.  The Warrant Shares shall be entitled to the same
registration rights granted to the Investors as set forth in those certain
Subscription Agreements between the Company and the Investors and such
registration rights are hereby incorporated by reference for the benefit of the
Holder.

       

      [Signature Page
Follows]

       

      
        
          
             


          

          
             


            
              

            

          

          
             


          

        

      

      
         

        Warrant
No. PA-3

      

       

      IN
WITNESS WHEREOF, the Company has caused this Warrant to be duly executed as of
this 6th day of May, 2010.

      


      
        
          	
                  VENTRUS
      BIOSCIENCES, INC.

                
	 
      	 
      
	
                  By:

                	
                  /s/ Thom Rowland

                
	
                  Name:  Thom
      Rowland

                
	
                  Title:  Acting
      President

                


        

      

      


      Signature
Page—Placement Agent Warrant



      
        
           


        

        
           


          
            

          

        

        
           


        

      


      EXHIBIT
A

       

      FORM
OF SUBSCRIPTION

       

      (To be
signed only upon exercise of Warrant)

       

      To:           Ventrus
Biosciences, Inc.

       

      The undersigned is the Holder of
Warrant No. _______ (the “Warrant”) issued by Ventrus
Biosciences, Inc., a Delaware corporation (the “Company”).  Capitalized
terms used herein and not otherwise defined have the respective meanings set
forth in the Warrant.

       

      
        	
                 
      

              	
                (a)

              	
                The
      Warrant is currently exercisable to purchase a total of ______________
      Warrant Shares.

              


      

       

      
        	
                 
      

              	
                (b)

              	
                The
      undersigned Holder hereby exercises its right to purchase
      _________________ Warrant Shares pursuant to the
  Warrant.

              


      

       

      
        	
                 
      

              	
                (c)

              	
                The
      holder shall make payment of the Exercise Price as follows (check
      one):

              


      

       

      _______________
“Cash Exercise” under Section 1

       

      _______________
“Cashless Exercise” under Section 1

       

      
        	
                 
      

              	
                (d)

              	
                If
      the holder is making a Cash Exercise, the holder shall pay the sum of
      $____________ to the Company in accordance with the terms of the
      Warrant.

              


      

       

      
        	
                 
      

              	
                (e)

              	
                Pursuant
      to this exercise, the Company shall deliver to the holder ______________
      Warrant Shares in accordance with the terms of the
  Warrant.

              


      

       

      
        	
                 
      

              	
                (f)

              	
                Following
      this exercise, the Warrant shall be exercisable to purchase a total of
      ______________ Warrant Shares.

              


      

       

      The undersigned requests that certificates for such shares be
issued in the name of, and delivered
to: ____________________________________________________________________________________________
whose
address
is: ______________________________________________________________________________.

       

      DATED:                                                      

      


      
        
          
            
              
                	 
      
	
                        (Signature
      must conform in all respects to name of Holder as specified on the face of
      the Warrant)

                      
	 
      	 
      
	
                        Name:

                      	 
      
	 
      	 
      
	
                        Title:

                      	 
      


              

            

          

        

      


      
        
           


        

        
           


          
            

          

        

        
           


        

      


      EXHIBIT
B

      


      FORM
OF ASSIGNMENT

       

      (To
assign the foregoing Warrant, execute this form and supply required
information.  Do not use this form to purchase shares.)

       

      For Value
Received, the foregoing Warrant and all rights evidenced thereby are
hereby assigned to:

       

      Name:                                                                                                                                    
60;                                                                                   

      (Please
Print)

      Address:                                                                                                                                    
                                                                                    

      (Please
Print)

      


      Dated:  __________,
20__

      


      Holder’s

      Signature:                                                                                     

      


      Holder’s

      Address:                                                                                      

       

      NOTE:  The signature
to this Form of Assignment must correspond with the name as it appears on the
face of the Warrant, without alteration or enlargement or any change
whatever.  Officers of corporations and those acting in a fiduciary or
other representative capacity should file proper evidence of authority to assign
the foregoing Warrant.


      
        
           


        

        
           


          
            

          

        

        
           


        

      

    

     

    Warrant
No. PA-4

     

    VENTRUS
BIOSCIENCES, INC.

    COMMON
STOCK WARRANT

     

    THIS
WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “ACT”), OR
UNDER THE SECURITIES LAWS OF ANY STATE.  THIS WARRANT IS SUBJECT TO
RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD
EXCEPT AS PERMITTED UNDER THE ACT AND THE APPLICABLE STATE SECURITIES LAWS,
PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM.  THE ISSUER OF THIS
WARRANT MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO
THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE
WITH THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS.

     

    
      This
certifies that National Securities Corporation (the “Holder”), its
designees or permitted assigns, at any time or from time to time up to and
including 5:00 p.m. (Eastern Time) on February 26, 2015 (the “Expiration Date”), is
entitled to purchase from Ventrus Biosciences, Inc., a Delaware corporation (the
“Company”),
that number of fully-paid and nonassessable shares (the “Warrant Shares”) of
the Company’s Common Stock, $0.001 par value per share (the “Common Stock”), equal
to 10% of the gross number of securities into which the Convertible Promissory
Note issued on May 6, 2010 to Paramount Biosciences, LLC in the amount of
$2,192,433.33 (the “Note”) is convertible.  To exercise this
warrant (the “Warrant”), the Holder
must surrender to the Company at its principal office (or at such other location
as the Company may advise the Holder in writing) this Warrant properly endorsed
with the Form of Subscription attached hereto duly completed and signed and with
payment of the aggregate Exercise Price (as defined below, which may take the
form of a “Cashless Exercise” if so indicated in the Exercise Notice pursuant to
Section 1(b) below), for the number of Warrant Shares for which this Warrant is
being exercised determined in accordance with the provisions
hereof.  The per share exercise price (the “Exercise Price”) per
Warrant Share issuable pursuant to this Common Stock Warrant shall be equal to
110% of the price at which securities of the Company are sold in a Qualified IPO
(the “IPO
Price”), payable
in accordance with Section 1(a) hereof. Notwithstanding the foregoing, if a
Qualified IPO does not occur on or before February 26, 2012, then, at the sole
option of the Holder, (x) this Common Stock Warrant will be exercisable for that
number of Warrant Shares equal fifty percent (50%) of the aggregate principal
amount of the Notes purchased by the Investors in the Offering divided by $1.00
and (y) the Exercise Price shall be $1.00. The Exercise Price is subject to
adjustment as provided in Section 3 of this Warrant.  Notwithstanding
the foregoing, the Company shall have the right to redeem this Warrant as
described in Section 4 hereof.  If no Qualified IPO has occurred by
February 26, 2012 and should the Holder elect to adjust the Per Share Warrant
Price to $1.00 herein, he may do so at any time relating to any unexercised
portion of this Warrant by providing written notice to the Company of such
election.  All capitalized terms not defined herein shall have the
meaning assigned to such terms in the Notes.

    


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    The
Company shall notify the Holder in writing at least five (5) days prior to the
closing of a Qualified IPO to advise Holder as to the number of Warrant Shares
and Exercise Price of this Warrant.  Upon request of the Holder, upon
return to the Company of this Warrant, or upon receipt of a lost warrant
affidavit in form and substance reasonably acceptable to the Company in the
event this Warrant shall be lost or destroyed, the Company shall provide Holder
with a new Warrant setting forth the number of Warrant Shares underlying this
Warrant and the Exercise Price thereof.  Notices hereunder shall be
sent by the same means and notices sent pursuant to Section 4(b)
hereof.

     

    This
Warrant is issued subject to the following terms and conditions:

     

    
      1.           Exercise, Issuance of
Certificates.  Subject to Section 4 hereof, the Holder may
exercise this Warrant at any time or from time to time after the earlier to
occur of a Qualified IPO or the second anniversary of the Initial Closing, and
on or prior to the Expiration Date for all or any part of the Warrant Shares
(but not for a fraction of a share) that may be purchased hereunder, as that
number may be adjusted pursuant to Section 3 of this Warrant.  The
Company agrees that the Warrant Shares purchased under this Warrant shall be and
are deemed to be issued to the Holder hereof as the record owner of such Warrant
Shares as of the close of business on the date on which this Warrant shall have
been surrendered, properly endorsed, the completed and executed Form of
Subscription delivered, and payment made for such Warrant Shares (such date, a
“Date of
Exercise”).  Certificates for the Warrant Shares so purchased,
together with any other securities or property to which the Holder hereof is
entitled upon such exercise, shall be delivered to the Holder hereof by the
Company at the Company’s expense as soon as practicable after the rights
represented by this Warrant have been so exercised, but in any event not later
than ten (10) business days following the Date of Exercise.  In case
of a purchase of less than all the Warrant Shares which may be purchased under
this Warrant, the Company shall cancel this Warrant and execute and deliver to
the Holder hereof within a reasonable time a new Warrant or Warrants of like
tenor for the balance of the Warrant Shares purchasable under the Warrant
surrendered upon such purchase.  Each stock certificate so delivered
shall be registered in the name of such Holder and issued with a legend in
substantially the form of the legend placed on the front of this
Warrant.

    

     

    (a)           The
Company’s obligations to issue and deliver Warrant Shares in accordance with the
terms hereof are absolute and unconditional, irrespective of any action or
inaction by the Holder to enforce the same.  Nothing herein shall
limit a 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 representing shares of Common Stock upon exercise of
the Warrant  as required pursuant to the terms hereof.

     

    (b)           The
Holder shall pay the Exercise Price in immediately available funds (a “Cash Exercise”); or
the Holder may satisfy its obligation to pay the Exercise Price through a “Cashless Exercise,”
in which event the Company shall issue to the Holder the number of Warrant
Shares determined as follows:

     

    
      	 
      	
              X =
      Y [(A-B)/A]

            
	
              where:

            	 
      
	 
      	
              X =
      the number of Warrant Shares to be issued to the
Holder.

            
	 
      	 
      
	 
      	
              Y =
      the number of Warrant Shares with respect to which this Warrant is being
      exercised (prior to cashless exercise).

            
	 
      	 
      
	 
      	
              A =
      the average of the Closing Prices for the five (5) Trading Days
      immediately prior to (but not including) the Exercise
  Date.

            
	 
      	 
      
	 
      	
              B =
      the Exercise Price.

            


    


    
      
         


      

      
         


        
          

        

      

      
         


      

    

     

    
      For
purposes of this Section 1, “Closing Prices” for any date,
shall mean the closing price per share of the Common Stock for such date (or the
nearest preceding date) on the primary trading market on which the Common Stock
is then listed or quoted.

       

      For
purposes of Rule 144 promulgated under the Securities Act, it is intended,
understood and acknowledged that the Warrant Shares issued in a cashless
exercise transaction shall be deemed to have been acquired by the Holder, and
the holding period for the Warrant Shares shall be deemed to have commenced, on
the date this Warrant was originally issued to the Holder (provided the
Securities and Exchange Commission continues to take the position that such
treatment is proper at the time of such exercise).

       

      2.           Shares to be Fully Paid;
Reservation of Shares.  The Company covenants and agrees that
all Warrant Shares will, upon issuance and payment of the applicable Exercise
Price, be duly authorized, validly issued, fully paid and nonassessable, and
free of all preemptive rights, liens and encumbrances, except for restrictions
on transfer provided for herein.  The Company shall at all times
reserve and keep available out of its authorized and unissued Common Stock,
solely for the purpose of providing for the exercise of the rights to purchase
all Warrant Shares granted pursuant to this Warrant, such number of shares of
Common Stock as shall, from time to time, be sufficient therefor.

       

      3.           Adjustment of Exercise Price
and Number of Shares.  The Exercise Price and the total number
of Warrant Shares shall be subject to adjustment from time to time upon the
occurrence of certain events described in this Section 3.

       

      (a)           Subdivision or Combination
of Stock.  In the event the outstanding shares of the Company’s
Common Stock shall be increased by a stock dividend payable in Common Stock,
stock split, subdivision, or other similar transaction occurring after the date
hereof into a greater number of shares of Common Stock, the Exercise Price in
effect immediately prior to such subdivision shall be proportionately reduced
and the number of Warrant Shares issuable hereunder proportionately
increased.  Conversely, in the event the outstanding shares of the
Company’s Common Stock shall be decreased by reverse stock split, combination,
consolidation, or other similar transaction occurring after the date hereof into
a lesser number of shares of Common Stock, the Exercise Price in effect
immediately prior to such combination shall be proportionately increased and the
number of Warrant Shares issuable hereunder proportionately
decreased.

       

      (b)           Reclassification.  If
any reclassification of the capital stock of the Company or any reorganization,
consolidation, merger, or any sale, lease, license, exchange or other transfer
(in one transaction or a series of related transactions) of all or substantially
all, of the business and/or assets of the Company (the “Reclassification
Events”) shall be effected in such a way that holders of Common Stock
shall be entitled to receive stock, securities, or other assets or property,
then, as a condition of such Reclassification Event, lawful and adequate
provisions shall be made whereby the Holder hereof shall thereafter have the
right to purchase and receive (in lieu of the shares of Common Stock of the
Company immediately theretofore purchasable and receivable upon the exercise of
the rights represented hereby) such shares of stock, securities, or other assets
or property as may be issued or payable with respect to or in exchange for a
number of outstanding shares of such Common Stock equal to the number of shares
of such stock immediately theretofore purchasable and receivable upon the
exercise of the rights represented hereby.  In any Reclassification
Event, appropriate provision shall be made with respect to the rights and
interests of the Holder of this Warrant to the end that the provisions hereof
(including, without limitation, provisions for adjustments of the Exercise Price
and of the number of Warrant Shares), shall thereafter be applicable, as nearly
as may be, in relation to any shares of stock, securities, or assets thereafter
deliverable upon the exercise hereof.

      

        
          
             


          

          
             


            
              

            

          

          
             


          

        

      

    

     

    
      (c)           Notice of
Adjustment.  Upon any adjustment of the Exercise Price or any
increase or decrease in the number of Warrant Shares, the Company shall give
written notice thereof, by first class mail postage prepaid, addressed to the
registered Holder of this Warrant at the address of such Holder as shown on the
books of the Company.  The notice shall be prepared and signed by the
Company’s Chief Financial Officer and shall state the Exercise Price resulting
from such adjustment and the increase or decrease, if any, in the number of
shares purchasable at such price upon the exercise of this Warrant, setting
forth in reasonable detail the method of calculation and the facts upon which
such calculation is based.

      


      4.           Redemption of
Warrants.

       

      (a)           Redemption.  This
Warrant may be redeemed at the option of the Company, at any time after the date
the Common Stock is traded on the Over-the-Counter Bulletin Board (the “OTCBB”), Small Cap
Market System or on a national securities exchange, following a period of thirty
(30) consecutive calendar days in which the per share average closing sale price
of the Common Stock equals or exceeds an amount that is twice the Exercise Price, on
notice as set forth in Section 4(b) hereof, and at a redemption price equal to
$0.001 (the “Redemption Price”)
for each Warrant Share purchasable under this Warrant; provided, however, that this
Warrant may not be redeemed by the Company unless the resale of the Warrant
Shares purchasable hereunder has been registered under the Securities Act of
1933, as amended (the “Act”) or are
otherwise freely tradable.  For purposes of this Section, the closing
sale price of the Common Stock shall be determined by the closing price as
reported by the OTCBB so long as the Common Stock is quoted on the OTCBB, and if
the Common Stock is hereafter listed or quoted on the SmallCap Market Systems or
a national securities exchange, shall be determined by the last reported sale
price on the primary exchange or market on which the Common Stock is
traded.

       

      (b)           Notice of
Redemption.  In the case of any redemption of this Warrant, the
Company shall give notice of such redemption to the Holder hereof as provided in
this Section 4(b).  Notice of redemption to the Holder of this Warrant
shall be given in person, by recognized overnight courier, mailed by certified
or registered mail, return receipt requested, or by confirmed facsimile
transmission, to the Holder’s last address and/or facsimile of record with the
Company not less than thirty (30) days prior to the date fixed for
redemption.  Any notice which is given in the manner herein provided
shall be conclusively presumed to have been duly given, whether or not the
Holder receives the notice.  Each such notice shall specify the date
fixed for redemption, the place of redemption and the aggregate Redemption
Price, and shall state that payment of the Redemption Price will be made upon
surrender of this Warrant at such place of redemption, and that if not exercised
by the close of business on the date fixed for redemption, the exercise rights
of the Warrant shall expire unless extended by the Company.  Such
notice shall also state the current Exercise Price and the date on which the
right to exercise the Warrant will expire unless extended by the
Company.

       

      (c)           Payment of Redemption
Price.  If notice of redemption shall have been given as
provided in Section 4(b), the Redemption Price shall, unless the Warrant is
theretofore exercised pursuant to the terms hereof, become due and payable on
the date and at the place stated in such notice.  On and after such
date of redemption, the exercise rights of this Warrant shall expire and this
Warrant shall be null and void on presentation and surrender of this Warrant at
such place of payment in such notice specified, this Warrant shall be paid and
redeemed at the Redemption Price per Warrant Share within ten (10) days
thereafter.

       

      5.           No Voting or Dividend
Rights.  Nothing contained in this Warrant shall be construed
as conferring upon the holder hereof the right to vote or to consent to receive
notice as a stockholder of the Company on any other matters or any rights
whatsoever as a shareholder of the Company.  No dividends or interest
shall be payable or accrued in respect of this Warrant or the interest
represented hereby or the shares purchasable hereunder until, and only to the
extent that, this Warrant shall have been exercised.

      

        
          
             


          

          
             


            
              

            

          

          
             


          

        

      

    

     

    6.           Compliance with Securities
Act. The Holder of this Warrant, by acceptance hereof, agrees that this
Warrant is being acquired for its own account and not for any other person or
persons, for investment purposes and that it will not offer, sell, or otherwise
dispose of this Warrant except under circumstances which will not result in a
violation of the Act or any applicable state securities laws.

     

    7.           Limited
Transferability.  The Holder represents that by accepting this
Warrant it understands that this Warrant and any securities obtainable upon
exercise of this Warrant have not been registered for sale under Federal or
state securities laws and are being offered and sold to the Holder pursuant to
one or more exemptions from the registration requirements of such securities
laws.  In the absence of an effective registration of such securities
or an exemption therefrom, any certificates for such securities shall bear the
legend set forth on the first page hereof.  The Holder understands
that it must bear the economic risk of its investment in this Warrant and any
securities obtainable upon exercise of this Warrant for an indefinite period of
time, as this Warrant and such securities have not been registered under Federal
or state securities laws and therefore cannot be sold unless subsequently
registered under such laws, unless an exemption from such registration is
available.  Notwithstanding anything contained herein, the Company
shall, upon written instructions to be delivered to the Company within thirty
(30) business days following the date hereof, transfer all or a portion of this
Warrant to officers, directors, employees and other registered agents or
associated persons of the Holder.

     

    8.           Amendment, Waiver,
etc.  Except as expressly provided herein, neither this Warrant
nor any term hereof may be amended, waived, discharged or terminated other than
by a written instrument signed by the party against whom enforcement of any such
amendment, waiver, discharge or termination is sought.

     

    9.           Notices.  Any
notice, request, or other document required or permitted to be given or
delivered to the Holder hereof or the Company shall be delivered as set forth in
the Purchase Agreement.

     

    10.         Governing
Law.  This Warrant shall be construed and enforced in
accordance with, and the rights of the parties shall be governed by, the laws of
the State of Delaware.

     

    11.         Lost or Stolen
Warrant.  Upon receipt of evidence reasonably satisfactory to
the Company of the loss, theft, destruction, or mutilation of this Warrant and,
in the case of any such loss, theft or destruction, upon receipt of an indemnity
reasonably satisfactory to the Company, or in the case of any such mutilation,
upon surrender and cancellation of such Warrant, the Company, at its expense,
will make and deliver a new Warrant, of like tenor, in lieu of the lost, stolen,
destroyed or mutilated Warrant.

     

    12.         Fractional
Shares.  No fractional shares shall be issued upon exercise of
this Warrant.  The Company shall, in lieu of issuing any fractional
share, pay the Holder entitled to such fraction a sum in cash equal to such
fraction (calculated to the nearest 1/100th of a share) multiplied by the then
effective Exercise Price on the date the Form of Subscription is received by the
Company.

     

    13.         Successors and
Assigns.  This Warrant and the rights evidenced hereby shall
inure to the benefit of and be binding upon the successors of the Company and
the successors and assigns of the Holder.  The provisions of this
Warrant are intended to be for the benefit of all Holders from time to time of
this Warrant, and shall be enforceable by any such Holder.


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    14.         Severability of
Provisions. In case any one or more of the provisions of this Warrant
shall be invalid or unenforceable in any respect, the validity and
enforceability of the remaining terms and provisions of this Warrant shall not
in any way be affected or impaired thereby and the parties will attempt in good
faith to agree upon a valid and enforceable provision which shall be a
commercially reasonable substitute therefor, and upon so agreeing, shall
incorporate such substitute provision in this Warrant.

     

    15.         Registration of Warrant
Shares.  The Warrant Shares shall be entitled to the same
registration rights granted to the Investors as set forth in those certain
Subscription Agreements between the Company and the Investors and such
registration rights are hereby incorporated by reference for the benefit of the
Holder.

     

    [Signature
Page Follows]


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    Warrant
No. PA-4

     

    IN
WITNESS WHEREOF, the Company has caused this Warrant to be duly executed as of
this 6th day of May, 2010.

     

    
      
        	
                VENTRUS
      BIOSCIENCES, INC.

              
	 
      	 
      
	
                By:

              	
                /s/ Thom Rowland

              
	 
      	
                Name:  Thom
      Rowland

              
	 
      	
                Title:  Acting
      President

              


      

    

    


    Signature
Page—Placement Agent Warrant


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    EXHIBIT
A

     

    FORM
OF SUBSCRIPTION

     

    (To be
signed only upon exercise of Warrant)

     

    To:         Ventrus
Biosciences, Inc.

     

    The undersigned is the Holder of
Warrant No. _______ (the “Warrant”) issued by Ventrus
Biosciences, Inc., a Delaware corporation (the “Company”).  Capitalized
terms used herein and not otherwise defined have the respective meanings set
forth in the Warrant.

     

    
      	
               
      

            	
              (a)

            	
              The
      Warrant is currently exercisable to purchase a total of ______________
      Warrant Shares.

            


    

     

    
      	
               
      

            	
              (b)

            	
              The
      undersigned Holder hereby exercises its right to purchase
      _________________ Warrant Shares pursuant to the
  Warrant.

            


    

     

    
      	
               
      

            	
              (c)

            	
              The
      holder shall make payment of the Exercise Price as follows (check
      one):

            


    

     

    _______________
“Cash Exercise” under Section 1

     

    _______________
“Cashless Exercise” under Section 1

     

    
      	
               
      

            	
              (d)

            	
              If
      the holder is making a Cash Exercise, the holder shall pay the sum of
      $____________ to the Company in accordance with the terms of the
      Warrant.

            


    

     

    
      	
               
      

            	
              (e)

            	
              Pursuant
      to this exercise, the Company shall deliver to the holder ______________
      Warrant Shares in accordance with the terms of the
  Warrant.

            


    

     

    
      	
               
      

            	
              (f)

            	
              Following
      this exercise, the Warrant shall be exercisable to purchase a total of
      ______________ Warrant Shares.

            


    

     

    The
undersigned requests that certificates for such shares be issued in the name of,
and delivered
to: ____________________________________________________________________________________________

    whose
address is:
____________________________________________________________________________________.

     

    DATED:                                                      

    


    
      
        	
                  

              
	
                (Signature
      must conform in all respects to name of

              
	
                Holder
      as specified on the face of the Warrant)

              
	 
      
	
                Name:

              	
                  

              
	 
      	 
      
	
                Title:

              	
                  

              


      

    


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    EXHIBIT
B

    


    FORM
OF ASSIGNMENT

     

    (To
assign the foregoing Warrant, execute this form and supply required
information.  Do not use this form to purchase shares.)

     

    For Value
Received, the foregoing Warrant and all rights evidenced thereby are
hereby assigned to:

     

    
      
        
          
            	
                    Name:

                  	 
      
	
                    (Please
      Print)

                  
	 
	
                    Address: 

                  	 
      
	
                    (Please
      Print)

                  


          

        

      

    

    


    Dated:  __________,
20__

    


    
      
        	
                Holder’s

              	 
      
	
                Signature:

              	
                  

              
	 
      	 
      
	
                Holder’s

              	 
      
	
                Address: 

              	
                  

              


      

    

    


    NOTE:  The signature
to this Form of Assignment must correspond with the name as it appears on the
face of the Warrant, without alteration or enlargement or any change
whatever.  Officers of corporations and those acting in a fiduciary or
other representative capacity should file proper evidence of authority to assign
the foregoing Warrant.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    AMENDMENT
TO WARRANTS NOS. PA-1, PA-2, PA-3 and PA-4

    


    This Amendment, dated as of October 28,
2010, is to the Warrants for Purchase of Shares of Common Stock numbered PA-1,
PA-2, PA-3 and PA-4 (the “Warrants”), between National Securities Corporation
(“Holder”), and Ventrus BioSciences, Inc., a Delaware corporation
(“Ventrus”).

    


    To
facilitate a transaction benefiting both Ventrus and the Holder and other good
and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties hereto agree as follows:

    


    1.           Definitions.  Except
as otherwise defined in this Amendment, the capitalized terms used in this
Amendment will have the meanings ascribed thereto in the Warrants.

    


    2.           Amendment.  The
third sentence in the first paragraph of each of the Warrants is hereby deleted
and replaced in its entirety with the following sentence:

    


    The per
share exercise price (the “Exercise Price”) per
Warrant Share issuable pursuant to this Common Stock Warrant shall be equal to
165% of the price at which securities of the Company are sold in a Qualified IPO
(the “IPO
Price”), payable
in accordance with Section 1(a) hereof.

    


    3.           Miscellaneous.

    


    (a)           Except
as expressly amended as provided above, the Warrants remain unmodified and in
full force and effect and is hereby renewed, ratified and affirmed by
Ventrus.

    


    (b)           This
Amendment may be executed in one or more counterparts, each of which shall be
deemed an original.  Any party may execute this Amendment and deliver
its signature page by pdf or facsimile, which pdf or facsimile signature shall
be deemed to constitute an original for all purposes.

    


    IN WITNESS WHEREOF, the parties have
signed this Amendment as of the day and year first above written.

    


    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              	
                                      VENTRUS
      BIOSCIENCES, INC.

                                    	
                                        

                                    	
                                      NATIONAL
      SECURITIES

                                      CORPORATION

                                    
	 
      	 
      	 
      
	
                                      By:

                                    	/s/
      Russell H. Ellison  	 
      	
                                      By:

                                    	/s/
      Jonathan C. Rich  
	 	 	 	 	 
	
                                      Name:

                                    	Russell
      H. Ellison  	 
      	
                                      Name:

                                    	Jonathan
      C. Rich  
	 	
                                        
      

                                    	 	 	 
	
                                      Title:

                                    	CEO 
      	 
      	
                                      Title:

                                    	EVP