Exhibit 10.1


 


OPEN
MARKET SALE AGREEMENTSM


 


July 29,
2020


 


JEFFERIES
LLC

520 Madison Avenue





New
York, New York 10022


 


Ladies
and Gentlemen:


 


Milestone
Pharmaceuticals Inc., a corporation continued under the laws of the Province of Québec, Canada (the “Company”),
proposes, subject to the terms and conditions stated herein, to issue and sell from time to time through Jefferies LLC, as sales
agent and/or principal (the “Agent”), the Company’s common shares without par value (the “Common
Shares”), having an aggregate offering price of up to $50,000,000 on the terms set forth in this agreement (this “Agreement”).


 


Section 1. DEFINITIONS


 


(a)            Certain
Definitions. For purposes of this Agreement, capitalized terms used herein and not otherwise defined shall have the following
respective meanings:


 


“Affiliate”
of a Person means another Person that directly or indirectly, through one or more intermediaries, controls, is controlled by,
or is under common control with, such first- mentioned Person. The term “control” (including the terms “controlling,”
“controlled by” and “under common control with”) means the possession, direct or indirect, of the power
to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities,
by contract or otherwise.


 


“Agency
Period” means the period commencing on the date of this Agreement and expiring on the earliest to occur of (x) the
date on which the Agent shall have placed the Maximum Program Amount pursuant to this Agreement and (y) the date this Agreement
is terminated pursuant to ‎Section 7.


 


“AMF”
means the Autorité des marchés financiers (Québec).


 


“Commission”
means the U.S. Securities and Exchange Commission.


 


“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission thereunder.


 


“Floor
Price” means the minimum price set by the Company in the Issuance Notice below which the Agent shall not sell Shares
during the applicable period set forth in the Issuance Notice, which may be adjusted by the Company at any time during the period
set forth in the Issuance Notice by delivering written notice of such change to the Agent and which in no event shall be less
than $1.00 without the prior written consent of the Agent, which consent may be withheld in the Agent’s sole discretion.


 





 






SM
“Open Market Sale Agreement” is a service mark of Jefferies LLC


 






     


     


    

 


“Issuance
Amount” means the aggregate Sales Price of the Shares to be sold by the Agent pursuant to any Issuance Notice.


 


“Issuance
Notice” means a written notice delivered to the Agent by the Company in accordance with this Agreement in the form attached
hereto as Exhibit A that is executed by its Chief Executive Officer, President or Chief Financial Officer.


 


“Issuance
Notice Date” means any Trading Day during the Agency Period that an Issuance Notice is delivered pursuant to ‎Section 3(b)(i).


 


“Issuance
Price” means the Sales Price less the Selling Commission.


 


“Maximum
Program Amount” means Common Shares with an aggregate Sales Price of the lesser of (a) the number or dollar amount
of Common Shares registered under the effective Registration Statement (defined below) pursuant to which the offering is being
made, (b) the number or dollar amount of Common Shares permitted to be sold under Form S-3 (including General Instruction
I.B.6 thereof, if applicable), or (c) the number or dollar amount of Common Shares for which the Company has filed a Prospectus
(defined below).


 


“Person”
means an individual or a corporation, partnership, limited liability company, trust, incorporated or unincorporated association,
joint venture, joint stock company, governmental authority or other entity of any kind.


 


“Principal
Market” means the Nasdaq Global Select Market or such other national securities exchange on which the Common Shares,
including any Shares, are then listed.


 


“Sales
Price” means the actual sale execution price of each Share placed by the Agent pursuant to this Agreement.


 


“Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations of the Commission thereunder.


 


“Selling
Commission” means three percent (3.0%) of the gross proceeds of Shares sold pursuant to this Agreement, or as otherwise
agreed between the Company and the Agent with respect to any Shares sold pursuant to this Agreement.


 


“Settlement
Date” means the second business day following each Trading Day during the
period set forth in the Issuance Notice on which Shares are sold pursuant to this Agreement, when the Company shall deliver to
the Agent the amount of Shares sold on such Trading Day and the Agent shall deliver to the Company the Issuance Price received
on such sales.


 


“Shares”
shall mean the Company’s Common Shares issued or issuable pursuant to this Agreement.


 






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“Trading
Day” means any day on which the Principal Market is open for trading.


 





Section 2. REPRESENTATIONS
AND WARRANTIES OF THE COMPANY


 


The
Company represents and warrants to, and agrees with, the Agent that as of (1) the date of this Agreement, (2) each Issuance
Notice Date, (3) each Settlement Date, (4) each Triggering Event Date with respect to which the Company is required
to deliver a certificate pursuant to Section 4(p) and (5) each Time of Sale (each of the times referenced
above is referred to herein as a “Representation Date”), except as may be disclosed in the Prospectus (including
any documents incorporated by reference therein and any supplements thereto) on or before a Representation Date:


 


(a)            Registration
Statement. The Company has prepared and filed with the Commission a shelf registration statement on Form S-3 (File
No. 333-239318) that contains a base prospectus (the “Base Prospectus”). Such registration statement registers
the issuance and sale by the Company of the Shares under the Securities Act. The Company may file one or more additional registration
statements from time to time that will contain a base prospectus and related prospectus or prospectus supplement, if applicable,
with respect to the Shares. Except where the context otherwise requires, such registration statement(s), including any information
deemed to be a part thereof pursuant to Rule 430B under the Securities Act, including all financial statements, exhibits
and schedules thereto and all documents incorporated or deemed to be incorporated therein by reference pursuant to Item 12 of
Form S-3 under the Securities Act as from time to time amended or supplemented, is herein referred to as the “Registration
Statement,” and the prospectus constituting a part of such registration statement(s), together with any prospectus supplement
filed with the Commission pursuant to Rule 424(b) under the Securities Act relating to a particular issuance of the
Shares, including all documents incorporated or deemed to be incorporated therein by reference pursuant to Item 12 of Form S-3
under the Securities Act, in each case, as from time to time amended or supplemented, is referred to herein as the “Prospectus,”
except that if any revised prospectus is provided to the Agent by the Company for use in connection with the offering of the Shares
that is not required to be filed by the Company pursuant to Rule 424(b) under the Securities Act, the term “Prospectus”
shall refer to such revised prospectus from and after the time it is first provided to the Agent for such use. The Registration
Statement at the time it originally became effective is herein called the “Original Registration Statement.”
As used in this Agreement, the terms “amendment” or “supplement” when applied to the Registration Statement
or the Prospectus shall be deemed to include the filing by the Company with the Commission of any document under the Exchange
Act after the date hereof that is or is deemed to be incorporated therein by reference.


 


All
references in this Agreement to financial statements and schedules and other information which is “contained,” “included”
or “stated” in or “part of” the Registration Statement or the Prospectus (and all other references of
like import) shall be deemed to mean and include all such financial statements and schedules and other information which is or
is deemed to be incorporated by reference in or otherwise deemed under the Securities Act to be a part of or included in the Registration
Statement or the Prospectus, as the case may be, as of any specified date; and all references in this Agreement to amendments
or supplements to the Registration Statement or the Prospectus shall be deemed to mean and include, without limitation, the filing
of any document under the Exchange Act which is or is deemed to be incorporated by reference in or otherwise deemed under the
Securities Act to be a part of or included in the Registration Statement or the Prospectus, as the case may be, as of any specified
date. The Company’s obligations under this Agreement to furnish, provide or
deliver or make available copies of any report or statement shall be deemed satisfied if the same is filed with the Commission
through its Electronic Data Gathering, Analysis and Retrieval system (“EDGAR”).


 






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At
the time the Original Registration Statement was declared effective and at the time the Company’s most recent annual report
on Form 10-K was filed with the Commission, if later, the Company met the then-applicable requirements for use of Form S-3
under the Securities Act. During the Agency Period, each time the Company files an annual report on Form 10-K the Company
will meet the then-applicable requirements for use of Form S-3 under the Securities Act.


 


(b)            Compliance
with Registration Requirements. The Original Registration Statement and any registration statement filed under Rule 462(b) under
the Securities Act (a “Rule 462(b) Registration Statement”) have been declared effective by the Commission
or become effective under the Securities Act, if any. The Company has complied to the Commission’s satisfaction with all
requests of the Commission for additional or supplemental information, if any. No stop order suspending the effectiveness of the
Registration Statement or any Rule 462(b) Registration Statement is in effect and no proceedings for such purpose have
been instituted or are pending or, to the Company’s knowledge, are contemplated or threatened by the Commission.


 


The
Prospectus when filed complied in all material respects with the Securities Act and, if filed with the Commission through EDGAR
(except as may be permitted by Regulation S-T under the Securities Act), was identical to the copy thereof delivered to the
Agent for use in connection with the issuance and sale of the Shares. Each of the Registration Statement, any Rule 462(b) Registration
Statement and any post-effective amendment or supplement thereto, at the time it became or becomes effective and at each Representation
Date, complied and will comply in all material respects with the Securities Act and did not and will not contain any untrue statement
of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein
not misleading. As of the date of this Agreement, the Prospectus and any Free Writing Prospectus (as defined below) considered
together (collectively, the “Time of Sale Information”) did not contain any untrue statement of a material
fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which
they were made, not misleading. The Prospectus as of its date, did not, and at each Settlement Date, the Prospectus, as amended
or supplemented, will not, contain any untrue statement of a material fact or omit to state a material fact necessary in order
to make the statements therein, in the light of the circumstances under which they were made, not misleading. The representations
and warranties set forth in the three immediately preceding sentences do not apply to statements in or omissions from the Registration
Statement, any Rule 462(b) Registration Statement, or any post-effective amendment or supplement thereto, or the Prospectus,
or any amendments or supplements thereto, or the Time of Sale Information, made in reliance upon and in conformity with information
relating to the Agent furnished to the Company in writing by the Agent expressly for use therein, it being understood and agreed
that the only such information furnished by the Agent to the Company consists of the information described in ‎Section 6
below. There are no contracts or other documents required to be described in the Prospectus or to be filed as exhibits to
the Registration Statement which have not been described or filed as required. The Registration Statement and the offer and sale
of the Shares as contemplated hereby meet the requirements of Rule 415 under the Securities Act and comply in all material
respects with said rule.


 






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(c)            Ineligible
Issuer Status. The Company is not an “ineligible issuer” in connection with the offering of the Shares pursuant
to Rules 164, 405 and 433 under the Securities Act. Any Free Writing Prospectus that the Company is required to file pursuant
to Rule 433(d) under the Securities Act has been, or will be, filed with the Commission in accordance with the requirements
of the Securities Act. Each Free Writing Prospectus that the Company has filed, or is required to file, pursuant to Rule 433(d) under
the Securities Act or that was prepared by or on behalf of or used or referred to by the Company complies or will comply in all
material respects with the requirements of Rule 433 under the Securities Act including timely filing with the Commission
or retention where required and legending, and each such Free Writing Prospectus, as of its issue date and at all subsequent times
through the completion of the issuance and sale of the Shares did not, does not and will not include any information that conflicted,
conflicts with or will conflict with the information contained in the Registration Statement or the Prospectus, including any
document incorporated by reference therein. Except for the Free Writing Prospectuses, if any, and electronic road shows, if any,
furnished to you before first use, the Company has not prepared, used or referred to, and will not, without your prior consent,
which consent shall not be unreasonably withheld or delayed, prepare, use or refer to, any Free Writing Prospectus.


 


(d)            Incorporated
Documents. The documents incorporated or deemed to be incorporated by reference in the Registration Statement and the Prospectus,
at the time they were filed with the Commission, complied in all material respects with the requirements of the Exchange Act,
as applicable, and, when read together with the other information in the Prospectus, do not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.


 


(e)            Exchange
Act Compliance. The documents incorporated or deemed to be incorporated by reference in the Prospectus, at the time they were
or hereafter are filed with the Commission, and any Free Writing Prospectus or amendment or supplement thereto complied and will
comply in all material respects with the requirements of the Exchange Act, and, when read together with the other information
in the Prospectus, at the time the Registration Statement and any amendments thereto become effective and at each Time of Sale
(as defined below), as the case may be, will not contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they
were made, not misleading.


 


(f)             Statistical
and Market-Related Data. All statistical, demographic and market-related data included in the Registration Statement or the
Prospectus are based on or derived from sources that the Company believes, after reasonable inquiry, to be reliable and accurate.
To the extent required, the Company has obtained the written consent for the use of such data from such sources.


 


(g)           Disclosure
Controls and Procedures; Deficiencies in or Changes to Internal Control Over Financial Reporting. The Company has established
and maintains disclosure controls and procedures (as defined in Rules 13a-15 and 15d-15 under the Exchange Act), which (i) are
designed to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to
the Company’s principal executive officer and its principal financial officer by others within those entities, particularly
during the periods in which the periodic reports required under the Exchange Act are being prepared; (ii) have been evaluated
by management of the Company for effectiveness as of the end of the Company’s most recent fiscal quarter; and (iii) are
effective in all material respects to perform the functions for which they were established. Since the end of the Company’s
most recent audited fiscal year, there have been no significant deficiencies or material weaknesses in the Company’s internal
control over financial reporting (whether or not remediated) and no change in the Company’s internal control over financial
reporting that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over
financial reporting. The Company is not aware of any change in its internal control over financial reporting that has occurred
during its most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Company’s
internal control over financial reporting.





 



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(h)           This
Agreement. This Agreement has been duly authorized, executed and delivered by the Company.


 


(i)             Authorization
of the Shares. The Shares have been duly authorized for issuance and sale pursuant to this Agreement and, when issued and
delivered by the Company against payment therefor pursuant to this Agreement, will be validly issued, fully paid and nonassessable,
and the issuance and sale of the Shares is not subject to any preemptive rights, rights of first refusal or other similar rights
to subscribe for or purchase the Shares.


 


(j)             No
Applicable Registration or Other Similar Rights. There are no persons with registration or other similar rights to have any
equity or debt securities registered for sale under the Registration Statement or included in the offering contemplated by this
Agreement, except for such rights as have been duly waived.


 


(k)            No
Material Adverse Change. Except as otherwise disclosed in the Registration Statement and the Prospectus, subsequent to the
respective dates as of which information is given in the Registration Statement and the Prospectus: (i) there has been no
material adverse change, or any development that could be expected to result in a material adverse change, in (A) the condition,
financial or otherwise, or in the earnings, business, properties, operations, operating results, assets, liabilities or prospects,
whether or not arising from transactions in the ordinary course of business, of the Company and the Subsidiary (as defined below),
considered as one entity or (B) the ability of the Company to consummate the transactions contemplated by this Agreement
or perform its obligations hereunder (any such change being referred to herein as a “Material Adverse Change”);
(ii) the Company and the Subsidiary, considered as one entity, have not incurred any material liability or obligation, indirect,
direct or contingent, including without limitation any losses or interference with their business from fire, explosion, flood,
earthquakes, accident or other calamity, whether or not covered by insurance, or from any strike, labor dispute or court or governmental
action, order or decree, that are material, individually or in the aggregate, to the Company and the Subsidiary, considered as
one entity, and have not entered into any transactions not in the ordinary course of business; and (iii) there has not been
any material decrease in the share capital or any material increase in any short-term or long-term indebtedness of the Company
or the Subsidiary and there has been no dividend or distribution of any kind declared, paid or made by the Company or, except
for dividends paid to the Company, by the Subsidiary on any class of capital stock, or any repurchase or redemption by the Company
or the Subsidiary of any class of share capital or capital stock, as applicable.


 






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(l)             Independent
Accountants. PricewaterhouseCoopers LLP, which has expressed its opinion with respect to the financial statements (which term
as used in this Agreement includes the related notes thereto) filed with the Commission as a part of the Registration Statement
and the Prospectus, is (i) an independent registered public accounting firm as required by the Securities Act, the Exchange
Act, and the rules of the Public Company Accounting Oversight Board (“PCAOB”), (ii) in compliance
with the applicable requirements relating to the qualification of accountants under Rule 2-01 of Regulation S-X under the
Securities Act and (iii) a registered public accounting firm as defined by the PCAOB whose registration has not been suspended
or revoked and who has not requested such registration to be withdrawn.


 


(m)           Financial
Statements. The financial statements filed with the Commission as a part of the Registration Statement and the Prospectus
present fairly, in all material respects, the consolidated financial position of the Company and the Subsidiary as of the dates
indicated and the results of their operations, changes in shareholders’ equity and cash flows for the periods specified.
Such financial statements have been prepared in conformity with generally accepted accounting principles as applied in the United
States applied on a consistent basis throughout the periods involved, except as may be expressly stated in the related notes thereto,
and except in the case of unaudited financial statements, which are subject to normal and recurring year-end adjustments and do
not contain all footnotes as permitted by the applicable rules of the Commission. The interactive data in eXtensible Business
Reporting Language included or incorporated by reference in the Registration Statement fairly presents the information called
for in all material respects and has been prepared in accordance with the Commission’s rules and guidelines applicable
thereto. No other financial statements or supporting schedules are required to be included in the Registration Statement or the
Prospectus. To the Company’s knowledge, no person who has been suspended or barred from being associated with a registered
public accounting firm, or who has failed to comply with any sanction pursuant to Rule 5300 promulgated by the PCAOB, has
participated in or otherwise aided the preparation of, or audited, the financial statements or other financial data filed with
the Commission as a part of the Registration Statement and the Prospectus.


 


(n)            Company’s
Accounting System. The Company and the Subsidiary make and keep books and records that are accurate in all material respects
and maintain a system of internal accounting controls designed to provide reasonable assurance that: (i) transactions are
executed in accordance with management’s general or specific authorization; (ii) transactions are recorded as necessary
to permit preparation of financial statements in conformity with generally accepted accounting principles as applied in the United
States and to maintain accountability for assets; (iii) access to assets is permitted only in accordance with management’s
general or specific authorization; (iv) the recorded accountability for assets is compared with existing assets at reasonable
intervals and appropriate action is taken with respect to any differences; and (v) the interactive data in eXtensible Business
Reporting Language included or incorporated by reference in the Registration Statement and the Prospectus fairly presents the
information called for in all material respects and is prepared in accordance with the Commission's rules and guidelines
applicable thereto.


 






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(o)            Incorporation
and Valid Existence of the Company. The Company has been duly continued and is validly existing as a corporation under
the Business Corporations Act (Québec) and has the corporate power and authority to own, lease and operate its properties
and to conduct its business as described in the Registration Statement and the Prospectus and to enter into and perform its obligations
under this Agreement.








 


(p)            Subsidiaries.
The Company has no “significant subsidiaries” (as defined in Rule 1-02 of Regulation S-X under the Securities
Act). The Company has no subsidiaries (for purposes of this Agreement, as defined in Rule 405 under the Securities Act) other
than Milestone Pharmaceuticals USA, Inc., a Delaware corporation (the “Subsidiary”). The Subsidiary has
been duly incorporated and is validly existing as a corporation in good standing under the laws of the State of Delaware and has
the power and authority (corporate or other) to own, lease and operate its properties and to conduct its business as described
in the Registration Statement and the Prospectus. The Subsidiary is duly qualified as a foreign corporation to transact business
and is in good standing in the State of North Carolina and each other jurisdiction in which such qualification is required, whether
by reason of the ownership or leasing of property or the conduct of business, except where the failure to be so qualified or in
good standing would not reasonably be expected, individually or in the aggregate, to result in a Material Adverse Change. All
of the issued and outstanding shares of capital stock or other equity or ownership interests of the Subsidiary have been duly
authorized and validly issued, are fully paid and nonassessable and are owned by the Company directly free and clear of any security
interest, mortgage, pledge, lien, encumbrance or adverse claim. None of the outstanding capital stock in the Subsidiary was issued
in violation of preemptive or similar rights of any security holder of the Subsidiary. The organizational documents of the Subsidiary
comply in all material respects with the requirements of its jurisdiction of incorporation and are in full force and effect. The
Company does not own or control, directly or indirectly, any corporation, association or other entity other than the Subsidiary.


 


(q)            Capitalization
and Other Share Capital Matters. The authorized, issued and outstanding share capital of the Company is as set forth in the
Registration Statement and the Prospectus. The Common Shares (including the Shares) conform in all material respects to the description
thereof contained in the Prospectus. All of the issued and outstanding Common Shares have been duly authorized and validly issued,
are fully paid and nonassessable and have been issued in compliance with all U.S. and Canadian federal, state and provincial securities
laws. None of the outstanding Common Shares was issued in violation of any preemptive rights, rights of first refusal or other
similar rights to subscribe for or purchase securities of the Company. There are no authorized or outstanding options, warrants,
preemptive rights, rights of first refusal or other rights to purchase, or equity or debt securities convertible into or exchangeable
or exercisable for, any share capital of the Company or the Subsidiary other than those described in the Registration Statement
and the Prospectus. The descriptions of the Company’s share option, share bonus and other share plans or arrangements, and
the options or other rights granted thereunder, set forth in the Registration Statement and the Prospectus accurately and fairly
presents, in all material respects, the information required to be shown with respect to such plans, arrangements, options and
rights.


 


(r)            Stock
Exchange Listing. The Common Shares are registered pursuant to Section 12(b) or 12(g) of the Exchange Act and
are listed on the Principal Market, and the Company has taken no action designed to, or likely to have the effect of, terminating
the registration of the Common Shares under the Exchange Act or delisting the Common Shares from the Principal Market, nor has
the Company received any notification that the Commission or the Principal Market is contemplating terminating such registration
or listing. To the Company’s knowledge, it is in compliance with all applicable listing requirements of the Principal Market.


 






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(s)            Non-Contravention
of Existing Instruments; No Further Authorizations or Approvals Required. Neither the Company nor the Subsidiary is in violation
of its articles or by-laws or similar organizational documents, as applicable, or is in default (or, with the giving of notice
or lapse of time, would be in default) (“Default”) under any indenture, loan, credit agreement, note, lease,
license agreement, contract, franchise or other instrument (including, without limitation, any pledge agreement, security agreement,
mortgage or other instrument or agreement evidencing, guaranteeing, securing or relating to indebtedness) to which the Company
or the Subsidiary is a party or by which it or any of them may be bound, or to which any of their respective properties or assets
are subject (each, an “Existing Instrument”), except for such Defaults as could not be expected, individually
or in the aggregate, to result in a Material Adverse Change. The Company’s execution, delivery and performance of this Agreement,
consummation of the transactions contemplated hereby and by the Registration Statement and the Prospectus and the issuance and
sale of the Shares (including the use of proceeds from the sale of the Shares as described in the Registration Statement and the
Prospectus under the caption “Use of Proceeds”) (i) have been duly authorized by all necessary corporate action
and will not result in any violation of the provisions of the articles or by-laws or similar organizational documents, as applicable,
of the Company or the Subsidiary (ii) will not conflict with or constitute a breach of, or Default or a Debt Repayment Triggering
Event (as defined below) under, or result in the creation or imposition of any lien, charge or encumbrance upon any property or
assets of the Company or the Subsidiary pursuant to, or require the consent of any other party to, any Existing Instrument and
(iii) will not result in any violation of any law, administrative regulation or administrative or court decree applicable
to the Company or the Subsidiary, except in the case of (ii) and (iii) as would not reasonably be expected, individually
or in the aggregate, to result in a Material Adverse Change. No consent, approval, authorization or other order of, or registration
or filing with, any court or other governmental or regulatory authority or agency, is required for the Company’s execution,
delivery and performance of this Agreement and consummation of the transactions contemplated hereby and by the Registration Statement
and the Prospectus, except such as have been obtained or made by the Company and are in full force and effect under the Securities
Act and such as may be required under applicable state securities or blue sky laws or FINRA (as defined below). As used herein,
a “Debt Repayment Triggering Event” means any event or condition which gives, or with the giving of notice
or lapse of time would give, the holder of any note, debenture or other evidence of indebtedness (or any person acting on such
holder’s behalf) the right to require the repurchase, redemption or repayment of all or a portion of such indebtedness by
the Company or the Subsidiary.


 


(t)            No
Material Actions or Proceedings. Except as otherwise disclosed in the Prospectus, there is no action, suit, proceeding, inquiry
or investigation brought by or before any legal or governmental entity now pending or, to the Company’s knowledge, threatened,
against or affecting the Company or the Subsidiary, which would reasonably be expected, individually or in the aggregate, to result
in a Material Adverse Change. No material labor dispute with the employees of the Company or the Subsidiary, or with the employees
of any principal supplier, manufacturer, customer or contractor of the Company, exists or, to the Company’s knowledge, is
threatened or imminent.


 






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(u)            Intellectual
Property Rights. The Company and the Subsidiary own, or have obtained valid and enforceable licenses, if any, for, the inventions,
patent applications, patents, trademarks, trade names, service names, copyrights, trade secrets and other intellectual property
described in the Registration Statement and the Prospectus as being owned or licensed by them or which are necessary for the conduct
of their respective businesses as currently conducted or as currently proposed to be conducted (collectively, “Intellectual
Property”), except where the failure to have such Intellectual Property would not reasonably be expected to result in,
individually or in the aggregate, a Material Adverse Change. To the Company's knowledge: (i) there are no third parties who
have rights to any Intellectual Property that is disclosed in the Registration Statement and the Prospectus; and (ii) there
is no infringement by third parties of any Intellectual Property. There is no pending or, to the Company’s knowledge, threatened
action, suit, proceeding or claim by others: (A) challenging the Company’s rights in or to any Intellectual Property,
and the Company is unaware of any facts which would form a reasonable basis for any such action, suit, proceeding or claim; (B) challenging
the validity, enforceability or scope of any material Intellectual Property, and the Company is unaware of any facts which would
form a reasonable basis for any such action, suit, proceeding or claim; or (C) asserting that the Company or the Subsidiary
infringes or otherwise violates, or would, upon the commercialization of any product or service described in the Registration
Statement or the Prospectus as under development, infringe or violate, any patent, trademark, trade name, service name, copyright,
trade secret or other proprietary rights of others, and the Company is unaware of any facts which would form a reasonable basis
for any such action, suit, proceeding or claim. The product candidates described in the Registration Statement and the Prospectus
as under development by the Company or the Subsidiary fall within the scope of the claims of one or more patents owned by, or
exclusively licensed to, the Company or the Subsidiary.


 


(v)            All
Necessary Permits, etc. Except as otherwise disclosed in the Prospectus, the Company and the Subsidiary possess such
valid and current certificates, authorizations or permits required by state, federal, provincial or foreign regulatory agencies
or bodies to conduct their respective businesses as currently conducted and as described in the Registration Statement or the
Prospectus (“Permits”), except where the failure to so possess would not reasonably be expected, individually
or in the aggregate, to result in a Material Adverse Change. Neither the Company nor the Subsidiary is in violation of, or in
default under, any of the Permits or has received any notice of proceedings relating to the revocation or modification of, or
non-compliance with, any such certificate, authorization or permit, except as would not reasonably be expected, individually or
in the aggregate, to result in a Material Adverse Change.


 


(w)           Title
to Properties. Except as otherwise disclosed in the Prospectus, the Company and the Subsidiary have good and marketable title
to all of the real and personal property or, in Québec, good and valid title to all real property and all personal property
and other assets reflected as owned in the financial statements referred to in ‎Section 2(m)  above (or elsewhere
in the Registration Statement or the Prospectus, in each case free and clear of any security interests, mortgages, liens, encumbrances,
equities, adverse claims and other defects, except where the failure to so possess would not reasonably be expected, individually
or in the aggregate, to result in a Material Adverse Change. The real property, improvements, equipment and personal property
held under lease by the Company or the Subsidiary are held under valid and enforceable leases, with such exceptions as are not
material and do not materially interfere with the use made or proposed to be made of such real property, improvements, equipment
or personal property by the Company or the Subsidiary.


 






    	 	10	 



     


    







 


(x)            Tax
Law Compliance. The Company and the Subsidiary have filed all U.S. and Canadian federal and material state, provincial, municipal
and local and any other foreign tax returns that are required to be filed or have properly requested extensions thereof and have
paid all taxes required to be paid by any of them and, if due and payable, any related or similar assessment, fine or penalty
levied against any of them except as may be contested in good faith and by appropriate proceedings and except where the failure
to file or pay would not reasonably be expected, individually or in the aggregate, to result in a Material Adverse Change. The
Company has made adequate charges, accruals and reserves in the applicable financial statements referred to in ‎Section 2(m) above
in respect of all U.S. and Canadian federal, state, provincial, municipal, local and foreign taxes for all periods as to which
the tax liability of the Company or the Subsidiary has not been finally determined, except where the failure to make such adequate
charge, accrual or reserve would not reasonably be expected, individually or in the aggregate, to result in a Material Adverse
Change.


 


(y)            Company
Not an “Investment Company.” The Company is not, and will not be, either after receipt of payment for the Shares
or after the application of the proceeds therefrom as described under “Use of Proceeds” in the Registration Statement
or the Prospectus, required to register as an “investment company” under the Investment Company Act of 1940, as amended
(the “Investment Company Act”).


 


(z)            Insurance.
Except as otherwise disclosed in the Prospectus, each of the Company and the Subsidiary are insured by recognized, financially
sound and reputable institutions with policies in such amounts and with such deductibles and covering such risks as are generally
deemed adequate and customary for their businesses including, but not limited to, policies covering material real and personal
property owned or leased by the Company and the Subsidiary against theft, damage, destruction, acts of vandalism and earthquakes
and policies covering the Company and the Subsidiary for product liability claims and clinical trial liability claims. The Company
has no reason to believe that it or the Subsidiary will not be able (i) to renew its existing insurance coverage as and when
such policies expire or (ii) to obtain comparable coverage from similar institutions as may be necessary or appropriate to
conduct its business as now conducted and at a cost that could not be expected to result in a Material Adverse Change. Neither
the Company nor the Subsidiary has been denied any insurance coverage which it has sought or for which it has applied.


 


(aa)          No
Price Stabilization or Manipulation; Compliance with Regulation M. Neither the Company nor the Subsidiary has taken, directly
or indirectly, and excluding any activities by the Agent, any action designed to or that might cause or result in stabilization
or manipulation of the price of the Common Shares or of any “reference security” (as defined in Rule 100 of Regulation
M under the Exchange Act (“Regulation M”)) with respect to the Common Shares, whether to facilitate the sale
or resale of the Shares or otherwise, and has taken no action which would directly or indirectly violate Regulation M.


 






    	 	11	 



     


    

 


(bb)          Related
Party Transactions. There are no business relationships or related-party transactions involving the Company or the Subsidiary
or any other person required to be described in the Registration Statement or the Prospectus which have not been described as
required.








 


(cc)          FINRA
Matters. All of the information provided to the Agent or to counsel for the Agent by the Company, and, to the Company’s
knowledge, its officers and directors, its counsel and the holders of any securities (debt or equity) or options to acquire any
securities of the Company in connection with the offering of the Shares is true, complete and correct in all material respects
and compliant with Financial Industry Regulatory Authority, Inc.’s (“FINRA”) rules and any
letters, filings or other supplemental information provided to FINRA pursuant to FINRA Rules or NASD Conduct Rules is
true, complete and correct in all material respects. The Company meets the requirements for use of Form S-3 under the Securities
Act specified in FINRA Rule 5110(b)(7)(C)(i).


 


(dd)          No
Unlawful Contributions or Other Payments. Except as otherwise disclosed in the Prospectus, neither the Company nor the Subsidiary
nor, to the Company’s knowledge, any employee or agent of the Company or the Subsidiary, has made any contribution or other
payment to any official of, or candidate for, any federal, state, provincial or foreign office in violation of any law or of the
character required to be disclosed in the Registration Statement and the Prospectus.


 


(ee)          Compliance
with Environmental Laws. Except as described in the Prospectus and except as would not reasonably be expected, individually
or in the aggregate, to result in a Material Adverse Change; (i) neither the Company nor the Subsidiary is in violation of
any federal, state, provincial, local or foreign statute, law, rule, regulation, ordinance, code, policy or rule of common
law or any judicial or administrative interpretation thereof, including any judicial or administrative order, consent, decree
or judgment, relating to pollution or protection of human health, the environment (including, without limitation, ambient air,
surface water, groundwater, land surface or subsurface strata) or wildlife, including, without limitation, laws and regulations
relating to the release or threatened release of chemicals, pollutants, contaminants, wastes, toxic substances, hazardous substances,
petroleum or petroleum products (collectively, “Hazardous Materials”) or to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport or handling of Hazardous Materials (collectively, “Environmental Laws”),
(ii) the Company and the Subsidiary have all permits, authorizations and approvals required under any applicable Environmental
Laws and are each in compliance with their requirements, (iii) there are no pending or, to the Company’s knowledge,
threatened administrative, regulatory or judicial actions, suits, demands, demand letters, claims, liens, notices of noncompliance
or violation, investigation or proceedings relating to any Environmental Law against the Company or the Subsidiary and (iv) to
the Company’s knowledge, there are no events or circumstances that might reasonably be expected to form the basis of an
order for clean-up or remediation, or an action, suit or proceeding by any private party or governmental body or agency, against
or affecting the Company or the Subsidiary relating to Hazardous Materials or any Environmental Laws.


 






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(ff)           ERISA
and Pension Compliance. Except as otherwise disclosed in the Prospectus, the Company and the Subsidiary and any “employee
benefit plan” (as defined under the Employee Retirement Income Security Act of 1974, as amended, and the regulations and
published interpretations thereunder (collectively, “ERISA”)) established or maintained by the Company, the
Subsidiary or their “ERISA Affiliates” (as defined below) are in compliance in all material respects with ERISA. “ERISA
Affiliate” means, with respect to the Company or the Subsidiary, any member of any group of organizations described
in Sections 414(b), (c), (m) or (o) of the Internal Revenue Code of 1986, as amended, and the regulations and published
interpretations thereunder (the “Code”) of which the Company or the Subsidiary is a member. No “reportable
event” (as defined under ERISA) has occurred or is reasonably expected to occur with respect to any “employee benefit
plan” established or maintained by the Company, the Subsidiary or any of their ERISA Affiliates. No “employee benefit
plan” established or maintained by the Company, the Subsidiary or any of their ERISA Affiliates, if such “employee
benefit plan” were terminated, would have any “amount of unfunded benefit liabilities” (as defined under ERISA).
Neither the Company, the Subsidiary nor any of their ERISA Affiliates has incurred or reasonably expects to incur any liability
under (i) Title IV of ERISA with respect to termination of, or withdrawal from, any “employee benefit plan”
or (ii) Sections 412, 4971, 4975 or 4980B of the Code. Each “employee benefit plan” established or maintained
by the Company, the Subsidiary or any of their ERISA Affiliates that is intended to be qualified under Section 401(a) of
the Code is so qualified and nothing has occurred, whether by action or failure to act, which would cause the loss of such qualification.
Neither the Company nor the Subsidiary has any actual or contingent liability or obligation to or in respect of any employee benefit
plan with a “defined benefit provision” (within the meaning of subsection 147.1(1) of the Income Tax Act (Canada)),
or any other plan that is required to be registered pursuant to applicable pension benefit standards legislation of provincial
or federal jurisdiction in Canada, including without limitation the Supplemental Pension Plans Act (Québec).








 


(gg)         Brokers.
Except as otherwise disclosed in the Prospectus, there is no broker, finder or other party that is entitled to receive from the
Company any brokerage or finder’s fee or other fee or commission as a result of any transactions contemplated by this Agreement.


 


(hh)          No
Outstanding Loans or Other Extensions of Credit. The Company does not have any outstanding extension of credit, in the form
of a personal loan, to or for any director or executive officer (or equivalent thereof) of the Company except for such extensions
of credit as are expressly permitted by Section 13(k) of the Exchange Act.


 


(ii)            Compliance
with Laws. The Company and the Subsidiary have been and are in compliance with all applicable laws, rules and regulations
(including, for the avoidance of doubt, all applicable Canadian and U.S. securities laws), except where failure to be so in compliance
would not reasonably be expected, individually or in the aggregate, to result in a Material Adverse Change.


 


(jj)            Dividend
Restrictions. Except as disclosed in the Prospectus, the Subsidiary is not prohibited or restricted, directly or indirectly,
from paying dividends to the Company, or from making any other distribution with respect to the Subsidiary’s equity securities
or from repaying to the Company any amounts that may from time to time become due under any loans or advances to the Subsidiary
from the Company or from transferring any property or assets to the Company.


 






    	 	13	 



     


    

 



 


(kk)         Anti-Corruption
and Anti-Bribery Laws. Neither the Company nor the Subsidiary nor any director, officer, or employee of the Company or the
Subsidiary, nor to the knowledge of the Company, any agent, affiliate or other person acting on behalf of the Company or the Subsidiary
has, in the course of its actions for, or on behalf of, the Company or the Subsidiary (i) used any corporate funds for any
unlawful contribution, gift, entertainment or other unlawful expenses relating to political activity; (ii) made or taken
any act in furtherance of an offer, promise, or authorization of any direct or indirect unlawful payment or benefit to any foreign
or domestic government official or employee, including of any government-owned or controlled entity or public international organization,
or any political party, party official, or candidate for political office; (iii) violated or is in violation of any provision
of the U.S. Foreign Corrupt Practices Act of 1977, as amended (the “FCPA”), the Corruption of Foreign Public
Officials Act (Canada), the UK Bribery Act 2010, or any other applicable anti-bribery or anti-corruption law; or (iv) made,
offered, authorized, requested, or taken an act in furtherance of any unlawful bribe, rebate, payoff, influence payment, kickback
or other unlawful payment or benefit. The Company and the Subsidiary and, to the Company’s knowledge, the Company’s
affiliates have conducted their respective businesses in compliance with the FCPA and have instituted and maintain policies and
procedures designed to ensure, and which are reasonably expected to continue to ensure, continued compliance therewith.


 


(ll)           Money
Laundering Laws. The operations of the Company and the Subsidiary are, and have been conducted at all times, in compliance
with applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970,
as amended, the money laundering statutes of all applicable jurisdictions, the rules and regulations thereunder and any related
or similar applicable rules, regulations or guidelines, issued, administered or enforced by any governmental agency (collectively,
the “Money Laundering Laws”) and no action, suit or proceeding by or before any court or governmental agency,
authority or body or any arbitrator involving the Company or the Subsidiary with respect to the Money Laundering Laws is pending
or, to the Company’s knowledge, threatened.


 


(mm)       Clinical
Data and Regulatory Compliance. The preclinical tests and clinical trials, and other studies (collectively, “studies”)
that are described in, or the results of which are referred to in, the Registration Statement or the Prospectus were and, if still
pending, are being conducted in all material respects in accordance with the protocols, procedures and controls designed and approved
for such studies and with standard medical and scientific research procedures; each description of the results of such studies
is accurate and complete in all material respects and fairly presents the data derived from such studies, and the Company and
the Subsidiary have no knowledge of any other studies the results of which are inconsistent with, or otherwise call into question,
the results described or referred to in the Registration Statement or the Prospectus; the Company and the Subsidiary have made
all such filings and obtained all such approvals as may be required by the Food and Drug Administration of the U.S. Department
of Health and Human Services or any committee thereof or from any other U.S. or foreign government or drug or medical device regulatory
agency, or health care facility Institutional Review Board (collectively, the “Regulatory Agencies”); neither
the Company nor the Subsidiary has received any notice of, or correspondence from, any Regulatory Agency requiring the termination,
suspension or modification of any clinical trials that are described or referred to in the Registration Statement or the Prospectus;
and the Company and the Subsidiary have each operated and currently are in compliance in all material respects with all applicable
rules, regulations and policies of the Regulatory Agencies.


 






    14


     


    

 


(nn)        Sanctions.
Neither the Company nor the Subsidiary, directors, officers, or employees, nor, to the Company’s knowledge, after due inquiry,
any agent, affiliate or other person acting on behalf of the Company or the Subsidiary is currently the subject or the target
of any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury (“OFAC”)
or the U.S. Department of State, the United Nations Security Council, the European Union, Her Majesty’s Treasury of the
United Kingdom, Global Affairs Canada or other relevant sanctions authority (collectively, “Sanctions”); nor
is the Company or the Subsidiary located, organized or resident in a country or territory that is the subject or the target of
Sanctions, including, without limitation, Crimea, Cuba, Iran, North Korea, and Syria; and the Company will not directly or
indirectly use the proceeds of this offering, or lend, contribute or otherwise make available such proceeds to the Subsidiary,
or any joint venture partner or other person or entity, for the purpose of financing the activities of or business with any person,
or in any country or territory, that at the time of such financing, is the subject or the target of Sanctions or in any other
manner that will result in a violation by any person (including any person participating in the transaction whether as underwriter,
advisor, investor or otherwise) of applicable Sanctions. For the past five years, the Company and the Subsidiary have not knowingly
engaged in and are not now knowingly engaged in any dealings or transactions with any person that at the time of the dealing or
transaction is or was the subject or the target of Sanctions or with any Sanctioned Country.


  


(oo)        Sarbanes-Oxley.
The Company is in compliance, in all material respects, with all applicable provisions of the Sarbanes-Oxley Act of 2002 and the
rules and regulations promulgated thereunder.


 


(pp)        Canadian
Reporting Issuer. The Company is a reporting issuer in the Province of Québec and is not on the list of defaulting reporting
issuers maintained by the AMF. The Company has not filed any confidential material changes reports that remain confidential at
the date hereof.


 


(qq)        Québec
Securities Laws. The Company has complied with the securities laws of the Province of Québec, including the rules and
regulations made thereunder together with applicable published national and local instruments, policy statements, notices, blanket
rulings and orders of the AMF, and all discretionary rulings and orders applicable to the Company, if any, of the Canadian securities
commissions required to be complied with by the Company in order to sell the Shares outside Canada as contemplated by this Agreement.
To the Company’s knowledge, no order, ruling or decision of any court or any securities regulatory authority in Canada is
in effect that restricts or ceases trades in securities of the Company.


 


(rr)          Section 12
Order. The Company has obtained from the AMF an order under Section 12 of the Québec Securities Act allowing the
sales thereunder of Common Shares to persons established outside the Province of Québec, Canada.


 


(ss)         Duties,
Transfer Taxes, Etc. No stamp or other issuance or transfer taxes or duties and no capital gains, income, withholding or other
taxes are payable by the Agent in the United States or any political subdivision or taxing authority thereof or therein in connection
with the execution, delivery or performance of this Agreement by the Company or the sale and delivery by the Company of the Shares.


 



    15


     


    

 





(tt)          Cybersecurity.
(i) To the Company’s knowledge, there has been no security breach or other compromise of or relating to any of the information
technology and computer systems, networks, hardware, software, data, equipment or technology owned, held or used by or for the
Company (including the data of its customers, employees, suppliers, vendors and any third party data maintained by or on behalf
of the Company) (collectively, the “IT Systems and Data”), (ii) the Company has not been notified of, and
has no knowledge of any event or condition that would reasonably be expected to result in, any material security breach or other
material compromise to the IT Systems and Data; (iii) the Company has complied, and is presently in compliance, with all applicable
laws or statutes and all judgments, orders, rules and regulations of any court or arbitrator or governmental or regulatory
authority, internal policies and contractual obligations relating to (x) the collection, use, transfer, storage, protection,
disposal and/or disclosure of personally identifiable information collected from or provided by third parties, (y) the privacy
and security of the IT Systems and Data and (z) the protection of the IT Systems and Data from unauthorized use, access, misappropriation
or modification, except as would not reasonably be expected, in the case of this clause (iii), individually or in the aggregate,
result in a Material Adverse Change; and (iv) the Company has taken commercially reasonable steps to protect the IT Systems
and Data, including by implementing backup, security and disaster recovery plans, procedures and technology consistent with industry
standards and practices.


 


(uu)        Submission
to Jurisdiction. The Company has the power to submit, and pursuant to Section 8(g) of this Agreement, has
legally, validly, effectively and irrevocably submitted, to the personal jurisdiction of the Specified Courts (as defined below),
and the Company has the power to designate, appoint and authorize, and pursuant to Section 8(g) of this Agreement,
has legally, validly, effectively and irrevocably designated, appointed and authorized an agent for service of process in any
action arising out of or relating to this Agreement or the Shares in any Specified Court, and service of process effected on such
authorized agent will be effective to confer valid personal jurisdiction over the Company as provided in Section 8(g) hereof.


 


(vv)        Judgment.
The courts of Canada would recognize as a valid judgment any final monetary judgment obtained against the Company in the courts
of the State of New York.


 


(ww)       Immunity.
Neither the Company nor the Subsidiary nor any of its or their properties or assets has any immunity from the jurisdiction of any
court or from any legal process (whether through service or notice, attachment prior to judgment, attachment in aid of execution
or otherwise) under the federal laws of Canada or the laws of the Province of Québec. The irrevocable and unconditional
waiver and agreement of the Company contained in Section 8(g) hereof not to plead or claim any such immunity in
any legal action, suit or proceeding based on this Agreement is valid and binding under the federal laws of Canada and the laws
of the Province of Québec.


 


(xx)         Choice
of Law. The choice of law of the State of New York as the governing law of this Agreement is a valid choice of law under the
laws of the Province of Québec and will be honored by the courts of Québec. The Company has the power to submit,
and pursuant to Section 8(g) has, to the extent permitted by law, legally, validly, effectively and irrevocably
submitted, to the jurisdiction of the Specified Courts (as defined in Section 8(g)).


 


(yy)        Other
Underwriting Agreements. The Company is not a party to any agreement with an agent or underwriter for any other “at the
market” or continuous equity transaction.


 



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Any certificate signed
by any officer or representative of the Company or the Subsidiary and delivered to the Agent or counsel for the Agent in connection
with an issuance of Shares shall be deemed a representation and warranty by the Company to the Agent as to the matters covered
thereby on the date of such certificate.


  


The Company acknowledges
that the Agent and, for purposes of the opinions to be delivered pursuant to Section 4(q) hereof, counsel to the
Company and counsel to the Agent, will rely upon the accuracy and truthfulness of the foregoing representations and hereby consents
to such reliance.


 


Section 3. ISSUANCE AND SALE OF COMMON SHARES


 


(a)           Sale
of Securities. On the basis of the representations, warranties and agreements herein contained, but subject to the terms and
conditions herein set forth, the Company and the Agent agree that the Company may from time to time seek to sell Shares through
the Agent, acting as sales agent, or directly to the Agent, acting as principal, as follows, with an aggregate Sales Price of up
to the Maximum Program Amount, based on and in accordance with Issuance Notices as the Company may deliver, during the Agency Period.


 


(b)           Mechanics
of Issuances.


 


(i)            Issuance
Notice. Upon the terms and subject to the conditions set forth herein, on any Trading Day during the Agency Period on which
the conditions set forth in ‎Section 5(a) and ‎Section 5(b) shall have been satisfied,
the Company may exercise its right to request an issuance of Shares by delivering to the Agent an Issuance Notice; provided,
however, that (A) in no event may the Company deliver an Issuance Notice to the extent that (I) the sum of (x) the
aggregate Sales Price of the requested Issuance Amount, plus (y) the aggregate Sales Price of all Shares issued under all
previous Issuance Notices effected pursuant to this Agreement, would exceed the Maximum Program Amount; and (B) prior to delivery
of any Issuance Notice, the period set forth for any previous Issuance Notice shall have expired or been terminated. An Issuance
Notice shall be considered delivered on the Trading Day that it is received by e-mail to the persons set forth in Schedule A hereto
and confirmed by the Company by telephone (including a voicemail message to the persons so identified), with the understanding
that, with adequate prior written notice, the Agent may modify the list of such persons from time to time.


 


(ii)           Agent
Efforts. Upon the terms and subject to the conditions set forth in this Agreement, upon the receipt of an Issuance Notice,
the Agent will use its commercially reasonable efforts consistent with its normal sales and trading practices to place the Shares
with respect to which the Agent has agreed to act as sales agent, subject to, and in accordance with the information specified
in, the Issuance Notice, unless the sale of the Shares described therein has been suspended, cancelled or otherwise terminated
in accordance with the terms of this Agreement. For the avoidance of doubt, the parties to this Agreement may modify an Issuance
Notice at any time provided they both agree in writing to any such modification.


 


(iii)          Method
of Offer and Sale. The Shares may be offered and sold (A) in privately negotiated transactions with the consent of the
Company; (B) as block transactions with the consent of the Company; or (C) by any other method permitted by law deemed
to be an “at the market offering” as defined in Rule 415(a)(4) under the Securities Act, including sales
made directly on the Principal Market or sales made into any other existing trading market of the Common Shares. Nothing in this
Agreement shall be deemed to require either party to agree to the method of offer and sale specified in the preceding sentence,
and (except as specified in clauses (A) and (B) above) the method of placement of any Shares by the Agent shall be at
the Agent’s discretion.


 






    17


     


    

 


(iv)          Confirmation
to the Company. If acting as sales agent hereunder, the Agent will provide written confirmation to the Company no later than
the opening of the Trading Day next following the Trading Day on which it has placed Shares hereunder setting forth the number
of Shares sold on such Trading Day, the corresponding Sales Price and the Issuance Price payable to the Company in respect thereof.


 


(v)           Settlement.
Each issuance of Shares will be settled on the applicable Settlement Date for such issuance of Shares and, subject to the provisions
of ‎Section 5, on or before each Settlement Date, the Company will, or will cause its transfer agent to, electronically
transfer the Shares being sold by crediting the Agent’s or its designee’s account at The Depository Trust Company through
its Deposit/Withdrawal At Custodian (DWAC) System, or by such other means of delivery as may be mutually agreed upon by the parties
hereto and, upon receipt of such Shares, which in all cases shall be freely tradable, transferable, registered shares in good deliverable
form, the Agent will deliver, by wire transfer of immediately available funds, the related Issuance Price in same day funds delivered
to an account designated by the Company prior to the Settlement Date. The Company may sell Shares to the Agent as principal at
a price agreed upon at each relevant time Shares are sold pursuant to this Agreement (each, a “Time of Sale”).


 


(vi)          Suspension
or Termination of Sales. Consistent with standard market settlement practices, the Company or the Agent may, upon notice to
the other party hereto in writing or by telephone (confirmed immediately by verifiable email), suspend any sale of Shares, and
the period set forth in an Issuance Notice shall immediately terminate; provided, however, that (A) such suspension
and termination shall not affect or impair either party’s obligations with respect to any Shares placed or sold hereunder
prior to the receipt of such notice; (B) if the Company suspends or terminates any sale of Shares after the Agent confirms
such sale to the Company, the Company shall still be obligated to comply with ‎Section 3(b)(v) with respect
to such Shares; and (C) if the Company defaults in its obligation to deliver Shares on a Settlement Date, the Company agrees
that it will hold the Agent harmless against any loss, claim, damage or expense (including, without limitation, penalties, interest
and reasonable legal fees and expenses), as incurred, arising out of or in connection with such default by the Company. The parties
hereto acknowledge and agree that, in performing its obligations under this Agreement, the Agent may borrow Common Shares from
stock lenders in the event that the Company has not delivered Shares to settle sales as required by subsection (v) above,
and may use the Shares to settle or close out such borrowings. The Company agrees that no such notice shall be effective against
the Agent unless it is made to the persons identified in writing by the Agent pursuant to ‎Section 3(b)(i).


 


(vii)         No
Guarantee of Placement, Etc. The Company acknowledges and agrees that (A) there can be no assurance that the Agent will
be successful in placing Shares; (B) the Agent will incur no liability or obligation to the Company or any other Person if
it does not sell Shares; and (C) the Agent shall be under no obligation to purchase Shares on a principal basis pursuant to
this Agreement, except as otherwise specifically agreed by the Agent and the Company.


 






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(viii)        Material
Non-Public Information. Notwithstanding any other provision of this Agreement, the Company and the Agent agree that the Company
shall not deliver any Issuance Notice to the Agent, and the Agent shall not be obligated to place any Shares, during any period
in which the Company is in possession of material non-public information.


 


(c)           Fees.
As compensation for services rendered, the Company shall pay to the Agent, on the applicable Settlement Date, the Selling Commission
for the applicable Issuance Amount (including with respect to any suspended or terminated sale pursuant to Section 3(b)(vi))
by the Agent deducting the Selling Commission from the applicable Issuance Amount.


 


(d)           Expenses.
The Company agrees to pay all costs, fees and expenses incurred in connection with the performance of its obligations hereunder
and in connection with the transactions contemplated hereby, including without limitation (i) all expenses incident to the
issuance and delivery of the Shares (including all printing and engraving costs); (ii) all fees and expenses of the registrar
and transfer agent of the Shares; (iii) all necessary issue, transfer and other stamp taxes in connection with the issuance
and sale of the Shares; (iv) all fees and expenses of the Company’s counsel, independent public or certified public
accountants and other advisors; (v) all costs and expenses incurred in connection with the preparation, printing, filing,
shipping and distribution of the Registration Statement (including financial statements, exhibits, schedules, consents and certificates
of experts), the Prospectus, any Free Writing Prospectus (as defined below) prepared by or on behalf of, used by, or referred
to by the Company, and all amendments and supplements thereto, and this Agreement; (vi) all filing fees, attorneys’
fees and expenses incurred by the Company or the Agent in connection with qualifying or registering (or obtaining exemptions from
the qualification or registration of) all or any part of the Shares for offer and sale under the state securities or blue sky
laws or the provincial securities laws of Canada, and, if requested by the Agent, preparing and printing a “Blue Sky
Survey” or memorandum and a “Canadian wrapper” and any supplements thereto, advising the Agent of such qualifications,
registrations, determinations and exemptions; (vii) the reasonable and documented fees and disbursements of the Agent’s
counsel, including the reasonable and documented fees and expenses of counsel for the Agent in connection with, FINRA review,
if any, and approval of the Agent’s participation in the offering and distribution of the Shares; (viii) the filing
fees incident to FINRA review, if any; and (ix) the fees and expenses associated with listing the Shares on the Principal
Market. The fees and disbursements of Agent’s counsel pursuant to subsections (vi) and (vii) above shall not exceed
$65,000.


 


Section 4. ADDITIONAL COVENANTS


 


The Company covenants
and agrees with the Agent as follows, in addition to any other covenants and agreements made elsewhere in this Agreement:


 


(a)           Exchange
Act Compliance. During the Agency Period, the Company shall (i) file, on a timely basis, with the Commission all reports
and documents required to be filed under Section 13, 14 or 15 of the Exchange Act in the manner and within the time periods
required by the Exchange Act; and (ii) in the Company’s sole discretion, either (A) include in its quarterly reports
on Form 10-Q and its annual reports on Form 10-K, a summary detailing, for the relevant reporting period, (1) the
number of Shares sold through the Agent pursuant to this Agreement and (2) the net proceeds received by the Company from such
sales, or (B) prepare a prospectus supplement containing, or include in such other filing permitted by the Securities Act
or Exchange Act (each an “Interim Prospectus Supplement”), such summary information and, at least once a quarter
and subject to this Section 4, file such Interim Prospectus Supplement pursuant to Rule 424(b) under the
Securities Act (and within the time periods required by Rule 424(b) and Rule 430B under the Securities Act)).


 






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(b)           Securities
Act Compliance. After the date of this Agreement, the Company shall promptly advise the Agent in writing (i) of the receipt
of any comments of, or requests for additional or supplemental information from, the Commission; (ii) of the time and date
of any filing of any post-effective amendment to the Registration Statement, any Rule 462(b) Registration Statement or
any amendment or supplement to the Prospectus, or any Free Writing Prospectus; (iii) of the time and date that any post-effective
amendment to the Registration Statement or any Rule 462(b) Registration Statement becomes effective; and (iv) of
the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or any post-effective
amendment thereto, any Rule 462(b) Registration Statement or any amendment or supplement to the Prospectus or of any
order preventing or suspending the use of any Free Writing Prospectus or the Prospectus, or of any proceedings to remove, suspend
or terminate from listing or quotation the Common Shares from any securities exchange upon which they are listed for trading or
included or designated for quotation, or of the threatening or initiation of any proceedings for any of such purposes. If the Commission
shall enter any such stop order at any time, the Company will use its reasonable best efforts to obtain the lifting of such order
as soon as practicable. Additionally, the Company agrees that it shall comply with the provisions of Rule 424(b) and
Rule 433, as applicable, under the Securities Act and will use its reasonable efforts to confirm that any filings made by
the Company under such Rule 424(b) or Rule 433 were filed in a timely manner with the Commission.


 


(c)           Canadian
Securities Laws Compliance. During the Agency Period, the Company shall file, on a timely basis, with the AMF all reports and
documents required to be filed pursuant to applicable Canadian securities laws and shall comply with all requirements imposed upon
it by the Canadian securities laws as from time to time in force, so far as necessary to permit the continuance of sales of, or
dealings in, the Common Shares as contemplated by the provisions hereof and the Prospectus.


 


(d)           Amendments
and Supplements to the Prospectus and Other Securities Act Matters. If any event shall occur or condition exist as a result
of which it is necessary to amend or supplement the Prospectus so that the Prospectus does not include an untrue statement of a
material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances
when the Prospectus is delivered to a purchaser, not misleading, or if in the opinion of the Agent or counsel for the Agent it
is otherwise necessary to amend or supplement the Prospectus to comply with applicable law, including the Securities Act, the Company
agrees (subject to Sections 4(e) and 4(g)) to promptly prepare, file with the Commission and furnish at
its own expense to the Agent, amendments or supplements to the Prospectus so that the statements in the Prospectus as so amended
or supplemented will not include an untrue statement of a material fact or omit to state a material fact necessary in order to
make the statements therein, in the light of the circumstances when the Prospectus is delivered to a purchaser, be misleading or
so that the Prospectus, as amended or supplemented, will comply with applicable law including the Securities Act. Neither the Agent’s
consent to, or delivery of, any such amendment or supplement shall constitute a waiver of any of the Company’s obligations
under Sections 4(e) and 4(g). Notwithstanding the foregoing, the Company shall not be required to file such
amendment or supplement if there is no pending Issuance Notice and the Company believes that it is in its best interests not to
file such amendment or supplement.


 






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(e)           Agent’s
Review of Proposed Amendments and Supplements. Prior to amending or supplementing the Registration Statement (including any
Rule 462(b) Registration Statement) or the Prospectus (excluding any amendment or supplement through incorporation of
any report filed under the Exchange Act), the Company shall furnish to the Agent for review, a reasonable amount of time prior
to the proposed time of filing or use thereof, a copy of each such proposed amendment or supplement, and the Company shall not
file or use any such proposed amendment or supplement without the Agent’s prior consent, and the Company shall file with
the Commission within the applicable period specified in Rule 424(b) under the Securities Act any prospectus required
to be filed pursuant to such Rule.


 


(f)            Use
of Free Writing Prospectus. Neither the Company nor the Agent has prepared, used, referred to or distributed, or will prepare,
use, refer to or distribute, without the other party’s prior written consent, any “written communication” that
constitutes a “free writing prospectus” as such terms are defined in Rule 405 under the Securities Act with respect
to the offering contemplated by this Agreement (any such free writing prospectus being referred to herein as a “Free
Writing Prospectus”).


 


(g)           Free
Writing Prospectuses. The Company shall furnish to the Agent for review, a reasonable amount of time prior to the proposed
time of filing or use thereof, a copy of each proposed free writing prospectus relating to the Shares or any amendment or supplement
thereto to be prepared by or on behalf of, used by, or referred to by the Company and the Company shall not file, use or refer
to any proposed free writing prospectus relating to the Shares or any amendment or supplement thereto without the Agent’s
consent, such consent not to be unreasonably withheld or delayed. The Company shall furnish to the Agent, without charge, as many
copies of any free writing prospectus relating to the Shares prepared by or on behalf of, or used by the Company, as the Agent
may reasonably request. If at any time when a prospectus is required by the Securities Act (including, without limitation, pursuant
to Rule 173(d)) to be delivered (whether physically or through compliance with Rule 172 under the Securities Act of any
similar rule) in connection with sales of the Shares (but in any event if at any time through and including the date of this Agreement)
there occurred or occurs an event or development as a result of which any free writing prospectus prepared by or on behalf of,
used by, or referred to by the Company conflicted or would conflict with the information contained in the Registration Statement
or included or would include an untrue statement of a material fact or omitted or would omit to state a material fact necessary
in order to make the statements therein, in the light of the circumstances prevailing at that subsequent time, not misleading,
the Company shall promptly amend or supplement such free writing prospectus to eliminate or correct such conflict or so that the
statements in such free writing prospectus as so amended or supplemented will not include an untrue statement of a material fact
or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances prevailing
at such subsequent time, not misleading, as the case may be; provided, however, that prior to amending or supplementing
any such free writing prospectus, the Company shall furnish to the Agent for review, a reasonable amount of time prior to the proposed
time of filing or use thereof, a copy of such proposed amended or supplemented free writing prospectus and the Company shall not
file, use or refer to any such amended or supplemented free writing prospectus without the Agent’s consent, such consent
not to be unreasonably withheld or delayed.


 



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(h)           Filing
of Agent Free Writing Prospectuses. The Company shall not take any action that would result in the Agent or the Company being
required to file with the Commission pursuant to Rule 433(d) under the Securities Act a free writing prospectus prepared
by or on behalf of the Agent that the Agent otherwise would not have been required to file thereunder.


 


(i)            Copies
of Registration Statement and Prospectus. After the date of this Agreement through the last time that a prospectus is required
by the Securities Act (including, without limitation, pursuant to Rule 173(d)) to be delivered in connection with sales of
the Shares, the Company agrees to furnish the Agent with copies (which may be electronic copies) of the Registration Statement
and each amendment thereto, and with copies (which may be electronic copies) of the Prospectus and each amendment or supplement
thereto in the form in which it is filed with the Commission pursuant to the Securities Act or Rule 424(b) under the
Securities Act, both in such quantities as the Agent may reasonably request from time to time; and, if the delivery of a prospectus
is required under the Securities Act or under the blue sky or securities laws of any jurisdiction at any time on or prior to the
applicable Settlement Date for any period set forth in an Issuance Notice in connection with the offering or sale of the Shares
and if at such time any event has occurred as a result of which the Prospectus as then amended or supplemented would include an
untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made when such Prospectus is delivered, not misleading, or, if for any other reason
it is necessary during such same period to amend or supplement the Prospectus or to file under the Exchange Act any document incorporated
by reference in the Prospectus in order to comply with the Securities Act or the Exchange Act, to notify the Agent and to request
that the Agent suspend offers to sell Shares (and, if so notified, the Agent shall cease such offers as soon as practicable); and
if the Company decides to amend or supplement the Registration Statement or the Prospectus as then amended or supplemented, to
advise the Agent promptly by telephone (with confirmation in writing) and to prepare and cause to be filed promptly with the Commission
an amendment or supplement to the Registration Statement or the Prospectus as then amended or supplemented that will correct such
statement or omission or effect such compliance; provided, however, that if during such same period the Agent is required to deliver
a prospectus in respect of transactions in the Shares, the Company shall promptly prepare and file with the Commission such an
amendment or supplement.


 


(j)            Blue
Sky Compliance. The Company shall cooperate with the Agent and counsel for the Agent to qualify or register the Shares for
sale under (or obtain exemptions from the application of) the state securities or blue sky laws or Canadian provincial securities
laws of those jurisdictions designated by the Agent, shall comply with such laws and shall continue such qualifications, registrations
and exemptions in effect so long as required for the distribution of the Shares. The Company shall not be required to qualify as
a foreign corporation or to take any action that would subject it to general service of process in any such jurisdiction where
it is not presently qualified or where it would be subject to taxation as a foreign corporation. The Company will advise the Agent
promptly of the suspension of the qualification or registration of (or any such exemption relating to) the Shares for offering,
sale or trading in any jurisdiction or any initiation or threat of any proceeding for any such purpose, and in the event of the
issuance of any order suspending such qualification, registration or exemption, the Company shall use its reasonable best efforts
to obtain the withdrawal thereof as soon as practicable.


 






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(k)           Earnings
Statement. As soon as practicable, the Company will make generally available to its security holders and to the Agent an earnings
statement (which need not be audited) covering a period of at least 12 months beginning with the first fiscal quarter of the Company
occurring after the date of this Agreement which shall satisfy the provisions of Section 11(a) of the Securities Act
and Rule 158 under the Securities Act.


 


(l)            Listing;
Reservation of Shares. (a)  The Company will use its reasonable best efforts to maintain the listing of the Shares on
the Principal Market; and (b) the Company will reserve and keep available at all times, free of preemptive rights, Shares
for the purpose of enabling the Company to satisfy its obligations under this Agreement.


 


(m)          Transfer
Agent. The Company shall engage and maintain, at its expense, a registrar and transfer agent for the Shares.


 


(n)           Due
Diligence. During the term of this Agreement, the Company will reasonably cooperate with any reasonable due diligence review
conducted by the Agent in connection with the transactions contemplated hereby, including, without limitation, providing information
and making available documents and senior corporate officers, during normal business hours and at the Company’s principal
offices, as the Agent may reasonably request from time to time.


 


(o)           Representations
and Warranties. The Company acknowledges that each delivery of an Issuance Notice and each delivery of Shares on a Settlement
Date shall be deemed to be (i) an affirmation to the Agent that the representations and warranties of the Company contained
in or made pursuant to this Agreement are true and correct as of the date of such Issuance Notice or of such Settlement Date, as
the case may be, as though made at and as of each such date, except as may be disclosed in the Prospectus (including any documents
incorporated by reference therein and any supplements thereto); and (ii) an undertaking that the Company will advise the Agent
if any of such representations and warranties will not be true and correct as of the Settlement Date for the Shares relating to
such Issuance Notice, as though made at and as of each such date (except that such representations and warranties shall be deemed
to relate to the Registration Statement and the Prospectus as amended and supplemented relating to such Shares).


 


(p)           Deliverables
at Triggering Event Dates; Certificates. The Company agrees that on or prior to the date of the first Issuance Notice and,
during the term of this Agreement after the date of the first Issuance Notice, upon:


 


(A)            the
filing of the Prospectus or the amendment or supplement of any Registration Statement or Prospectus (other than a prospectus supplement
relating solely to an offering of securities other than the Shares or a prospectus filed pursuant to Section 4(a)(ii)(B)),
by means of a post-effective amendment, sticker or supplement, but not by means of incorporation of documents by reference into
the Registration Statement or Prospectus;


 






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(B)            the
filing with the Commission of an annual report on Form 10-K or a quarterly report on Form 10-Q (including any Form 10-K/A
or Form 10-Q/A containing amended financial information or a material amendment to the previously filed annual report on Form 10-K
or quarterly report on Form 10-Q), in each case, of the Company; or


 


(C)            the
filing with the Commission of a current report on Form 8-K of the Company containing amended financial information (other
than information “furnished” pursuant to Item 2.02 or 7.01 of Form 8-K or to provide disclosure pursuant to Item
8.01 of Form 8-K relating to reclassification of certain properties as discontinued operations in accordance with Statement
of Financial Accounting Standards No. 144) that is material to the offering of securities of the Company in the Agent’s
reasonable discretion;


 


(any such event, a “Triggering
Event Date”), the Company shall furnish the Agent (but in the case of clause (C) above only if the Agent reasonably
determines that the information contained in such current report on Form 8-K of the Company is material to the offering of
securities of the Company) with a certificate as of the Triggering Event Date, in the form and substance satisfactory to the Agent
and its counsel, substantially similar to the form previously provided to the Agent and its counsel, modified, as necessary, to
relate to the Registration Statement and the Prospectus as amended or supplemented, (A) confirming that the representations
and warranties of the Company contained in this Agreement are true and correct, (B) confirming that the Company has performed
all of its obligations hereunder to be performed on or prior to the date of such certificate and as to the matters set forth in
‎Section 5(a)(iii) hereof, and (C) containing any other certification that the Agent shall reasonably
request. The requirement to provide a certificate under this Section 4(p) shall be waived for any Triggering Event
Date occurring at a time when no Issuance Notice is pending or a suspension is in effect, which waiver shall continue until the
earlier to occur of the date the Company delivers instructions for the sale of Shares hereunder (which for such calendar quarter
shall be considered a Triggering Event Date) and the next occurring Triggering Event Date. Notwithstanding the foregoing, if the
Company subsequently decides to sell Shares following a Triggering Event Date when a suspension was in effect and did not provide
the Agent with a certificate under this Section 4(p), then before the Company delivers the instructions for the sale
of Shares or the Agent sells any Shares pursuant to such instructions, the Company shall provide the Agent with a certificate in
conformity with this Section 4(p) dated as of the date that the instructions for the sale of Shares are issued.


 


(q)           Legal
Opinions. On or prior to the date of the first Issuance Notice and on or prior to each Triggering Event Date with respect to
which the Company is obligated to deliver a certificate pursuant to Section 4(p) for which no waiver is applicable
and excluding the date of this Agreement, the Company shall cause to be furnished a negative assurances letter and the written
legal opinion of Cooley LLP, U.S. counsel to the Company, Osler, Hoskin & Harcourt LLP, Canadian counsel to the Company,
and Clark & Elbing LLP, intellectual property counsel to the Company, each dated the date of delivery, in form and substance
reasonably satisfactory to Agent and its counsel, substantially similar to the form previously provided to the Agent and its counsel,
modified, as necessary, to relate to the Registration Statement and the Prospectus as then amended or supplemented. In lieu of
such opinions for subsequent periodic filings, in the discretion of the Agent, the Company may furnish a reliance letter from such
counsel to the Agent, permitting the Agent to rely on a previously delivered opinion letter, modified as appropriate for any passage
of time or Triggering Event Date (except that statements in such prior opinion shall be deemed to relate to the Registration Statement
and the Prospectus as amended or supplemented as of such Triggering Event Date).


 






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(r)            Comfort
Letter. On or prior to the date of the first Issuance Notice and on or prior to each Triggering Event Date with respect to
which the Company is obligated to deliver a certificate pursuant to Section 4(p) for which no waiver is applicable
and excluding the date of this Agreement, the Company shall cause PricewaterhouseCoopers LLP, the independent registered public
accounting firm who has audited the financial statements included or incorporated by reference in the Registration Statement, to
furnish the Agent a comfort letter, dated the date of delivery, in form and substance reasonably satisfactory to the Agent and
its counsel, substantially similar to the form previously provided to the Agent and its counsel; provided, however, that any such
comfort letter will only be required on the Triggering Event Date specified to the extent that it contains financial statements
filed with the Commission under the Exchange Act and incorporated or deemed to be incorporated by reference into a Prospectus.
If requested by the Agent, the Company shall also cause a comfort letter to be furnished to the Agent within ten (10) Trading
Days of the date of occurrence of any material transaction or event requiring the filing of a current report on Form 8-K containing
material amended financial information of the Company, including the restatement of the Company’s financial statements. The
Company shall be required to furnish no more than one comfort letter hereunder per calendar quarter.


 


(s)           Secretary’s
Certificate. On or prior to the date of the first Issuance Notice and on or prior to each Triggering Event Date, the Company
shall furnish the Agent a certificate executed by the Secretary of the Company, signing in such capacity, dated the date of delivery
(i) certifying that attached thereto are true and complete copies of the resolutions duly adopted by the Board of Directors
of the Company authorizing the execution and delivery of this Agreement and the consummation of the transactions contemplated
hereby (including, without limitation, the issuance of the Shares pursuant to this Agreement), which authorization shall be in
full force and effect on and as of the date of such certificate, (ii) certifying and attesting to the office, incumbency,
due authority and specimen signatures of each Person who executed this Agreement for or on behalf of the Company, and (iii) containing
any other certification that the Agent shall reasonably request.


 


(t)            Agent’s
Own Account; Clients’ Account. The Company consents to the Agent trading, in compliance with applicable law, in the Common
Shares for the Agent’s own account and for the account of its clients at the same time as sales of the Shares occur pursuant
to this Agreement.


 


(u)           Investment
Limitation. The Company shall not invest, or otherwise use the proceeds received by the Company from its sale of the Shares
in such a manner as would require the Company or the Subsidiary to register as an investment company under the Investment Company
Act.


 






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(v)           Market
Activities. The Company will not take, directly or indirectly, any action designed to or that might be reasonably expected
to cause or result in stabilization or manipulation of the price of the Shares or any other reference security, whether to facilitate
the sale or resale of the Shares or otherwise, and the Company will, and shall use its reasonable best efforts to cause each of
its affiliates to, comply with all applicable provisions of Regulation M. If the limitations of Rule 102 of Regulation M (“Rule 102”)
do not apply with respect to the Shares or any other reference security pursuant to any exception set forth in Section (d) of
Rule 102, then promptly upon notice from the Agent (or, if later, at the time stated in the notice), the Company will, and
shall use its reasonable best efforts to cause each of its affiliates to, comply with Rule 102 as though such exception were
not available but the other provisions of Rule 102 (as interpreted by the Commission) did apply. The Company shall promptly
notify the Agent if it no longer meets the requirements set forth in Section (d) of Rule 102.


 


(w)          Notice
of Other Sale. Without the written consent of the Agent, the Company will not, directly or indirectly, offer to sell, sell,
contract to sell, grant any option to sell or otherwise dispose of any Common Shares or securities convertible into or exchangeable
for Common Shares (other than Shares hereunder), warrants or any rights to purchase or acquire Common Shares, during the period
beginning on the Trading Day immediately prior to the date on which any Issuance Notice is delivered to the Agent hereunder and
ending on the Trading Day immediately following the Settlement Date with respect to Shares sold pursuant to such Issuance Notice;
and will not directly or indirectly enter into any other “at the market” or continuous equity transaction offer to
sell, sell, contract to sell, grant any option to sell or otherwise dispose of any Common Shares (other than the Shares offered
pursuant to this Agreement) or securities convertible into or exchangeable for Common Shares, warrants or any rights to purchase
or acquire, Common Shares prior to the termination of this Agreement; provided, however, that such restrictions will not be required
in connection with the Company’s (i) issuance or sale of Common Shares, options to purchase Common Shares or Common
Shares issuable upon the exercise of options or other equity awards pursuant to any employee or director share option, incentive
or benefit plan, share purchase or ownership plan, long-term incentive plan, dividend reinvestment plan, inducement award under
Nasdaq rules or other compensation plan of the Company or the Subsidiary, as in effect on the date of this Agreement, (ii) issuance
or sale of Common Shares issuable upon exchange, conversion or redemption of securities or the exercise or vesting of warrants,
options or other equity awards outstanding at the date of this Agreement, (iii) issuance or sale of Common Shares or securities
convertible into or exchangeable for Common Shares as consideration for mergers, acquisitions, other business combinations, joint
ventures, collaborations, licensing arrangements or strategic alliances occurring after the date of this Agreement and not used
for capital raising purposes, and (iv) modification of any outstanding options, warrants of any rights to purchase or acquire
Common Shares; provided that, in the case of clause (iii), the aggregate number of Common Shares or securities convertible into
or exchangeable for Common Shares issued in connection with all such acquisitions and other transactions does not exceed 5% of
the aggregate number of Common Shares outstanding immediately prior to such transaction.


 



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Section 5. CONDITIONS TO DELIVERY
OF ISSUANCE NOTICES AND TO SETTLEMENT


 


(a)            Conditions
Precedent to the Right of the Company to Deliver an Issuance Notice and the Obligation of the Agent to Sell Shares. The right
of the Company to deliver an Issuance Notice hereunder is subject to the satisfaction, on the date of delivery of such Issuance
Notice, and the obligation of the Agent to use its commercially reasonable efforts to place Shares during the applicable period
set forth in the Issuance Notice is subject to the satisfaction, on each Trading Day during the applicable period set forth in
the Issuance Notice, of each of the following conditions:


 


		(i)	Accuracy of the Company’s Representations and Warranties; Performance by the Company.
The Company shall have delivered the certificate required to be delivered pursuant to Section 4(p) on or before
the date on which delivery of such certificate is required pursuant to Section 4(p). The Company shall have performed,
satisfied and complied with all covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied
with by the Company at or prior to such date, including, but not limited to, the covenants contained in ‎Section 4(q),
Section 4(r) and Section 4(s).



 


		(ii)	No Injunction. No statute, rule, regulation, executive order, decree, ruling or injunction
shall have been enacted, entered, promulgated or endorsed by any court or governmental authority of competent jurisdiction or any
self-regulatory organization having authority over the matters contemplated hereby that prohibits or directly and materially adversely
affects any of the transactions contemplated by this Agreement, and no proceeding shall have been commenced that may have the effect
of prohibiting or materially adversely affecting any of the transactions contemplated by this Agreement.



 


		(iii)	Material Adverse Changes. Except as disclosed in the Prospectus and the Time of Sale Information,
(a) in the judgment of the Agent there shall not have occurred any Material Adverse Change; and (b) there shall not have
occurred any downgrading, nor shall any notice have been received by the Company of any intended or potential downgrading or of
any review for a possible change that does not indicate the direction of the possible change, in the rating accorded any securities
of the Company or the Subsidiary by any “nationally recognized statistical rating organization” as such term is defined
for purposes of Section 3(a)(62) of the Exchange Act.



 


		(iv)	No Suspension of Trading in or Delisting of Common Shares; Other Events. The trading of
the Common Shares (including without limitation the Shares) shall not have been suspended by the Commission, the Principal Market
or FINRA and the Common Shares (including without limitation the Shares) shall have been approved for listing or quotation on and
shall not have been delisted from the Nasdaq Stock Market, the New York Stock Exchange or any of their constituent markets. There
shall not have occurred (and be continuing in the case of occurrences under clauses (i) and (ii) below) any of the
following: (i) trading or quotation in any of the Company’s securities shall have been suspended or limited by the Commission
or by the Principal Market or trading in securities generally on either the Principal Market shall have been suspended or limited,
or minimum or maximum prices shall have been generally established on any of such stock exchanges by the Commission or FINRA; (ii) a
general banking moratorium shall have been declared by any of U.S. or Canadian federal or New York or Québec, authorities;
or (iii) there shall have occurred any outbreak or escalation of national or international hostilities or any crisis or calamity,
or any change in the United States, Canadian or international financial markets, or any substantial change or development involving
a prospective substantial change in United States’, Canadian or international political, financial or economic conditions,
as in the judgment of the Agent is material and adverse and makes it impracticable to market the Shares in the manner and on the
terms described in the Prospectus or to enforce contracts for the sale of securities.



 






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		(v)	Section 12 Authorization. Any order or notice of approval granted or otherwise issued
by the AMF under Section 12 of the Securities Act (Québec) (the “Québec Securities Act”)
shall remain in full force and effect or the Company shall be entitled to rely on the non-objection of the AMF within the time
period prescribed by Section 12 of the Québec Securities Act to make sales of Common Shares to persons established
outside the Province of Québec, Canada.



 


(b)            Documents
Required to be Delivered on each Issuance Notice Date. The Agent’s obligation to use its commercially reasonable efforts
to place Shares hereunder shall additionally be conditioned upon the delivery to the Agent on or before the Issuance Notice Date
of a certificate in form and substance reasonably satisfactory to the Agent, executed by the Chief Executive Officer,
President or Chief Financial Officer of the Company, to the effect that all conditions to the delivery of such Issuance
Notice shall have been satisfied as at the date of such certificate as required to be delivered pursuant to Section 4(p) (which
certificate shall not be required if the foregoing representations shall be set forth in the Issuance Notice).


 


(c)            No
Misstatement or Material Omission. Agent shall not have advised the Company that the Registration Statement, the Prospectus
or the Time of Sale Information, or any amendment or supplement thereto, contains an untrue statement of fact that in the Agent’s
reasonable opinion is material, or omits to state a fact that in the Agent’s reasonable opinion is material and is required
to be stated therein or is necessary to make the statements therein not misleading.


 


(d)            Agent
Counsel Legal Opinions. Agent shall have received from Wilmer Cutler Pickering Hale & Dorr LLP, U.S. counsel to the
Agent, such opinion or opinions, on or before the date on which the delivery of the Company counsel legal opinions are required
pursuant to Section 4(q), with respect to such matters as Agent may reasonably require, and the Company shall have furnished
to such counsel such documents as they reasonably request for enabling them to pass upon such matters.


 






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Section 6. INDEMNIFICATION AND CONTRIBUTION


 


(a)            Indemnification
of the Agent. The Company agrees to indemnify and hold harmless the Agent, its officers and employees, and each person, if
any, who controls the Agent within the meaning of the Securities Act or the Exchange Act against any loss, claim, damage, liability
or expense, as incurred, to which the Agent or such officer, employee or controlling person may become subject, under the Securities
Act, the Exchange Act, other federal or state or provincial statutory law or regulation, or the laws or regulations of foreign
jurisdictions where Shares have been offered or sold or at common law or otherwise (including in settlement of any litigation),
insofar as such loss, claim, damage, liability or expense (or actions in respect thereof as contemplated below) arises out of or
is based upon (i) any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement,
or any amendment thereto, including any information deemed to be a part thereof pursuant to Rule 430B under the Securities
Act, or the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the
statements therein not misleading; or (ii) any untrue statement or alleged untrue statement of a material fact contained in
any Free Writing Prospectus that the Company has used, referred to or filed, or is required to file, pursuant to Rule 433(d) of
the Securities Act or the Prospectus (or any amendment or supplement thereto), or the omission or alleged omission to state therein
a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances
under which they were made, not misleading; and to reimburse the Agent and each such officer, employee and controlling person for
any and all reasonable expenses (including the reasonable and documented fees and disbursements of counsel chosen by the Agent)
as such expenses are reasonably incurred and documented by the Agent or such officer, employee or controlling person in connection
with investigating, defending, settling, compromising or paying any such loss, claim, damage, liability, expense or action; provided,
however, that the foregoing indemnity agreement shall not apply to any loss, claim, damage, liability or expense to the extent,
but only to the extent, arising out of or based upon any untrue statement or alleged untrue statement or omission or alleged omission
made in reliance upon and in conformity with written information furnished to the Company by the Agent expressly for use in the
Registration Statement, any such Free Writing Prospectus or the Prospectus (or any amendment or supplement thereto), it being understood
and agreed that the only such information furnished by the Agent to the Company consists of the information described in subsection
(b) below. The indemnity agreement set forth in this ‎Section 6(a)  shall be in addition to any liabilities
that the Company may otherwise have.


 


(b)            Indemnification
of the Company and its Directors and Officers. The Agent agrees to indemnify and hold
harmless the Company, each of its directors, each of its officers who signed the Registration Statement, and each person, if any,
who controls the Company within the meaning of the Securities Act or the Exchange Act, against any loss, claim, damage, liability
or expense, as incurred, to which the Company, or any such director, officer, or controlling person may become subject, under the
Securities Act, the Exchange Act, or other federal or state or provincial statutory law or regulation, or the laws or regulations
of foreign jurisdictions where Shares have been offered or sold, or at common law or otherwise
(including in settlement of any litigation,), insofar as such loss, claim, damage, liability or expense (or actions in respect
thereof as contemplated below) arises out of or is based upon (i) any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement, or any amendment thereto, including any information deemed to be a part thereof
pursuant to Rule 430B under the Securities Act, or the omission or alleged omission
to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading or (ii) any
untrue statement or alleged untrue statement of a material fact contained in any Free Writing Prospectus that the Company has used,
referred to or filed, or is required to file, pursuant to Rule 433(d) of the Securities Act or the Prospectus (or any
amendment or supplement thereto) or the omission or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements, in the light of the circumstances under which
they were made, not misleading, in each case to the extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in the Registration Statement, Free Writing Prospectus or the Prospectus (or
any such amendment or supplement), in reliance upon and in conformity with written information relating to the Agent furnished
to the Company by the Agent expressly for use therein; and to reimburse the Company, or any such director, officer, or controlling
person for any and all reasonable expenses (including the reasonable and documented fees and disbursements of counsel) as such
expenses are reasonably incurred and documented by the Company, or any such director, officer, or controlling person in connection
with investigating, defending, settling, compromising or paying any such loss, claim, damage, liability, expense or action. The
Company hereby acknowledges that the only information that the Agent has furnished to the Company expressly for use in the Registration
Statement, any Free Writing Prospectus that the Company has filed, or is required to file, pursuant to Rule 433(d) of
the Securities Act or the Prospectus (or any amendment or supplement to the foregoing) consists of the information set forth in
the first sentence of the ninth paragraph under the caption “Plan of Distribution” in the Prospectus. The indemnity
agreement set forth in this Section 6(b) shall be in addition to any liabilities that the Agent may otherwise
have.


 






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(c)            Notifications
and Other Indemnification Procedures. Promptly after receipt by an indemnified party under this ‎Section 6
of notice of the commencement of any action, such indemnified party will, if a claim in respect thereof is to be made against an
indemnifying party under this ‎Section 6, notify the indemnifying party in writing of the commencement thereof,
but the omission so to notify the indemnifying party will not relieve the indemnifying party from any liability which it may have
to any indemnified party for contribution or otherwise than under the indemnity agreement contained in this ‎Section 6
or to the extent the indemnifying party is not prejudiced as a proximate result of such failure. In case any such action is brought
against any indemnified party and such indemnified party seeks or intends to seek indemnity from an indemnifying party, the indemnifying
party will be entitled to participate in, and, to the extent that it shall elect, jointly with all other indemnifying parties similarly
notified, by written notice delivered to the indemnified party promptly after receiving the aforesaid notice from such indemnified
party, to assume the defense thereof with counsel reasonably satisfactory to such indemnified party; provided, however, if the
defendants in any such action include both the indemnified party and the indemnifying party and the indemnified party shall have
reasonably concluded based on the advice of counsel that a conflict may arise between the positions of the indemnifying party and
the indemnified party in conducting the defense of any such action or that there may be legal defenses available to it and/or other
indemnified parties which are different from or additional to those available to the indemnifying party, the indemnified party
or parties shall have the right to select separate counsel to assume such legal defenses and to otherwise participate in the defense
of such action on behalf of such indemnified party or parties. Upon receipt of notice from the indemnifying party to such indemnified
party of such indemnifying party’s election so to assume the defense of such action and approval by the indemnified party
of counsel, the indemnifying party will not be liable to such indemnified party under this ‎Section 6 for any legal
or other expenses subsequently incurred by such indemnified party in connection with the defense thereof unless (i) the indemnified
party shall have employed separate counsel in accordance with the proviso to the preceding sentence (it being understood, however,
that the indemnifying party shall not be liable for the fees and expenses of more than one separate counsel (together with local
counsel), representing the indemnified parties who are parties to such action), which counsel (together with any local counsel)
for the indemnified parties shall be selected by the Agent (in the case of counsel for the indemnified parties referred to in ‎Section 6(a) above),
(ii) the indemnifying party shall not have employed counsel satisfactory to the indemnified party to represent the indemnified
party within a reasonable time after notice of commencement of the action or (iii) the indemnifying party has authorized in
writing the employment of counsel for the indemnified party at the expense of the indemnifying party, in each of which cases the
fees and expenses of counsel shall be at the expense of the indemnifying party and shall be paid as they are incurred.


 






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(d)            Settlements.
The indemnifying party under this ‎Section 6 shall not be liable for any settlement of any proceeding effected
without its written consent, but if settled with such consent or if there be a final judgment for the plaintiff, the indemnifying
party agrees to indemnify the indemnified party against any loss, claim, damage, liability or expense by reason of such settlement
or judgment. Notwithstanding the foregoing sentence, if at any time an indemnified party shall have requested an indemnifying party
to reimburse the indemnified party for fees and expenses of counsel as contemplated by ‎Section 6(b) hereof,
the indemnifying party shall be liable for any settlement of any proceeding effected without its written consent if (i) such
settlement is entered into more than 30 days after receipt by such indemnifying party of the aforesaid request; and (ii) such
indemnifying party shall not have reimbursed the indemnified party in accordance with such request prior to the date of such settlement.
No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement, compromise or consent
to the entry of judgment in any pending or threatened action, suit or proceeding in respect of which any indemnified party is or
could have been a party and indemnity was or could have been sought hereunder by such indemnified party, unless such settlement,
compromise or consent includes an unconditional release of such indemnified party from all liability on claims that are the subject
matter of such action, suit or proceeding.


 


(e)            Contribution.
If the indemnification provided for in this ‎Section 6 is for any reason held to be unavailable to or otherwise
insufficient to hold harmless an indemnified party in respect of any losses, claims, damages, liabilities or expenses referred
to therein, then each indemnifying party shall contribute to the aggregate amount paid or payable by such indemnified party, as
incurred, as a result of any losses, claims, damages, liabilities or expenses referred to therein (i) in such proportion as
is appropriate to reflect the relative benefits received by the Company, on the one hand, and the Agent, on the other hand, from
the offering of the Shares pursuant to this Agreement; or (ii) if the allocation provided by clause (i) above is
not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in
clause (i) above but also the relative fault of the Company, on the one hand, and the Agent, on the other hand, in connection
with the statements or omissions which resulted in such losses, claims, damages, liabilities or expenses, as well as any other
relevant equitable considerations. The relative benefits received by the Company, on the one hand, and the Agent, on the other
hand, in connection with the offering of the Shares pursuant to this Agreement shall be deemed to be in the same respective proportions
as the total gross proceeds from the offering of the Shares pursuant to this Agreement (before deducting expenses) received by
the Company bear to the total Selling Commission received by the Agent. The relative fault of the Company, on the one hand, and
the Agent, on the other hand, shall be determined by reference to, among other things, whether any such untrue or alleged untrue
statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by the Company,
on the one hand, or the Agent, on the other hand, and the parties’ relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.


 






    	 	31	 



     


    

 


The amount paid or
payable by a party as a result of the losses, claims, damages, liabilities and expenses referred to above shall be deemed to include,
subject to the limitations set forth in ‎Section 6(c), any legal or other fees or expenses reasonably incurred
by such party in connection with investigating or defending any action or claim. The provisions set forth in ‎Section 6(c) with
respect to notice of commencement of any action shall apply if a claim for contribution is to be made under this ‎Section 6(c);
provided, however, that no additional notice shall be required with respect to any action for which notice has been given
under ‎Section 6(c) for purposes of indemnification.


 


The Company and the Agent agree that it
would not be just and equitable if contribution pursuant to this ‎Section 6(e) were determined by pro rata
allocation or by any other method of allocation which does not take account of the equitable considerations referred to in this
‎Section 6(e).


 


Notwithstanding the
provisions of this ‎Section 6(e), the Agent shall not be required to contribute any amount in excess of the Selling
Commission received by the Agent in connection with the offering contemplated hereby. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation. For purposes of this ‎Section 6(e), each officer and employee
of the Agent and each person, if any, who controls the Agent within the meaning of the Securities Act or the Exchange Act shall
have the same rights to contribution as the Agent, and each director of the Company, each officer of the Company who signed the
Registration Statement, and each person, if any, who controls the Company within the meaning of the Securities Act and the Exchange
Act shall have the same rights to contribution as the Company.


 


Section 7. TERMINATION & SURVIVAL


 


(a)            Term.
Subject to the provisions of this ‎Section 7, the term of this Agreement shall continue from the date of this Agreement
until the end of the Agency Period, unless earlier terminated by the parties to this Agreement pursuant to this ‎Section 7.


 


(b)            Termination;
Survival Following Termination.


 


		(i)	Either party may terminate this Agreement prior to the end of the Agency Period, by giving written
notice as required by this Agreement, upon five (5) Trading Days’ notice to the other party; provided that, (A) if
the Company terminates this Agreement after the Agent confirms to the Company any sale of Shares, the Company shall remain obligated
to comply with ‎Section 3(b)(v) with respect to such Shares and (B) ‎Section 2,
‎Section 6, ‎Section 7 and ‎Section 8 shall survive termination of this Agreement.
If termination shall occur prior to the Settlement Date for any sale of Shares, such sale shall nevertheless settle in accordance
with the terms of this Agreement.



 


		(ii)	In addition to the survival provision of ‎Section 7(b)(i),
the respective indemnities, agreements, representations, warranties and other statements of the Company, of its officers and of
the Agent set forth in or made pursuant to this Agreement will remain in full force and effect, regardless of any investigation
made by or on behalf of the Agent or the Company or any of its or their partners, officers or directors or any controlling person,
as the case may be, and, anything herein to the contrary notwithstanding, will survive delivery of and payment for the Shares
sold hereunder and any termination of this Agreement.



 






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Section 8. MISCELLANEOUS


 


(a)            Press
Releases and Disclosure. The Company may issue a press release describing the material terms of the transactions contemplated
hereby as soon as practicable following the date of this Agreement, and may file with the Commission a Current Report on Form 8-K,
with this Agreement attached as an exhibit thereto, describing the material terms of the transactions contemplated hereby, and
the Company shall consult with the Agent prior to making such disclosures, and the parties hereto shall use all commercially reasonable
efforts, acting in good faith, to agree upon a text for such disclosures that is reasonably satisfactory to all parties hereto.
No party hereto shall issue thereafter any press release or like public statement (including, without limitation, any disclosure
required in reports filed with the Commission pursuant to the Exchange Act) related to this Agreement or any of the transactions
contemplated hereby without the prior written approval of the other party hereto, except as may be necessary or appropriate in
the reasonable opinion of the party seeking to make disclosure to comply with the requirements of applicable law or stock exchange
rules. If any such press release or like public statement is so required, the party making such disclosure shall consult with the
other party prior to making such disclosure, and the parties shall use all commercially reasonable efforts, acting in good faith,
to agree upon a text for such disclosure that is reasonably satisfactory to all parties hereto.


 


(b)            No
Advisory or Fiduciary Relationship. The Company acknowledges and agrees that (i) the transactions contemplated by this
Agreement, including the determination of any fees, are arm’s-length commercial transactions between the Company and the
Agent, (ii) when acting as a principal under this Agreement, the Agent is and has been acting solely as a principal and is
not the agent or fiduciary of the Company, or its stockholders, creditors, employees or any other party, (iii) the Agent has
not assumed nor will assume an advisory or fiduciary responsibility in favor of the Company with respect to the transactions contemplated
hereby or the process leading thereto (irrespective of whether the Agent has advised or is currently advising the Company on other
matters) and the Agent does not have any obligation to the Company with respect to the transactions contemplated hereby except
the obligations expressly set forth in this Agreement, (iv) the Agent and its respective affiliates may be engaged in a broad
range of transactions that involve interests that differ from those of the Company, and (v) the Agent has not provided any
legal, accounting, regulatory or tax advice with respect to the transactions contemplated hereby and the Company has consulted
its own legal, accounting, regulatory and tax advisors to the extent it deemed appropriate.


 


(c)            Research
Analyst Independence. The Company acknowledges that the Agent’s research analysts and research departments are required
to and should be independent from their respective investment banking divisions and are subject to certain regulations and internal
policies, and as such the Agent’s research analysts may hold views and make statements or investment recommendations and/or
publish research reports with respect to the Company or the offering that differ from the views of their respective investment
banking divisions. The Company understands that the Agent is a full service securities firm and as such from time to time, subject
to applicable securities laws, may effect transactions for its own account or the account of its customers and hold long or short
positions in debt or equity securities of the companies that may be the subject of the transactions contemplated by this Agreement.


 






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(d)            Notices.
All communications hereunder shall be in writing and shall be mailed, hand delivered or telecopied and confirmed to the parties
hereto as follows:


 


If
to the Agent:


 


Jefferies LLC

520 Madison Avenue

New York, NY 10022

Facsimile:

Attention: General Counsel


 


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


 


Wilmer Cutler Pickering Hale and Dorr LLP

7 World Trade Center

250 Greenwich Street

New York, New York 10007

Facsimile: (212) 230-8888

Attention: Lisa Firenze


 


If to the Company:


 


Milestone Pharmaceuticals Inc.

1111, Dr. Frederik-Philips Blvd.

Suite 420

Montréal, Québec H4M 2XC

Attention: Joseph G. Oliveto, President and CEO


 


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


 


Cooley LLP

500 Boylston Street

Boston, Massachusetts 02116

Facsimile: (617) 937-2400

Attention: Marc Recht


 


Any party hereto may change the address
for receipt of communications by giving written notice to the others in accordance with this ‎Section 8(d).


 


(e)            Successors.
This Agreement will inure to the benefit of and be binding upon the parties hereto, and to the benefit of the employees, officers
and directors and controlling persons referred to in ‎Section 6, and in each case their respective successors,
and no other person will have any right or obligation hereunder. The term “successors” shall not include any purchaser
of the Shares as such from the Agent merely by reason of such purchase.


 






    	 	34	 



     


    

 


(f)            Partial
Unenforceability. The invalidity or unenforceability of any Article, Section, paragraph or provision of this Agreement shall
not affect the validity or enforceability of any other Article, Section, paragraph or provision hereof. If any Article, Section,
paragraph or provision of this Agreement is for any reason determined to be invalid or unenforceable, there shall be deemed to
be made such minor changes (and only such minor changes) as are necessary to make it valid and enforceable.


 


(g)            Governing
Law Provisions. This Agreement shall be governed by and construed in accordance with the internal laws of the State of New
York applicable to agreements made and to be performed in such state. Any legal suit, action or proceeding arising out of or based
upon this Agreement or the transactions contemplated hereby may be instituted in the federal courts of the United States of America
located in the Borough of Manhattan in the City of New York or the courts of the State of New York in each case located in the
Borough of Manhattan in the City of New York (collectively, the “Specified Courts”), and each party irrevocably
submits to the exclusive jurisdiction (except for proceedings instituted in regard to the enforcement of a judgment of any such
court, as to which such jurisdiction is non-exclusive) of such courts in any such suit, action or proceeding. Service of any process,
summons, notice or document by mail to such party’s address set forth above shall be effective service of process for any
suit, action or other proceeding brought in any such court. The parties irrevocably and unconditionally waive any objection to
the laying of venue of any suit, action or other proceeding in the Specified Courts and irrevocably and unconditionally waive and
agree not to plead or claim in any such court that any such suit, action or other proceeding brought in any such court has been
brought in an inconvenient forum. The Company has irrevocably appointed Milestone Pharmaceuticals USA Inc., which currently maintains
an office at 6000 Fairview Road, Suite 1200, Charlotte, North Carolina 28210-2252, United States of America, as its agent
to receive service of process or other legal summons for purposes of any such suit, action or proceeding that may be instituted
in any state or federal court in the Borough of Manhattan in the City of New York.


 


(h)            General
Provisions. This Agreement constitutes the entire agreement of the parties to this Agreement and supersedes all prior written
or oral and all contemporaneous oral agreements, understandings and negotiations with respect to the subject matter hereof. This
Agreement may be executed in two or more counterparts, each one of which shall be an original, with the same effect as if the signatures
thereto and hereto were upon the same instrument, and may be delivered by facsimile transmission or by electronic delivery of a
portable document format (PDF) file. The words “execution,” “execute”, “signed,” “sign,”
“signature,” and words of like import in or related to any document to be signed in connection with this Agreement
and the transactions contemplated hereby shall be deemed to include electronic signatures, or the keeping of records in electronic
form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of
a paper- based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the
Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or
any other similar state laws based on the Uniform Electronic Transactions Act. This Agreement may not be amended or modified unless
in writing by all of the parties hereto, and no condition herein (express or implied) may be waived unless waived in writing by
each party whom the condition is meant to benefit. The Article and Section headings herein are for the convenience of
the parties only and shall not affect the construction or interpretation of this Agreement.


 






    	 	35	 



     


    

 


[Signature Page Immediately Follows]


 




    	 	36	 



     


    

 


If the foregoing is
in accordance with your understanding of our agreement, kindly sign and return to the Company the enclosed copies hereof, whereupon
this instrument, along with all counterparts hereof, shall become a binding agreement in accordance with its terms


 


	 	Very truly yours,
	 	 	 	 
	 	MILESTONE PHARMACEUTICALS INC.
	 	By:	/s/ Joseph Oliveto
	 	 	Name:	Joseph Oliveto
	 	 	Title:	Chief Executive Officer


 


The foregoing Agreement is hereby confirmed
and accepted by the Agent in New York, New York as of the date first above written.


 


	JEFFERIES LLC	 
	 	 	 	 
	By:	/s/
    Matthew Kim	 
	 	Name:	Matthew Kim	 
	 	Title:	Managing Director	 


 




    	 	 	 



     


    

 


EXHIBIT A


 


ISSUANCE NOTICE


 


[Date]


 


Jefferies LLC


520 Madison Avenue


New York, New York 10022


 


Attn: [__________]


 


Reference is made to the Open Market Sale
Agreement between Milestone Pharmaceuticals Inc. (the “Company”) and Jefferies LLC (the “Agent”)
dated as of ________ ___, 2020. The Company confirms that all conditions to the delivery of this Issuance Notice are satisfied
as of the date hereof.


 


Date of Delivery of Issuance Notice (determined pursuant to
‎Section 3(b)(i)): _______________________


 


Issuance Amount (equal to the total Sales Price for such Shares):


 


	 	$	 	 
	 	 	 	 
	Number of days in selling period:	 	 	 
	 	 	 	 
	First date of selling period:	 	 	 
	 	 	 	 
	Last date of selling period:	 	 	 
	 	 	 	 
	Settlement Date(s) if other than standard T+2 settlement:
	 
	 	 	 	 



 


Floor Price Limitation (in no event less
than $1.00 without the prior written consent of the Agent, which consent may be withheld in the Agent’s sole discretion):
$ ____ per share


 


	Comments:	 



 


	 	By:	 
	 	 	Name:	 
	 	 	Title:	 



 




    	 	A-1	 



     


    

 


Schedule A


 


Notice Parties


 


The Company


 


Joseph Oliveto


 


Amit Hasija


 


The Agent


 


Donald Lynaugh


 


Michael Magarro


 


Matthew Kim