Exhibit
4.01


 


CERTIFICATE
OF DESIGNATIONS

SERIES A CONVERTIBLE PREFERRED STOCK

OF LIXTE BIOTECHNOLOGY HOLDINGS, INC.

(pursuant to Section 151 of the Delaware General Corporation Law)


 


Lixte
Biotechnology Holdings, Inc., a corporation organized and existing under the laws of the State of Delaware (the “Corporation”),
hereby certifies that the Board of Directors of the Corporation (the “Board of Directors” or the “Board”)
pursuant to authority of the Board of Directors under Section 151 of the Delaware General Corporation Law (“DGCL”),
and in accordance with the provisions of its Certificate of Incorporation and Bylaws, adopted the following resolution on March
5, 2015, which authorizes a series of the Corporation’s Preferred Stock, par value $0.0001 per share designated Series A
Preferred Stock (the “Preferred Stock”):


 


RESOLVED,
that a series of Preferred Stock in the Corporation, having the rights, preferences, privileges and restrictions, and the number
of shares constituting such series and the designation of such series, set forth below be, and it hereby is, authorized by the
Board of Directors of the Corporation pursuant to authority given by the Corporation’s Certificate of Incorporation.


 


NOW,
THEREFORE, BE IT RESOLVED, that the Board of Directors hereby fixes and determines the number of shares constituting, and the
rights, preferences, privileges and restrictions relating to, a new series of Preferred Stock designated Series A Preferred Stock
as follows:


 


Section
1. Definitions. For the purposes hereof, the following terms shall have the following meanings:


 


“Affiliate”
means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common
control with a Person, as such terms are used in and construed under Rule 405 of the Securities Act.


 


“Alternate
Consideration” shall have the meaning set forth in Section 7(d).


 


“Board
of Directors” means the board of directors of the Corporation.


 


“Business
Day” means any day except any Saturday, any Sunday, any day which is a federal legal holiday in the United States or
any day on which banking institutions in the State of New York are authorized or required by law or other governmental action
to close.


 


“Certificate
of Designations” means this Certificate of Designations of the Series A Convertible Preferred Stock


 


“Closing”
means the closing of the purchase and sale of the Securities pursuant to of the Purchase Agreement.


 


“Commission”
means the United States Securities and Exchange Commission.


 


“Common
Stock” means the Corporation’s common stock, par value $0.000041666 per share, and stock of any other class of
securities into which such securities may hereafter be reclassified or changed.


 


“Common
Stock Equivalents” means any securities of the Corporation or the Subsidiaries which would entitle the holder thereof
to acquire at any time Common Stock, including, without limitation, any debt, preferred stock, rights, options, warrants or other
instrument that is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to
receive, Common Stock.


 



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“Conversion
Date” shall have the meaning set forth in Section 6(a).


 


“Conversion
Price” shall have the meaning set forth in Section 6(b).


 


“Conversion
Shares” means, collectively, the shares of Common Stock issuable upon conversion of the shares of Preferred Stock in
accordance with the terms hereof.


 


“Corporation”
means Lixte Biotechnology Holdings, Inc., a Delaware corporation.


 


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


 


“Exempt
Issuance” means the issuance of (a) shares of Common Stock or options to employees, consultants, officers or
directors of the Corporation pursuant to any stock or option plan duly adopted for such purpose, by a majority of the
non-employee members of the Board of Directors of the Corporation or a majority of the members of a committee of non-employee
directors established for such purpose, (b) securities upon the exercise or exchange of or conversion of any securities
issued pursuant to the Purchase Agreement and/or other securities exercisable or exchangeable for or convertible into shares
of Common Stock issued and outstanding on the date of the Purchase Agreement or as disclosed in the Corporation’s
disclosure schedules to the Purchase Agreement, provided that such securities have not been amended on or after the date of
the Purchase Agreement to increase the number of such securities or to decrease the exercise price, exchange price or
conversion price of such securities and (c) securities issued pursuant to acquisitions or strategic transactions approved by
a majority of the disinterested directors of the Corporation, provided that any such issuance shall only be to a Person (or
to the equity holders of a Person) which is, itself or through its subsidiaries, an operating company or an owner of an asset
in a business synergistic with the business of the Corporation and shall provide to the Corporation additional benefits in
addition to the investment of funds, but shall not include a transaction in which the Corporation is issuing securities
primarily for the purpose of raising capital or to an entity whose primary business is investing in securities, and (d)
Common Stock and/or Common Stock purchase warrants as payment, in full or part, of up to $2,000,000 of liabilities and other
indebtedness owed by the Corporation as of the date of this Agreement to certain of its vendors, creditors, professionals and
other obligees.


 


“Fundamental
Transaction” shall have the meaning set forth in Section 7(d).


 


“GAAP”
means United States generally accepted accounting principles.


 


“Holder”
shall have the meaning given such term in Section 2.


 


“Junior
Securities” means the Common Stock and all other Common Stock Equivalents of the Corporation other than those securities
which are explicitly senior or pari passu to the Preferred Stock in dividend rights or liquidation preference.


 


“Liquidation”
shall have the meaning set forth in Section 5.


 


“Mandatory
Conversion Time” shall have the meaning set forth in Section 8(a).


 


“Notice
of Conversion” shall have the meaning set forth in Section 6(a).


 




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“Original
Issue Date” means the date of the first issuance of any shares of the Preferred Stock regardless of the number of transfers
of any particular shares of Preferred Stock and regardless of the number of certificates which may be issued to evidence such
Preferred Stock.


 


“Person”
means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability
company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.


 


“Preferred
Stock” shall have the meaning set forth in Section 2.


 


“Purchase
Agreement” means the Securities Purchase Agreement, dated on or about the Original Issue Date, among the Corporation
and the original Holders, as amended, modified or supplemented from time to time in accordance with its terms for the purchase
and sale of Common Stock, and Preferred Stock.


 


“Rule
144” means Rule 144 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended from time
to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same effect as such Rule.


 


“Sale
Transaction” shall mean any of the following which results in gross proceeds of at least $21,875,000:


 


(a)
the consolidation, merger or other business combination of the Corporation with or into another entity (other than a consolidation,
merger or other business combination in which holders of the Corporation’s voting power immediately prior to the transaction
continue after the transaction to hold, directly or indirectly, in substantially the same proportion as immediately preceding
the transaction, the voting power of the surviving entity or entities necessary to elect a majority of the members of the board
of directors (or their equivalent if other than a corporation) of such entity or entities);


 


(b)
the sale, lease, transfer, exclusive license or other disposition, in a single transaction or series of related transactions,
by the Corporation or any subsidiary of the Corporation (including, without limitation, any such action effected by the Corporation
or any subsidiary of the Corporation by merger, consolidation or otherwise) of all or substantially all of the intellectual property
or assets of the Corporation and its subsidiaries, taken as a whole, or the sale or disposition (including, without limitation,
any such action effected by the Corporation or any subsidiary of the Corporation by merger, consolidation or otherwise) of one
or more subsidiaries of the Corporation if substantially all of the assets of the Corporation and its subsidiaries taken as a
whole are held by such subsidiary or subsidiaries;


 


(c)
the sale, in a single transaction or series of transactions, of Common Stock and/or Preferred Stock (“Capital Stock”)
to any purchaser (a “Purchaser”) who, with the Purchaser’s affiliates, Beneficially Owns (without giving
effect to any blocking provisions that would otherwise serve to limit the Purchaser’s ability to exercise purchase rights,
conversion rights or other rights to acquire Capital Stock) immediately after such purchase all of the outstanding Capital Stock
of the Corporation.


 


“Securities”
means the Common Stock, Preferred Stock, the Warrants, the Warrant Shares and the Underlying Shares subject to the Purchase Agreement.


 


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


 


“Share
Delivery Date” shall have the meaning set forth in Section 6(c).


 


“Stated
Value” shall have the meaning set forth in Section 2, as the same may be increased pursuant to Section 3.


 






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“Subsidiary”
means any subsidiary of the Corporation.


 


“Successor
Entity” shall have the meaning set forth in Section 7(d).


 


“Trading
Day” means a day on which the principal Trading Market is open for business.








 


“Trading
Market” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on
the date in question: the NYSE MKT LLC, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market,
the New York Stock Exchange, OTC Markets, or the OTC Bulletin Board (or any successors to any of the foregoing).








 


“Transaction
Documents” means this Certificate of Designation, the Purchase Agreement, all exhibits and schedules thereto and hereto
and any other documents or agreements executed in connection with the transactions contemplated pursuant to the Purchase Agreement.


 


“Transfer
Agent” means Computer share, the current transfer agent of the Corporation, and any successor transfer agent of the
Corporation.


 


“Underlying
Shares” means the shares of Common Stock issued and issuable upon conversion of the Preferred Stock.


 


“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then
listed or quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest
preceding date) on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based
on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if the OTC Bulletin Board is not
a Trading Market, the volume weighted average price of the Common Stock for such date (or the nearest preceding date) on the OTC
Bulletin Board, (c) if the Common Stock is not then listed or quoted for trading on the OTC Bulletin Board and if prices for the
Common Stock are then reported in the “Pink Sheets” published by Pink OTC Markets, Inc. (or a similar organization
or agency succeeding to its functions of reporting prices), the most recent bid price per share of the Common Stock so reported,
or (d) in all other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected
in good faith by the Holders of a majority in interest of the Preferred Stock then outstanding and reasonably acceptable to the
Corporation, the fees and expenses of which shall be paid by the Corporation.








 


Section
2. Designation, Amount and Par Value. The series of preferred stock shall be designated as its Series A Convertible
Preferred Stock (the “Preferred Stock”) and the number of shares so designated shall be 175,000 (which shall
not be subject to increase without the written consent of all of the holders of the Preferred Stock (each, a “Holder”
and collectively, the “Holders”)). Each share of Preferred Stock shall have a par value of $0.0001 per share
and a stated value equal to $10.00, subject to increase set forth in Section 3 below (the “Stated Value”).


 


Section
3. Dividends.


 


(a)
Holders shall be entitled to receive, and the Corporation shall pay, a dividend on each share of Preferred Stock equal to 1% of
the annual net revenue of the Corporation divided by 175,000. In the event that the number of shares of Preferred Stock outstanding
shall be reduced by reason of conversion, redemption or otherwise, the amount of dividend shall be proportionately reduced. The
dividend, if any, shall be paid within ten business days from the completion of the Corporation’s audit for the applicable
fiscal year. As used herein “net revenue” shall mean the gross revenue arising from the sale or licensing of products
or intellectual property of the Corporation less returns, discounts and customary allowances. For avoidance of doubt, the dividend
does not include amounts attributable to a Sale Transaction.


 






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(b)
So long as any shares of Preferred Stock remain outstanding, neither the Corporation nor any subsidiary thereof shall redeem,
purchase or otherwise acquire directly or indirectly any material amount of Junior Securities.


 


Section
4. Voting Rights. Except as otherwise provided herein or as otherwise required by law, the Preferred Stock shall have
no voting rights. However, as long as any shares of Preferred Stock are outstanding, the Corporation shall not, without the affirmative
vote of the Holders of at least a majority in Stated Value of Preferred Stock, except as may be necessary to increase the authorized
shares of Common Stock in order to account for any increase in the number of shares issuable upon conversion of the Preferred
Stock, (a) alter or change adversely the powers, preferences or rights given to the Preferred Stock or alter or amend this Certificate
of Designations, (b) authorize or create any class of stock ranking as to dividends, redemption or distribution of assets upon
a Liquidation (as defined in Section 5) senior to the Preferred Stock, (c) amend its certificate of incorporation or other charter
documents in any manner that adversely affects any rights of the Holders, (d) increase the number of authorized shares of Preferred
Stock, or (e) enter into any agreement with respect to any of the foregoing.


 


Section
5. Liquidation. Upon any liquidation, dissolution or winding-up of the Corporation, whether voluntary or involuntary
(a “Liquidation”), the assets of the Corporation available for distribution to its stockholders shall be distributed
pari passu among the holders of the shares of Common Stock and Preferred Stock, pro rata based on the number of shares
held by each such holder, treating for this purpose all such securities as if they had been converted to Common Stock, pursuant
to the terms of the Certificate of Incorporation immediately prior to such liquidation, dissolution or winding up of the Corporation.
The Corporation shall mail written notice of any such Liquidation, not less than 45 days prior to the payment date stated therein,
to each Holder.


 


Section
6. Conversion.


 


(a)
Conversions at Option of Holder. Each share of Preferred Stock shall be convertible, at any time and from time to time
from and after the Original Issue Date at the option of the Holder thereof, into that number of shares of Common Stock (subject
to the limitations set forth in Section 6(d)) determined by multiplying each share of Preferred Stock by the Conversion Price.
Holders shall effect conversions by providing the Corporation with the form of conversion notice attached hereto as Annex A (a
“Notice of Conversion”). Each Notice of Conversion shall specify the number of shares of Preferred Stock to
be converted, the number of shares of Preferred Stock owned prior to the conversion at issue, the number of shares of Preferred
Stock owned subsequent to the conversion at issue and the date on which such conversion is to be effected, which date may not
be prior to the date the applicable Holder delivers by facsimile such Notice of Conversion to the Corporation (such date, the
“Conversion Date”). If no Conversion Date is specified in a Notice of Conversion, the Conversion Date shall
be the date that such Notice of Conversion to the Corporation is deemed delivered hereunder. The calculations and entries set
forth in the Notice of Conversion shall control in the absence of manifest or mathematical error. To effect conversions of shares
of Preferred Stock, a Holder shall not be required to surrender the certificate(s) representing the shares of Preferred Stock
to the Corporation unless (i) the full or remaining number of shares of Preferred Stock represented by such certificate are being
converted or (ii) such Holder has provided the Corporation with prior written notice (which notice may be included in a Notice
of Conversion) requesting reissuance of a certificate representing the remaining shares of Preferred Stock upon physical surrender
of any certificate representing the shares of Preferred Stock being converted. Each Holder and the Corporation shall maintain
records showing the number of shares of Preferred Stock so converted by such Holder and the dates of such conversions or shall
use such other method, reasonably satisfactory to such Holder and the Corporation, so as not to require physical surrender of
the certificate representing the shares of Preferred Stock upon each such conversion. In the event of any dispute or discrepancy,
such records of the Corporation establishing the number of shares of Preferred Stock to which the record holder is entitled shall
be controlling and determinative in the absence of manifest error. Shares of Preferred Stock converted into Common Stock in accordance
with the terms hereof shall be canceled and shall not be reissued.


 






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(b)
Conversion Price. The conversion price for the Preferred Stock shall equal $12.50, subject to adjustment herein (the “Conversion
Price”).


 


(c)
Mechanics of Conversion.


 


(i)
Delivery of Certificate Upon Conversion. Not later than three (3) Trading Days after each Conversion Date (the “Share
Delivery Date”), the Corporation shall deliver, or cause to be delivered, to the converting Holder (A) a certificate
or certificates free of restrictive legends representing the number of Conversion Shares being acquired upon the conversion of
the Preferred Stock, and (B) a bank check in the amount of accrued and unpaid dividends. If requested by the Holder, the Corporation
shall use its best efforts to deliver any certificate or certificates required to be delivered by the Corporation under this Section
6 electronically through the Depository Trust Company or another established clearing corporation performing similar functions.


 


(ii)
Failure to Deliver Certificates. If, in the case of any Notice of Conversion, such certificate or certificates are not
delivered to or as directed by the applicable Holder by the Share Delivery Date, the Holder shall be entitled to elect by written
notice to the Corporation at any time on or before its receipt of such certificate or certificates, to rescind such Conversion,
in which event the Corporation shall promptly return to the Holder any original Preferred Stock certificate delivered to the Corporation
and the Holder shall promptly return to the Corporation the Common Stock certificates issued to such Holder pursuant to the rescinded
Conversion Notice.


 


(iii)
Reservation of Shares Issuable Upon Conversion. The Corporation covenants that it will at all times reserve and keep available
out of its authorized and unissued shares of Common Stock for the sole purpose of issuance upon conversion of the Preferred Stock
as herein provided, free from preemptive rights or any other actual contingent purchase rights of Persons other than the Holder
(and the other holders of the Preferred Stock), not less than such aggregate number of shares of the Common Stock as shall (subject
to the terms and conditions set forth in the respective Purchase Agreement) be issuable (taking into account the adjustments and
restrictions of Section 7) upon the conversion of the then outstanding shares of Preferred Stock. The Corporation covenants that
all shares of Common Stock that shall be so issuable shall, upon issue, be duly authorized, validly issued, fully paid and nonassessable.


 


(iv)
Fractional Shares. No fractional shares or scrip representing fractional shares shall be issued upon the conversion of
the Preferred Stock. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such conversion,
the Corporation shall at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such
fraction multiplied by the Conversion Price or round up to the next whole share.


 


(v)
Transfer Taxes. The issuance of certificates for shares of the Common Stock on conversion of this Preferred Stock shall
be made without charge to any Holder for any documentary stamp or similar taxes that may be payable in respect of the issue or
delivery of such certificates, provided that the Corporation shall not be required to pay any tax that may be payable in respect
of any transfer involved in the issuance and delivery of any such certificate upon conversion in a name other than that of the
Holders of such shares of Preferred Stock and the Corporation shall not be required to issue or deliver such certificates unless
or until the Person or Persons requesting the issuance thereof shall have paid to the Corporation the amount of such tax or shall
have established to the satisfaction of the Corporation that such tax has been paid.


 


Section
7. Certain Adjustments.


 


(a)
Stock Dividends and Stock Splits. If the Corporation, at any time while this Preferred Stock is outstanding: (i) pays a
stock dividend or otherwise makes a distribution or distributions payable in shares of Common Stock on shares of Common Stock
or any other Common Stock Equivalents (which, for avoidance of doubt, shall not include any shares of Common Stock issued by the
Corporation upon conversion of this Preferred Stock), (ii) subdivides outstanding shares of Common Stock into a larger number
of shares, (iii) combines (including by way of a reverse stock split) outstanding shares of Common Stock into a smaller number
of shares, or (iv) issues, in the event of a reclassification of shares of the Common Stock, any shares of capital stock of the
Corporation, then the Conversion Price shall be multiplied by a fraction of which the numerator shall be the number of shares
of Common Stock (excluding any treasury shares of the Corporation) outstanding immediately before such event, and of which the
denominator shall be the number of shares of Common Stock outstanding immediately after such event. Any adjustment made pursuant
to this Section 7(a) shall become effective immediately after the record date for the determination of stockholders entitled to
receive such dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision,
combination or reclassification.


 






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(b)
Subsequent Rights Offerings. If the Corporation, at any time while the Preferred Stock is outstanding, shall issue rights,
options or warrants to all holders of Common Stock (and not proportionately to the Holders) entitling them to subscribe for or
purchase shares of Common Stock at a price per share that is lower than the VWAP on the record date for such issuance, and do
not offer the same rights to the Holders, then the Holder will be entitled to acquire, upon conversion of the Preferred Stock,
such rights, options or warrants which the Holder could have acquired if the Holder had held the number of shares of Common Stock
acquirable upon complete conversion of such Holder’s Preferred Stock (without regard to any limitations on the conversion
of such Preferred Stock) immediately before the date on which a record is taken for the issuance of such rights, options or warrants,
or, if no such record is taken, the date as of which the record holders of shares of Common Stock are to be determined for the
issuance of such rights, options or warrants.


 


(c)
Pro Rata Distributions. If the Corporation, at any time while this Preferred Stock is outstanding, distributes to all holders
of Common Stock (and not to the Holders) evidences of its indebtedness or assets (including cash and cash dividends) or rights
or warrants to subscribe for or purchase any security, then in each such case the Conversion Price shall be adjusted by multiplying
such Conversion Price in effect immediately prior to the record date fixed for determination of stockholders entitled to receive
such distribution by a fraction of which the denominator shall be the VWAP determined as of the record date mentioned above, and
of which the numerator shall be such VWAP on such record date less the then fair market value at such record date of the portion
of such assets or evidence of indebtedness or rights or warrants so distributed applicable to one outstanding share of the Common
Stock as determined by the Board of Directors of the Corporation in good faith. In either case the adjustments shall be described
in a statement delivered to the Holders describing the portion of assets or evidences of indebtedness so distributed or such subscription
rights applicable to one share of Common Stock. Such adjustment shall be made whenever any such distribution is made and shall
become effective immediately after the record date mentioned above.


 


(d)
Fundamental Transaction. If, at any time while this Preferred Stock is outstanding, (i) the Corporation, directly or indirectly,
in one or more related transactions effects any merger or consolidation of the Corporation with or into another Person, (ii) the
Corporation, directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of
all or substantially all of its assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer,
tender offer or exchange offer (whether by the Corporation or another Person) is completed pursuant to which holders of Common
Stock are permitted to sell, tender or exchange their shares for other securities, cash or property and has been accepted by the
holders of 50% or more of the outstanding Common Stock, (iv) the Corporation, directly or indirectly, in one or more related transactions
effects any reclassification, reorganization or recapitalization of the Common Stock or any compulsory share exchange pursuant
to which the Common Stock is effectively converted into or exchanged for other securities, cash or property, (v) the Corporation,
directly or indirectly, in one or more related transactions consummates a stock or share purchase agreement or other business
combination (including, without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with another
Person whereby such other Person acquires more than 50% of the outstanding shares of Common Stock (not including any shares of
Common Stock held by the other Person or other Persons making or party to, or associated or affiliated with the other Persons
making or party to, such stock or share purchase agreement or other business combination and excluding shares acquired upon conversion
of any currently outstanding convertible securities in accordance with the terms thereof as in effect on the date hereof) (each
a “Fundamental Transaction”), then, upon any subsequent conversion of this Preferred Stock, the Holder shall
have the right to receive, for each Conversion Share that would have been issuable upon such conversion immediately prior to the
occurrence of such Fundamental Transaction (without regard to any limitation in Section 6(d) and Section 6(e) on the conversion
of this Preferred Stock), the number of shares of Common Stock of the successor or acquiring corporation or of the Corporation,
if it is the surviving corporation, and any additional consideration (the “Alternate Consideration”) receivable
as a result of such Fundamental Transaction by a holder of the number of shares of Common Stock for which this Preferred Stock
is convertible immediately prior to such Fundamental Transaction (without regard to any limitation in Section 6(d) and Section
6(e) on the conversion of this Preferred Stock). For purposes of any such conversion, the determination of the Conversion Price
shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration issuable
in respect of one share of Common Stock in such Fundamental Transaction, and the Corporation shall apportion the Conversion Price
among the Alternate Consideration in a reasonable manner reflecting the relative value of any different components of the Alternate
Consideration. If holders of Common Stock are given any choice as to the securities, cash or property to be received in a Fundamental
Transaction, then the Holder shall be given the same choice as to the Alternate Consideration it receives upon any conversion
of this Preferred Stock following such Fundamental Transaction. To the extent necessary to effectuate the foregoing provisions,
any successor to the Corporation or surviving entity in such Fundamental Transaction shall file a new Certificate of Designations
with the same terms and conditions and issue to the Holders new preferred stock consistent with the foregoing provisions and evidencing
the Holders’ right to convert such preferred stock into Alternate Consideration. The Corporation shall cause any successor
entity in a Fundamental Transaction in which the Corporation is not the survivor (the “Successor Entity”) to
assume in writing all of the obligations of the Corporation under this Certificate of Designations and the other Transaction Documents
(as defined in the Purchase Agreement) in accordance with the provisions of this Section 7(d) pursuant to written agreements in
form and substance reasonably satisfactory to the Holder and approved by the Holder (without unreasonable delay) prior to such
Fundamental Transaction and shall, at the option of the holder of this Preferred Stock, deliver to the Holder in exchange for
this Preferred Stock a security of the Successor Entity evidenced by a written instrument substantially similar in form and substance
to this Preferred Stock which is convertible for a corresponding number of shares of capital stock of such Successor Entity (or
its parent entity) equivalent to the shares of Common Stock acquirable and receivable upon conversion of this Preferred Stock
(without regard to any limitations on the conversion of this Preferred Stock) prior to such Fundamental Transaction, and with
a conversion price which applies the conversion price hereunder to such shares of capital stock (but taking into account the relative
value of the shares of Common Stock pursuant to such Fundamental Transaction and the value of such shares of capital stock, such
number of shares of capital stock and such conversion price being for the purpose of protecting the economic value of this Preferred
Stock immediately prior to the consummation of such Fundamental Transaction), and which is reasonably satisfactory in form and
substance to the Holder. Upon the occurrence of any such Fundamental Transaction, the Successor Entity shall succeed to, and be
substituted for (so that from and after the date of such Fundamental Transaction, the provisions of this Certificate of Designation
and the other Transaction Documents referring to the “Corporation” shall refer instead to the Successor Entity), and
may exercise every right and power of the Corporation and shall assume all of the obligations of the Corporation under this Certificate
of Designation and the other Transaction Documents with the same effect as if such Successor Entity had been named as the Corporation
herein.


 






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(e)
Calculations. All calculations under this Section 7 shall be made to the nearest cent or the nearest 1/100th of a share,
as the case may be. For purposes of this Section 7, the number of shares of Common Stock deemed to be issued and outstanding as
of a given date shall be the sum of the number of shares of Common Stock (excluding any treasury shares of the Corporation) issued
and outstanding.


 


(f)
Notice to the Holders.


 


(i)
Adjustment to Conversion Price. Whenever the Conversion Price is adjusted pursuant to any provision of this Section 7,
the Corporation shall promptly deliver to each Holder a notice setting forth the Conversion Price after such adjustment and setting
forth a brief statement of the facts requiring such adjustment.


 


(ii)
Notice to Allow Conversion by Holder. If (A) the Corporation shall declare a dividend (or any other distribution in whatever
form) on the Common Stock, (B) the Corporation shall declare a special nonrecurring cash dividend on or a redemption of the Common
Stock, (C) the Corporation shall authorize the granting to all holders of the Common Stock of rights or warrants to subscribe
for or purchase any shares of capital stock of any class or of any rights, (D) the approval of any stockholders of the Corporation
shall be required in connection with any reclassification of the Common Stock, any consolidation or merger to which the Corporation
is a party, any sale or transfer of all or substantially all of the assets of the Corporation, or any compulsory share exchange
whereby the Common Stock is converted into other securities, cash or property or (E) the Corporation shall authorize the voluntary
or involuntary dissolution, liquidation or winding up of the affairs of the Corporation, then, in each case, the Corporation shall
cause to be filed at each office or agency maintained for the purpose of conversion of this Preferred Stock, and shall cause to
be delivered to each Holder at its last address as it shall appear upon the stock books of the Corporation, at least ten (10)
calendar days prior to the applicable record or effective date hereinafter specified, a notice stating (x) the date on which a
record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants, or if a record is not to
be taken, the date as of which the holders of the Common Stock of record to be entitled to such dividend, distributions, redemption,
rights or warrants are to be determined or (y) the date on which such reclassification, consolidation, merger, sale, transfer
or share exchange is expected to become effective or close, and the date as of which it is expected that holders of the Common
Stock of record shall be entitled to exchange their shares of the Common Stock for securities, cash or other property deliverable
upon such reclassification, consolidation, merger, sale, transfer or share exchange, provided that the failure to deliver such
notice or any defect therein or in the delivery thereof shall not affect the validity of the corporate action required to be specified
in such notice. To the extent that any notice provided hereunder constitutes, or contains, material, non-public information regarding
the Corporation or any of the Subsidiaries, the Corporation shall simultaneously file such notice with the Commission pursuant
to a Current Report on Form 8-K. The Holder shall remain entitled to convert the Conversion Amount of this Preferred Stock (or
any part hereof) during the 10-day period commencing on the date of such notice through the effective date of the event triggering
such notice except as may otherwise be expressly set forth herein.


 






    	Exhibit 4.01 - Page 8



    	 



    

 


Section
8. Mandatory Conversion. Upon the issuance of a notice to the Holders that a Sales Transaction has occurred (the date
of such election or issuance of a notice is referred to herein as the “Mandatory Conversion Time”), then all
outstanding shares of Preferred Stock shall immediately and automatically be converted into shares of Common Stock, at the then
effective Conversion Price as calculated pursuant to Section 6. All holders of record of shares of Preferred Stock shall be sent
written notice of the Mandatory Conversion Time along with instructions for converting the outstanding Preferred Stock certificates.
If such election shall have been duly made or notice of mandatory conversion shall have been duly given, then, notwithstanding
that the certificate evidencing any shares of Preferred Stock so converted remain outstanding and shall not have been surrendered,
all rights pertaining to such shares shall terminate, except only the right of the Holders to receive Common Stock certificates
upon surrender of their Preferred Stock certificates; provided, that the rights pertaining to such shares that remain unconverted
pursuant to the beneficial ownership limitations set forth in Section 6(d) shall not be affected. Such notice need not be sent
in advance of the occurrence of the Mandatory Conversion Time. For purposes of clarification, a conversion effected pursuant to
the terms of this Section 8 shall be subject to all of the provisions of Section 6, including, without limitation, the provisions
requiring payment of liquidated damages and beneficial ownership limitations.


 


Section
9. Redemption.


 


(a)
Optional Company Redemption. Subject to the terms hereof, at any time up to the fifth anniversary of the Original Issue
Date, the Corporation shall be entitled to redeem any or all of the outstanding shares of Preferred Stock (the “Optional
Company Redemption”) at a per share price equal to $50.00 (such amount, the “Redemption Price”), payable
in cash; provided that the Corporation shall have funds legally available for such payment.


 


(b)
Notice of Optional Company Redemption. Notice of any Optional Company Redemption of shares of Preferred Stock, specifying
the time and place of redemption and the Redemption Price (a “Redemption Notice”), shall be sent by courier
or first class overnight mail, pre-paid, to each holder of Preferred Stock to be redeemed, at the address for such holder shown
on the Company’s records, not more than ninety (90) nor less than thirty (30) days prior to the Redemption Date. If, in
any case, less than all of the shares of Preferred Stock then owned by such holder are to be redeemed, the Redemption Notice shall
also specify the number of shares which are to be redeemed; provided, however, that no failure to give such Redemption Notice
nor any defect therein shall affect the validity of the procedure for the redemption of any shares of Preferred Stock to be redeemed
except as to the holder to whom the Corporation has failed to give said Redemption Notice or except as to the holder whose Redemption
Notice was defective. Each such Redemption Notice shall state:


 






    	Exhibit 4.01 - Page 9



    	 



    

 


(i)
the Redemption Date, which may be no earlier than thirty (30) but not more than ninety (90) days after the Redemption Notice is
sent as set forth in Section 7(B) hereof;


 


(ii)
the Redemption Price;


 


(iii)
the number of shares of Preferred Stock to be redeemed and, if fewer than all the shares of Preferred Stock held by a holder are
to be redeemed, the number of shares thereof to be redeemed from such holder;


 


(iv)
the manner and place or places at which payment for the shares of Series A Preferred Stock to be redeemed will be made, upon presentation
and surrender to the Corporation of the certificates evidencing the shares being redeemed; and


 


(v)
that the rights of holders to convert shares of Series A Preferred Stock being redeemed shall terminate at the close of business
on the Redemption Date unless the Corporation defaults in the payment of the Redemption Price.


 


Upon
mailing any such Redemption Notice, the Corporation shall become obligated to redeem at the Redemption Price on the Redemption
Date all shares of Preferred Stock therein specified; provided, however, any redemption contemplated by any Redemption Notice
may be conditioned upon the occurrence of one or more transactions or other events and the Redemption Date in such Redemption
Notice may be the date on which such transaction is consummated or such other event occurs.


 


Section
10. Miscellaneous.


 


(a)
Notices. Any and all notices or other communications or deliveries to be provided by the Holders hereunder including, without
limitation, any Notice of Conversion, shall be in writing and delivered personally, by facsimile, or sent by a nationally recognized
overnight courier service, addressed to the Corporation at 248 Route 25A, No. 2, East Setauket, New York 11733 Attention: Chief
Executive Officer, facsimile number (___) ___-____, or such other facsimile number or address as the Corporation may specify for
such purposes by notice to the Holders delivered in accordance with this Section 10. Any and all notices or other communications
or deliveries to be provided by the Corporation hereunder shall be in writing and delivered personally, by facsimile, or sent
by a nationally recognized overnight courier service addressed to each Holder at the facsimile number or address of such Holder
appearing on the books of the Corporation, or if no such facsimile number or address appears on the books of the Corporation,
at the principal place of business of such Holder, as set forth in the Purchase Agreement. Any notice or other communication or
deliveries hereunder shall be deemed given and effective on the earliest of (i) the date of transmission, if such notice or communication
is delivered via facsimile at the facsimile number set forth in this Section prior to 5:30 p.m. (New York City time) on any date,
(ii) the next Trading Day after the date of transmission, if such notice or communication is delivered via facsimile at the facsimile
number set forth in this Section on a day that is not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading
Day, (iii) the second Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight courier service,
or (iv) upon actual receipt by the party to whom such notice is required to be given.


 


(b)
Absolute Obligation. Except as expressly provided herein, no provision of this Certificate of Designations shall alter
or impair the obligation of the Corporation, which is absolute and unconditional, to pay dividends, as applicable, on the shares
of Preferred Stock at the time, place, and rate, and in the coin or currency, herein prescribed.


 






    	Exhibit 4.01 - Page 10



    	 



    

 


(c)
Lost or Mutilated Preferred Stock Certificate. If a Holder’s Preferred Stock certificate shall be mutilated, lost,
stolen or destroyed, the Corporation shall execute and deliver, in exchange and substitution for and upon cancellation of a mutilated
certificate, or in lieu of or in substitution for a lost, stolen or destroyed certificate, a new certificate for the shares of
Preferred Stock so mutilated, lost, stolen or destroyed, but only upon receipt of evidence of such loss, theft or destruction
of such certificate, and of the ownership hereof reasonably satisfactory to the Corporation.


 


(d)
Governing Law. All questions concerning the construction, validity, enforcement and interpretation of this Certificate
of Designations shall be governed by and construed and enforced in accordance with the internal laws of the State of Delaware,
without regard to the principles of conflict of laws thereof. If any party shall commence an action or proceeding to enforce any
provisions of this Certificate of Designation, then the prevailing party in such action or proceeding shall be reimbursed by the
other party for its attorneys’ fees and other costs and expenses incurred in the investigation, preparation and prosecution
of such action or proceeding.


 


(e)
Waiver. Any waiver by the Corporation or a Holder of a breach of any provision of this Certificate of Designation shall
not operate as or be construed to be a waiver of any other breach of such provision or of any breach of any other provision of
this Certificate of Designation or a waiver by any other Holders. The failure of the Corporation or a Holder to insist upon strict
adherence to any term of this Certificate of Designation on one or more occasions shall not be considered a waiver or deprive
that party (or any other Holder) of the right thereafter to insist upon strict adherence to that term or any other term of this
Certificate of Designation on any other occasion. Any waiver by the Corporation or a Holder must be in writing.


 


(f)
Severability. If any provision of this Certificate of Designations is invalid, illegal or unenforceable, the balance of
this Certificate of Designations shall remain in effect, and if any provision is inapplicable to any Person or circumstance, it
shall nevertheless remain applicable to all other Persons and circumstances. If it shall be found that any interest or other amount
deemed interest due hereunder violates the applicable law governing usury, the applicable rate of interest due hereunder shall
automatically be lowered to equal the maximum rate of interest permitted under applicable law.


 


(g)
Next Business Day. Whenever any payment or other obligation hereunder shall be due on a day other than a Business Day,
such payment shall be made on the next succeeding Business Day.


 


(h)
Headings. The headings contained herein are for convenience only, do not constitute a part of this Certificate of Designation
and shall not be deemed to limit or affect any of the provisions hereof.


 


(i)
Status of Converted Preferred Stock. Shares of Preferred Stock may only be issued pursuant to the Purchase Agreement. If
any shares of Preferred Stock shall be converted or reacquired by the Corporation, such shares shall resume the status of authorized
but unissued shares of preferred stock and shall no longer be designated as Series A Convertible Preferred Stock.


 


The
undersigned declares under penalty of perjury that the matters set out in the foregoing Certificate are true of his own knowledge.
Executed at East Setauket, New York, on this 6th day of March 2015.


 


	 	 

        By:
	 
	 	Name:
    	 John
    Kovach
	 	Title:
    	 Chief
    Executive Officer and     President



 



    	Exhibit 4.01 - Page 11



    	 



    


 


ANNEX
A


 


NOTICE
OF CONVERSION


 


(TO
BE EXECUTED BY THE REGISTERED HOLDER IN ORDER TO CONVERT SHARES OF PREFERRED STOCK)


 


The undersigned
hereby elects to convert the number of shares of Series A Preferred Stock indicated below into shares (the “Conversion
Shares”) of common stock, par value $0.0001 per share (the “Common Stock”), of Lixte Biotechnology
Holdings, Inc., a Delaware corporation (the “Corporation”), according to the conditions hereof, as of the date
written below. If Conversion Shares are to be issued in the name of a Person other than the undersigned, the undersigned will
pay all transfer taxes payable with respect thereto and is delivering herewith such certificates and opinions as may be required
by the Corporation in accordance with the Purchase Agreement. No fee will be charged to the Holders for any conversion, except
for any such transfer taxes. In order to induce the Corporation to issue the stock certificate representing the Conversion Shares
without a restrictive legend, the undersigned hereby agrees to comply with the covenants set forth in Section 5.3 of the Purchase
Agreement. If the Conversion Shares are not covered by an effective resale registration statement at the time that the undersigned
intends to resell the Conversion Shares, the undersigned will not resell the Conversion Shares unless Rule 144, or another exemption,
is applicable, and then only in full compliance with Rule 144, or such other exemption, after receiving an opinion of counsel
that the Conversion Shares can be sold under Rule 144, or such other exemption.


 





	Conversion calculations:	 



 


	Date to Effect Conversion: 	 



 


	Number of shares of Preferred Stock owned prior to Conversion: 	 



 


	Number of shares of Preferred Stock to be Converted: 	 



 


	Aggregate Stated Value of Preferred Stock to be Converted: 	 



 


	Number of shares of Common Stock to be Issued: 	 



 


	Applicable Conversion Price: 	 



 


	Shares of Preferred Stock owned subsequent to Conversion: 	 



 


	Address for Delivery:  	 	or DWAC Instructions:



 


	Broker no:  	 	 Account no: 	 







 


	 	[HOLDER]
	 	 
	 	By:
         	 
	 	Name:     	 
	 	Title: