Exhibit 10.1


 


 





SECURITIES
PURCHASE AGREEMENT


 


This
Securities Purchase Agreement (this “Agreement”) is dated as of January 26, 2018, between Auris Medical Holding
AG, a company established in Switzerland (the “Company”), and each purchaser identified on the signature pages
hereto (each, including its successors and assigns, a “Purchaser” and collectively the “Purchasers”).


 


WHEREAS,
subject to the terms and conditions set forth in this Agreement and pursuant to (i) an effective registration statement under
the Securities Act of 1933, as amended (the “Securities Act”) as to the Shares and (ii) an exemption from the
registration requirements of Section 5 of the Securities Act contained in Section 4(a)(2) thereof and/or Regulation D thereunder
as to the Warrants, the Company desires to issue to each Purchaser, and each Purchaser, severally and not jointly, desires to
subscribe from the Company, securities of the Company as more fully described in this Agreement.


 


NOW,
THEREFORE, IN CONSIDERATION of the mutual covenants contained in this Agreement, and for other good and valuable consideration
the receipt and adequacy of which are hereby acknowledged, the Company and each Purchaser agree as follows:


 


ARTICLE
I.

DEFINITIONS


 


1.1            Definitions. In addition to the terms defined elsewhere in this Agreement, for all purposes of this Agreement, the
following terms have the meanings set forth in this Section 1.1:


 


“Acquiring
Person” shall have the meaning ascribed to such term in Section 4.5.


 


“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 under the Securities Act.


 


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


 


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


 


“Capital
Increase” shall mean the increase in the Company’s capital, nominal value CHF 0.40 per share, as evidenced by
a journal entry of the Commercial Register in the Canton of Zug, Switzerland.


 






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“Closing”
means the closing of the purchase and sale of the Securities pursuant to Section 2.1.


 


“Closing
Date” means January 30, 2018, or, with respect to a Purchaser from whom the Company has not received (i) such Purchaser’s
Subscription Amount or (ii) such Purchaser’s original executed Subscription Forms by 10:00 a.m. CET on January 29, 2018,
such later date as the Company may select; provided that such later date shall in no event be later than the Closing Deadline
for such Purchaser as set forth in Section 2.14.


 


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


 


“Common
Shares” means the common shares of the Company, currently having a nominal value CHF 0.40 per share, and any other class
of securities into which such securities may hereafter be reclassified, changed or adjusted.


 


“Common
Share Equivalents” means any securities of the Company or the Subsidiaries which would entitle the holder thereof to
acquire at any time Common Shares, including, without limitation, any debt, preferred stock, right, option, warrant or other instrument
that is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive,
Common Shares.


 


“Company
Intellectual Property” shall have the meaning ascribed to such term in Section 3.1(t).


 


“Company
Swiss Counsel” means Walder Wyss Ltd., with offices located at Seefeldstrasse 123, 8008 Zurich, Switzerland.


 


“Company
U.S. Counsel” means Davis Polk & Wardwell LLP, with offices located at 450 Lexington Avenue, New York, New York
10017.


 


“EGS”
means Ellenoff Grossman & Schole LLP, with offices located at 1345 Avenue of the Americas, New York, New York 10105-0302.


 


“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) Common Shares or options to employees, officers or directors of the Company pursuant
to any option plan duly adopted for such purpose, by a majority of the non-employee members of the Board of Directors or a majority
of the members of a committee of non-employee directors established for such purpose for services rendered to the Company, (b)
securities upon the exercise or exchange of or conversion of any Securities issued hereunder and/or other securities exercisable
or exchangeable for or convertible into Common Shares issued and outstanding on the date of this Agreement, provided that such
securities have not been amended since the date of this


 






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Agreement
to increase the number of such securities or to decrease the exercise price, exchange price or conversion price of such securities
(other than in connection with share splits or combinations) or to extend the term of such securities, (c) securities issued pursuant
to acquisitions or strategic transactions approved by a majority of the disinterested directors of the Company, provided such
securities are issued as “restricted securities” (as defined in Rule 144) and carry no registration rights that require
or permit the filing of any registration statement in connection therewith during the prohibition period in Section 4.12(a) herein,
and provided that any such issuance shall only be to a Person (or to the equityholders 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 Company and
shall provide to the Company additional benefits in addition to the investment of funds, but shall not include a transaction in
which the Company is issuing securities primarily for the purpose of raising capital or to an entity whose primary business is
investing in securities and (d) common shares of a wholly-owned subsidiary of the Company issued as merger consideration in connection
with the merger of the Company into such wholly-owned subsidiary of the Company.


 


“FCPA”
means the Foreign Corrupt Practices Act of 1977, as amended.


 


“FINRA”
means the Financial Industry Regulatory Authority, Inc.


 


“Health
Care Laws” shall have the meaning ascribed to such term in Section 3.1(pp).


 


“IFRS”
shall have the meaning ascribed to such term in Section 3.1(j).


 


“Legend
Removal Date” shall have the meaning ascribed to such term in Section 4.1(c).


 


“Liens”
means a lien, charge, pledge, security interest, encumbrance, right of first refusal, preemptive right or other restriction.


 


“Material
Adverse Effect” shall have the meaning assigned to such term in Section 3.1(q).


 


“Permits”
shall have the meaning ascribed to such term in Section 3.1(u).


 


“Per
Share Purchase Price” equals $0.44 or CHF 0.411708 (based on an exchange rate of $1.00 to CHF 0.9357), subject to adjustment
for reverse and forward stock splits, stock dividends, stock combinations and other similar transactions of the Common Shares
that occur after the date of this Agreement.


 


“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.


 






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“Placement
Agent” means Ladenburg Thalmann & Co. Inc.


 


“Proceeding”
means an action, claim, suit, investigation or proceeding (including, without limitation, an informal investigation or partial
proceeding, such as a deposition), whether commenced or threatened.


 


“Prospectus”
means the base prospectus filed for the Registration Statement.


 


“Prospectus
Supplement” means the supplement to the Prospectus complying with Rule 424(b) of the Securities Act that is filed with
the Commission and delivered by the Company to each Purchaser at the Closing.


 


“Purchaser
Party” shall have the meaning ascribed to such term in Section 4.8.


 


“Registration
Statement” means the effective registration statement with Commission file No. 333-206710 which registers the sale of
the Shares to the Purchasers.


 


“Required
Approvals” shall have the meaning ascribed to such term in Section 3.1(q).


 


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


 


“Rule
424” means Rule 424 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted
from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose
and effect as such Rule.


 


“SEC
Reports” shall mean the Prospectus and the Prospectus Supplement, and all reports, schedules, forms, statements and
other documents required to be filed by the Company under the Securities Act and the Exchange Act, including pursuant to Section
13(a) or 15(d) thereof, for the two years preceding the date hereof (or such shorter period as the Company was required by law
or regulation to file such material).


 


“Securities”
means the Shares, the Warrants and the Warrant Shares.


 


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


 


“Shares”
means the Common Shares issued or issuable to each Purchaser pursuant to this Agreement other than the Warrant Shares.


 






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“Short
Sales” means all “short sales” as defined in Rule 200 of Regulation SHO under the Exchange Act (but shall
not be deemed to include locating and/or borrowing shares of Common Shares). 


 


“Subscription
Amount” means, as to each Purchaser, the aggregate amount to be paid for Shares and Warrants purchased hereunder as
specified below such Purchaser’s name on the signature page of this Agreement and next to the heading “Subscription
Amount,” in Swiss Francs and in immediately available funds.


 


“Subscription
Form” means the subscription form in the form of Annex C.


 


“Subsidiary”
shall have the meaning ascribed to such term in Section 3.1(n).


 


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


 


“Trading
Market” means any of the following markets or exchanges on which the Common Shares are listed or quoted for trading
on the date in question: the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market,
the New York Stock Exchange or any successors to any of the foregoing).


 


“Transaction
Documents” means this Agreement and the Warrants.


 


“Transfer
Agent” means American Stock Transfer & Trust Company, LLC, the current transfer agent of the Company, with a mailing
address of 6201 15th Avenue, Brooklyn, NY 11219 and a facsimile number of (718) 765-8711, and any successor transfer
agent of the Company.


 


“Variable
Rate Transaction” shall have the meaning ascribed to such term in Section 4.12(b).


 


“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Shares are then
listed or quoted on a Trading Market, the daily volume weighted average price of the Common Shares for such date (or the nearest
preceding date) on the Trading Market on which the Common Shares are 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 OTCQB or OTCQX is not a Trading
Market, the volume weighted average price of the Common Shares for such date (or the nearest preceding date) on OTCQB or OTCQX
as applicable, (c) if the Common Shares are not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Common
Shares are then reported in the “Pink Sheets” published by OTC Markets Group, Inc. (or a similar organization or agency
succeeding to its functions of reporting prices), the most recent bid price per Common Share so reported, or (d) in all other
cases, the fair market value of a Common Share as


 






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determined
by an independent appraiser selected in good faith by the Purchasers of a majority in interest of the Securities then outstanding
and reasonably acceptable to the Company, the fees and expenses of which shall be paid by the Company.


 


“Warrants”
means, collectively, the Common Share purchase warrants delivered to the Purchasers at the Closing in accordance with Section
2.2(a) hereof, which Warrants shall be exercisable immediately and have a term of exercise equal to seven (7) years, in the form
of Exhibit A attached hereto.


 


“Warrant
Shares” means the Common Shares issuable upon exercise of the Warrants.


 


ARTICLE
II.

PURCHASE AND SALE


 


2.1 
Closing.


 


(a)           Upon the terms and subject to the conditions set forth herein, the Company agrees to sell, and the Purchasers, severally
and not jointly, agree to purchase, up to an aggregate of $5,499,999.56 (in its Swiss Franc equivalent, based on an exchange rate
of 0.9357 CHF to $1.00) of Shares and Warrants. No later than January 26, 2018, each Purchaser shall (i) pay such Purchaser’s
Subscription Amount in cash by wire transfer to the bank account in Switzerland set forth in Schedule I hereto specified by the
Company such that the Purchaser’s Subscription Amount has been credited to such bank account by no later than 10 a.m. CET
on January 29, 2018; and (ii) send by overnight courier to the address set forth in Schedule II hereto, the duly executed original
of such Purchaser’s Subscription Form, such that such Subscription Form are available to the Company by no later than 10
a.m. CET on January 29, 2018. Each Purchaser’s Subscription Amount deposited for the account of the Company shall not be
used by the Company in any way whatsoever until such time as the Company delivers such Purchaser’s respective Shares pursuant
to Section 2.1(b).


 


(b)           With respect to each Purchaser, on the relevant Closing Date, provided that the Company has received (i) such Purchaser’s
Subscription Amount and (ii) such Purchaser’s original executed Subscription Form, the Company shall deliver to such Purchaser
its respective Shares and a Warrant as determined pursuant to Section 2.2(a), and the Company and such Purchaser shall deliver
the other items set forth in Section 2.2 deliverable at the Closing. Upon satisfaction of the covenants and conditions set forth
in Sections 2.2 and 2.3, the Closing shall occur at the offices of EGS or such other location as the parties shall mutually agree
and upon receipt of such Shares, the Placement Agent shall promptly electronically deliver such Shares to the applicable Purchaser
and the Company shall deliver to each Purchaser a Warrant as determined pursuant to Section 2.2(a), and the Company and each Purchaser
shall deliver the other items set forth in Section 2.2 deliverable at the Closing.


 






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2.2           Deliveries.


 


(a)           On or prior to the Closing Date, the Company shall deliver or cause to be delivered to each Purchaser the following:


 


(i)               this Agreement duly executed by the Company;


 


(ii)             
a legal opinion of each of Company Swiss Counsel and Company U.S. Counsel, in the form reasonably acceptable to the Placement
Agent and the Purchasers;


 


(iii)           
a copy of the irrevocable instructions to the Transfer Agent instructing the Transfer Agent to deliver on an expedited
basis via The Depository Trust Company Deposit or Withdrawal at Custodian system (“DWAC”) Shares equal to such
Purchaser’s Subscription Amount divided by the Per Share Purchase Price, registered in the name of such Purchaser; and


 


(iv)            a Warrant registered in the name of such Purchaser to purchase up to a number of Common Shares equal to 60% of the number
of Shares purchased by such Purchaser hereunder with an exercise price equal to $0.50, subject to adjustment therein; and


 


(v)            
the Prospectus and Prospectus Supplement (which may be delivered in accordance with Rule 172 under the Securities Act).


 


(b)              
Each Purchaser shall deliver or cause to be delivered to the Company the following:


 


(i)              On or prior to the Closing Date, this Agreement duly executed by such Purchaser;


 


(ii)             On the date set forth in Section 2.1(a), the original Subscription Form duly executed by such Purchaser to the address
set forth in Schedule II hereto; and


 


(iii)           
On the date set forth in Section 2.1(a), such Purchaser’s Subscription Amount by wire transfer to the account set
forth in Schedule I hereto.


 


2.3           Closing Conditions.


 


(a)           The
obligations of the Company hereunder in connection with the Closing are subject to the following conditions being met:


 


(i)               the accuracy in all material respects (or, to the extent representations or warranties are qualified by materiality or
Material Adverse Effect, in all respects) on the Closing Date of the representations and warranties of the Purchasers contained
herein (unless such representations and warranties are given as of such date therein in which case they shall be accurate as of
such date);


 


(ii)             all obligations, covenants and agreements of each Purchaser required to be performed at or prior to the Closing Date shall
have been performed; and


 


(iii)           
the delivery by each Purchaser of the items set forth in Section 2.2(b) of this Agreement.


 


(b)           The respective obligations of the Purchasers hereunder in connection with the Closing are subject to the following conditions
being met:


 


(i)               the accuracy in all material respects (or, to the extent representations or warranties are qualified by materiality or
Material Adverse Effect, in all respects) when made and on the Closing Date of the representations


 






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and
warranties of the Company contained herein (unless as of a specific date therein in which case they shall be accurate as of such
date);


 


(ii)            
all obligations, covenants and agreements of the Company required to be performed at or prior to the Closing Date shall
have been performed;


 


(iii)           
the delivery by the Company of the items set forth in Section 2.2(a) of this Agreement;


 


(iv)           
there shall have been no Material Adverse Effect with respect to the Company since the date hereof; and


 


(v)            
from the date hereof to the Closing Date, trading in the Common Shares shall not have been suspended by the Commission
or the Company’s principal Trading Market, and, at any time prior to the Closing Date, trading in securities generally as
reported by Bloomberg L.P. shall not have been suspended or limited, or minimum prices shall not have been established on securities
whose trades are reported by such service, or on any Trading Market, nor shall a banking moratorium have been declared either
by the United States or New York State authorities nor shall there have occurred any material outbreak or escalation of hostilities
or other national or international calamity of such magnitude in its effect on, or any material adverse change in, any financial
market which, in each case, in the reasonable judgment of such Purchaser, makes it impracticable or inadvisable to purchase the
Securities at the Closing.


 


For
the avoidance of doubt, each Purchaser’s obligation to deliver such Purchaser’s Subscription Amount and executed original
Subscription Form shall not be subject to the conditions set forth in this Section 2.3(b).


 






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2.4 
Failure to Close. In the event that by the tenth calendar day following the day the Company receives (i) a Purchaser’s
Subscription Amount and (ii) such Purchaser’s original executed Subscription Form (such date with respect to such Purchaser,
the “Closing Deadline”), the Company fails to deliver to such Purchaser the number of Shares and Warrants required
to be delivered to such Purchaser pursuant to Section 2.2(a), the Company shall refund to such Purchaser such Purchaser’s
Subscription amount in cash by wire transfer to the bank account specified by such Purchaser and shall do all other acts required
for such wire transfer.


 


ARTICLE
III.

REPRESENTATIONS AND WARRANTIES


 


3.1           Representations and Warranties of the Company. The Company hereby makes the following representations and warranties
to each Purchaser:


 


(a)           Compliance with Registration Requirements. The Registration Statement has become effective under the Securities
Act. 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 is in effect and, to the knowledge
of the Company, no proceedings for such purpose have been instituted or are pending or are contemplated or threatened by the Commission.
At the time the Company’s Annual Report on Form 20-F for the year ended December 31, 2016 (the “Annual Report”)
was filed with the Commission, or, if later, at the time the Registration Statement was originally filed with the Commission,
the Company met the then-applicable requirements for use of Form F-3 under the Securities Act. The documents incorporated or deemed
to be incorporated by reference in the Registration Statement and the Prospectus Supplement, at the time they were or hereafter
are filed with the Commission, or became effective under the Exchange Act, as the case may be, complied and will comply in all
material respects with the requirements of the Exchange Act.


 


(b)           Disclosure. The Prospectus and the Prospectus Supplement when filed complied in all material respects with
the Securities Act and, if filed by electronic transmission pursuant to EDGAR, was identical (except as may be permitted by Regulation S-T
under the Securities Act) to the copy thereof delivered to the Purchasers for use in connection with the offer and sale of the
Shares. Each of the Registration Statement and any post-effective amendment thereto, at the time it became or becomes effective,
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 hereof, the Prospectus did not, and at the Closing Date (as defined in Section 1.1) will 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 Supplement as of its date, did not, and at the
Closing Date 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.


 






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The
representations and warranties set forth in the three immediately preceding sentences do not apply to statements in or omissions
from the Registration Statement or any post-effective amendment thereto, or the Prospectus Supplement, or any amendments or supplements
thereto, made in reliance upon and in conformity with written information relating to the Placement Agent furnished to the Company
in writing by the Placement Agent expressly for use therein. There are no contracts or other documents required to be described
in the Prospectus Supplement or to be filed as an exhibit to the Registration Statement which have not been described or filed
as required.


 


(c)            Free Writing Prospectuses; Road Show. As of the determination date referenced in Rule 164(h) under the Securities
Act, the Company was not, is not or will not be (as applicable) an “ineligible issuer” in connection with the offering
of the Securities pursuant to Rules 164, 405 and 433 under the Securities Act. Each 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 offer and sale of the Shares did not, does not and will not include
any information that conflicted, conflicts or will conflict with the information contained in the Registration Statement, the
Prospectus or any Prospectus Supplement and not superseded or modified.


 


(d)           The Securities Purchase Agreement. This Agreement has been duly authorized, executed and delivered by the Company.


 


(e)            Authorization of the Securities. The Securities have been duly authorized for issuance and sale pursuant
to this Agreement or the Warrants and, when issued and delivered by the Company against payment therefor pursuant to this Agreement
or the Warrants, will be validly issued, fully paid and nonassessable, and the issuance and sale of the Securities is not subject
to any preemptive rights, rights of first refusal or other similar rights to subscribe for or purchase the Securities which have
not been duly withdrawn waived or satisfied. Upon the sale and delivery to the Purchasers of the Securities, and payment therefor,
the Purchasers will acquire good, marketable and valid title to such Securities, free and clear of all pledges, liens, security
interests, charges, claims or encumbrances.


 


(f)            No Applicable Registration or Other Similar Rights. Except for the Purchasers and except as described in
the Registration Statement and the Prospectus Supplement, 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 withdrawn or waived.


 






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(g)           No Material Adverse Change. Except as otherwise disclosed in the Registration Statement and the Prospectus Supplement,
subsequent to the respective dates as of which information is given in the Registration Statement and the Prospectus Supplement:
(i) there has been no material adverse change, or any development that could be expected to result in a material adverse
change, in the condition, financial or otherwise, or in the earnings, business, properties, operations, assets, liabilities or
prospects, whether or not arising from transactions in the ordinary course of business, of the Company and its Subsidiaries, considered
as one entity (any such change being referred to herein as a “Material Adverse Change”); (ii) the Company
and its Subsidiaries, considered as one entity, have not incurred any material liability or obligation, indirect, direct or contingent,
including without limitation any losses or interference with its 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 its Subsidiaries, considered as one entity,
or have entered into any transactions not in the ordinary course of business; and (iii) there has not been any material decrease
in the capital stock or any material increase in any short-term or long-term indebtedness of the Company or its Subsidiaries 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 or other Subsidiaries, by any of the Company’s Subsidiaries on any class of capital stock, or any repurchase
or redemption by the Company or any of its Subsidiaries of any class of capital stock.


 


(h)           No Overindebtedness. Except for Auris Medical AG, whose overindebtedness is covered by subordination
of claims of the Company, neither the Company nor its Swiss Subsidiaries are overindebted or suffering from capital loss within
the meaning of article 725 CO.


 


(i)             Independent Accountants. Deloitte AG, 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 Supplement, 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, (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 and (iv) an independent qualified public accountant qualified under the
applicable provisions of the Swiss Code of Obligations (the “CO”), the Swiss Audit Supervision Act (Revisionsaufsichtsgesetz)
and any ordinances promulgated thereunder.


 


(j)             Financial Statements. The financial statements filed with the Commission as a part of the Registration Statement
and the Prospectus Supplement present fairly, in all material respects, the consolidated financial position of the Company and
its Subsidiaries as of the dates indicated and the results of their operations, changes in stockholders’ equity and cash
flows for the periods specified. Such financial statements


 






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have
been prepared in conformity with International Financial Reporting Standards (“IFRS”) as issued by the International
Accounting Standards Board (the “IASB”) applied on a consistent basis throughout the periods involved, except
as may be expressly stated in the related notes thereto or as otherwise disclosed therein, and, in the case of interim financial
statements, subject to normal year-end audit adjustments and the exclusion of certain footnotes. No other financial statements
or supporting schedules are required to be included in the Registration Statement or the Prospectus Supplement. The financial
data set forth in each of the Registration Statement and the Prospectus Supplement under the captions “Selected Financial
Data” and “Capitalization” present fairly, in all material respects, the information set forth therein on a
basis consistent with that of the audited financial statements contained in the Registration Statement and the Prospectus Supplement.
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, supporting schedules or other financial data filed with the Commission
as a part of the Registration Statement and the Prospectus Supplement.


 


(k)            Company’s Accounting System. The Company and each of its Subsidiaries make and keep accurate books and records
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 IFRS as issued by IASB and to maintain accountability for assets;
(iii) access to assets is permitted only in accordance with management’s general or specific authorization, and (iv) the
recorded accountability for assets is compared with existing assets at reasonable intervals and appropriate action is taken with
respect to any differences.


 


(l)             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 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
and 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 has been no material weakness 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 that has materially and adversely
affected, or is reasonably likely to materially and adversely affect, the Company’s internal control over financial reporting.


 


(m)           Incorporation of the Company. The Company has been duly incorporated and is validly existing under the laws of Switzerland
and has the corporate power and


 






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authority
to own, lease and operate its properties and to conduct its business as described in the Registration Statement and the Prospectus
Supplement and to enter into and perform its obligations under this Agreement. The Company is duly qualified as a foreign corporation
to transact business in each jurisdiction in which such qualification is required, whether by reason of the ownership or leasing
of property or the conduct of business.


 


(n)           Subsidiaries. Each of the Company’s subsidiaries (for purposes of this Agreement, as defined in Rule 405 under
the Securities Act) (each, a “Subsidiary”), has been duly incorporated or organized, as the case may be, and
is validly existing as a corporation, partnership or limited liability company, as applicable, in good standing (where such concept
exists) under the laws of the jurisdiction of its incorporation or organization 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 Supplement. Each of the Company’s Subsidiaries is duly qualified as a foreign corporation, partnership or limited
liability company, as applicable, to transact business and is in good standing in each 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 (where such concept exists) would not, individually or in the aggregate, result in a Material
Adverse Effect. All of the issued and outstanding capital stock or other equity or ownership interests of each of the Company’s
Subsidiaries have been duly authorized and validly issued, are fully paid and nonassessable and are owned by the Company, directly
or through Subsidiaries, free and clear of any security interest, mortgage, pledge, lien, encumbrance or adverse claim. The Company
does not own or control, directly or indirectly, any corporation, association or other entity other than the subsidiaries listed
in Exhibit 21 incorporated by reference in the Registration Statement.


 


(o)           Capitalization and Other Capital Stock Matters. The authorized, issued and outstanding share capital of the Company
is as set forth in the Prospectus Supplement under the caption “Capitalization” (other than for subsequent issuances,
if any, pursuant to employee benefit plans, or upon the exercise of outstanding options or conversion rights, in each case described
in the Prospectus Supplement). All of the issued and outstanding Shares have been duly authorized and validly issued, are fully
paid and nonassessable and have been issued in compliance with all applicable securities laws. Except as described in the Prospectus
Supplement, none of the outstanding 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. The Shares conform to the law of the jurisdiction of the
Company’s incorporation and to any requirements of the Company’s organizational documents. 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 capital stock of the Company or any of its Subsidiaries other than those
described in the Registration Statement and the Prospectus Supplement. The descriptions of the Company’s stock option, stock
bonus and other stock plans or arrangements, and the options or other rights granted thereunder, set forth in the Registration
Statement and the Prospectus Supplement


 






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accurately
and fairly presents the information required to be shown with respect to such plans, arrangements, options and rights.


 


(p)           Stock Exchange Listing. The Shares and Warrant Shares have been approved for listing on The NASDAQ Capital
Market (the “NASDAQ”).


 


(q)           Non-Contravention of Existing Instruments; No Further Authorizations or Approvals Required. Neither the Company
nor any of its Subsidiaries is in violation of its articles of association or operating agreement 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 any of its Subsidiaries 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 would not be expected, individually or in the aggregate, to have a material adverse effect on the
condition (financial or other), earnings, business, properties, operations, assets, liabilities or prospects of the Company and
its Subsidiaries, considered as one entity (a “Material Adverse Effect”). The Company’s execution, delivery
and performance of this Agreement, consummation of the transactions contemplated hereby and by the Registration Statement and
the Prospectus Supplement and the issuance and sale of the Securities (including the use of proceeds from the sale of the Shares
as described in the Registration Statement and the Prospectus Supplement 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
of association or operating agreement or similar organizational documents, as applicable, of the Company or any 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 any of its Subsidiaries
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 any of its Subsidiaries except,
as to clauses (ii) and (iii), as would not be expected, individually or in the aggregate, to have a Material Adverse Effect. 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 Supplement, 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, the Financial Industry Regulatory Authority (“FINRA”) and (i) the filings
required pursuant to Section 4.4 of this Agreement, (ii) the filing with the Commission of the Prospectus Supplement, (iii) application(s)
to each applicable Trading Market for the listing of the Shares and Warrant Shares for trading thereon in the time and manner
required thereby, and (iv) the filing of Form D with the Commission and such filings as are required to be made under applicable
state securities laws (collectively,


 






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the
“Required Approvals”). 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 any of its Subsidiaries.


 


(r)            Compliance with Laws. The Company and its Subsidiaries have been and are in compliance with all applicable laws,
rules and regulations, except where failure to be so in compliance would not be expected, individually or in the aggregate, to
have a Material Adverse Effect.


 


(s)           No Material Actions or Proceedings. There is no action, suit, proceeding, inquiry or investigation brought
by or before any governmental entity now pending or, to the knowledge of the Company, threatened, against or affecting the Company
or any of its Subsidiaries, which would be expected, individually or in the aggregate, to have a Material Adverse Effect or materially
and adversely affect the consummation of the transactions contemplated by this Agreement or the performance by the Company of
its obligations hereunder; and the aggregate of all pending legal or governmental proceedings to which the Company or any such
Subsidiary is a party or of which any of their respective properties or assets is the subject, including ordinary routine litigation
incidental to the business, if determined adversely to the Company, would not be expected to have a Material Adverse Effect. No
material labor dispute with the employees of the Company or any of its Subsidiaries exists or, to the knowledge of the Company,
is threatened or imminent.


 


(t)            Intellectual Property Rights.  Except as described in the Registration Statement and the Prospectus
Supplement, the Company, to the best of its knowledge, owns or has valid, binding and enforceable licenses or other enforceable
rights under the patents and patent applications, copyrights, trademarks, trademark registrations, service marks, service mark
registrations, trade names, service names and know-how (including trade secrets and other unpatented and/or unpatentable proprietary
or confidential information, systems or procedures) as described in the Registration Statement and the Prospectus Supplement and
used in the conduct, or the proposed conduct, of the business of the Company in the manner described in the Registration Statement
and the Prospectus Supplement (collectively, the “Company Intellectual Property”); except as described in the
Registration Statement and the Prospectus Supplement, to the knowledge of the Company, the patents, trademarks, and copyrights
included within the Company Intellectual Property are valid, enforceable, and subsisting, and there is no pending or, to the Company’s
knowledge, threatened action, suit, proceeding or claim by others challenging the validity, enforceability or scope of any Company
Intellectual Property; other than as disclosed in the Registration Statement and the Prospectus Supplement, (i) the Company has
not received any notice of any claim of infringement, misappropriation or conflict with any asserted rights of others with respect
to any of the Company’s products, proposed products or processes, (ii) to the knowledge of the Company, neither the sale
nor use of any of products, proposed products or processes of the Company referred to in the Registration Statement or the Prospectus
Supplement do or will, to the


 






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knowledge
of the Company, infringe, any valid patent claim of any third party or violate any valid right of any third party, and (iii) to
the knowledge of the Company, no third party has any ownership right in or to any Company Intellectual Property that is owned
by the Company, other than any co-owner of any patent or pending patent application constituting Company Intellectual Property
who is listed on the records of the U.S. Patent and Trademark Office (the “USPTO”) , and, to the knowledge
of the Company, no third party has any ownership right in or to any Company Intellectual Property in any field of use that is
exclusively licensed to the Company, other than any licensor to the Company of such Company Intellectual Property; except as described
in the Registration Statement and the Prospectus Supplement, none of the technology employed by the Company has been obtained
or is being used by the Company in violation of any contractual obligation binding on the Company except as would not be expected,
individually or in the aggregate, to have a Material Adverse Effect, or, to the Company’s knowledge, upon any of its officers,
directors or employees; except as described in the Registration Statement and the Prospectus Supplement, to the knowledge of the
Company all patents and patent applications owned by and licensed to the Company or under which the Company has rights have been
duly and properly filed and maintained; to the knowledge of the Company, the parties prosecuting such applications have complied
with their duty of candor and disclosure to the USPTO in connection with such applications; and the Company is not aware of any
facts required to be disclosed to the USPTO that were not disclosed to the USPTO and which would preclude the grant of a patent
in connection with any such application or could form the basis of a finding of invalidity with respect to any patents that have
issued with respect to such applications.


 


(u)           All Necessary Permits, etc. The Company and its Subsidiaries possess such valid and current certificates, authorizations,
exemptions, approvals, clearances or permits required by state, federal or foreign regulatory agencies or bodies to conduct their
respective businesses as currently conducted and as described in the Registration Statement or the Prospectus Supplement (“Permits”).
Neither the Company nor any of its Subsidiaries 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 where such revocation or modification would not, individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect.


 


(v)           Title to Properties. The Company and its Subsidiaries have good and marketable title to all of the real and
personal property and other assets reflected as owned in the financial statements referred to in Section 3.1(j) above (or elsewhere
in the Registration Statement, the Time or the Prospectus Supplement), in each case free and clear of any security interests,
mortgages, liens, encumbrances, equities, adverse claims and other defects, except as otherwise disclosed in the Registration
Statement and the Prospectus Supplement or as would not reasonably be expected to have a Material Adverse Effect. The real property,
improvements, equipment and personal property held under lease by the Company or any of its Subsidiaries 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 such Subsidiary.


 






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(w)          Tax Law Compliance. Except where the failure to do so would not constitute a Material Adverse Effect, (a)
all tax returns (including tax refund requests) required to be filed pursuant to applicable law by or with respect to the Company
and any of its Subsidiaries have been timely filed, or proper request of extension thereof has been filed, and (b) all tax returns
filed are complete and correct, and all taxes, fines or penalties due including any interest and penalties, except tax deficiencies
that the Company or any of its Subsidiaries are contesting in good faith subject to applicable reserves, have been timely paid
and fully reserved against in the applicable financial statements referred to in Section 3.1(j). Except as disclosed in the Registration
Statement and the Prospectus Supplement, no stamp or other issuance or transfer taxes or duties and no capital gains, income,
withholding, value added, capital or other taxes (but excluding any income tax, capital gains tax or similar resulting from the
sale of the Securities and any tax on or determined by reference to the income of the Purchasers that is subject to tax on a net
income basis) are payable by or on behalf of the Purchasers to any Swiss tax authorities or any political subdivisions or taxing
authority thereof or therein in connection with (i) the issuance of the Securities, (ii) the execution and delivery of this Agreement
or any other document to be furnished hereunder, and (iii) the sale, delivery and resale of the Securities in the manner contemplated
in this Agreement.


 


(x)            Insurance. Except as described in the Registration Statement and the Prospectus Supplement, each of the Company
and its Subsidiaries are insured with policies in such amounts and with such deductibles and covering such risks as the Company
believes are adequate and customary for their businesses including, but not limited to, policies covering real and personal property
owned or leased by the Company and its Subsidiaries against theft, damage, destruction, acts of vandalism and earthquakes and
policies covering the Company and its Subsidiaries for product liability claims and clinical trial liability claims. The Company
has no reason to believe that it or any of its Subsidiaries 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 would not be expected to have a Material Adverse Effect. Neither the
Company nor any of its Subsidiaries has been denied any insurance coverage which it has sought or for which it has applied.


 


(y)           Compliance with Environmental Laws. Except as described in the Registration Statement and the Prospectus Supplement
and except as would not be expected, individually or in the aggregate, to have a Material Adverse Effect: (i) neither the Company
nor any of its Subsidiaries is in violation of any federal, state, 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


 






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Materials
(collectively, “Environmental Laws”); (ii) the Company and its Subsidiaries 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 any of its Subsidiaries; 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 any of its Subsidiaries relating to Hazardous
Materials or any Environmental Laws.


 


(z)            ERISA Compliance. The “employee benefit plans” (as defined under the Employee Retirement Income
Security Act of 1974, as amended, and the regulations and published interpretations thereunder (collectively, “ERISA”))
sponsored or maintained by the Company or its Subsidiaries are operated in compliance in all material respects with ERISA to the
extent applicable, except where the failure to be in compliance would not be expected to have a Material Adverse Effect. 
“ERISA Affiliate” means, with respect to the Company or any of its Subsidiaries, any entity that is treated
as a single employer with the Company or any of its Subsidiaries under 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”).  Neither
the Company, its Subsidiaries 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 that would reasonably be expected to be a material liability of the Company.  Neither
the Company nor any of its Subsidiaries (i) sponsors or maintains any plan that is subject to Title IV of
ERISA or is intended to be qualified under Section 401(a) of the Code or (ii) reasonably expects to incur any material
liability under Title IV of ERISA.


 


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


 


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


 


(cc)          Related-Party Transactions. There are no business relationships or related-party transactions involving the
Company or any of its Subsidiaries or any other


 






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person
required to be described in the Registration Statement, the Prospectus or the Prospectus Supplement that have not been described
as required.


 


(dd)         FINRA Matters. All of the information provided to the Placement Agent or to counsel for the Placement Agent
by the Company, its counsel, its officers and directors and, to the Company’s knowledge, the holders of any securities (debt
or equity) or options to acquire any securities of the Company in connection with the offering of the Securities is true, complete,
correct and compliant with FINRA’s rules in all material respects 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.


 


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


 


(ff)           No Unlawful Contributions or Other Payments. Neither the Company nor any of its Subsidiaries nor, to the
Company’s knowledge, any employee or agent of the Company or any Subsidiary, has made any contribution or other payment
to any official of, or candidate for, any federal, state or foreign office in violation of any law or of the character required
to be disclosed in the Registration Statement or the Prospectus Supplement.


 


(gg)         Foreign Corrupt Practices Act. Neither the Company nor any of its Subsidiaries nor, to the knowledge of the Company,
any director, officer, agent, employee, affiliate or other person acting on behalf of the Company or any of its Subsidiaries has,
in the course of its actions for, or on behalf of, the Company or any of its Subsidiaries (i) used any corporate funds for any
unlawful contribution, gift, entertainment or other unlawful expenses relating to political activity; (ii) made any direct or
indirect unlawful payment to any domestic government official, “foreign official” (as defined in the U.S. Foreign
Corrupt Practices Act of 1977, as amended, and the rules and regulations thereunder (collectively, the “FCPA”)
or employee from corporate funds; (iii) violated or is in violation of any provision of the FCPA or any applicable non-U.S.
anti-bribery statute or regulation; or (iv) made any unlawful bribe, rebate, payoff, influence payment, kickback or other
unlawful payment to any domestic government official, such foreign official or employee; and the Company and its Subsidiaries
and, to the knowledge of the Company, the Company’s affiliates have conducted their respective businesses in compliance
with the FCPA and have instituted policies and procedures designed to ensure, and which are reasonably expected to continue to
ensure, continued compliance therewith.


 


(hh)         Money Laundering Laws. The operations of the Company and its Subsidiaries 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


 






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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
any of its Subsidiaries with respect to the Money Laundering Laws is pending or, to the best knowledge of the Company, threatened.


 


(ii)            OFAC. Neither the Company nor any of its Subsidiaries nor, to the knowledge of the Company, any director,
officer, agent, employee, affiliate or person acting on behalf of the Company or any of its Subsidiaries is currently subject
to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department (“OFAC”);
and the Company will not directly or indirectly use the proceeds of this offering, or lend, contribute or otherwise make available
such proceeds to any 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 impermissibly in any country or territory, that currently is the subject to any U.S. sanctions
administered by OFAC 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 U.S. sanctions administered by OFAC.


 


(jj)            Brokers. Other than the Placement Agent, 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.


 


(kk)          Submission to Jurisdiction. The Company has the power to submit, and pursuant to Section 5.9 of this
Agreement, has legally, validly, effectively and irrevocably submitted, to the personal jurisdiction of each United States federal
court and New York state court located in the Borough of Manhattan, in the City of New York, New York, U.S.A. (each, a “New
York Court”).


 


(ll)            No Rights of Immunity. Except as provided by laws or statutes generally applicable to transactions
of the type described in this Agreement, neither the Company nor any of its respective properties, assets or revenues has any
right of immunity under Swiss, New York or United States law, from any legal action, suit or proceeding, from the giving of any
relief in any such legal action, suit or proceeding, from set-off or counterclaim, from the jurisdiction of any Swiss, New York
or United States federal court, from service of process, attachment upon or prior judgment, or attachment in aid of execution
of judgment, or from execution of a judgment, or other legal process or proceeding for the giving of any relief or for the enforcement
of a judgment, in any such court, with respect to its obligations, liabilities or any other matter under or arising out of or
in connection with this Agreement or the Deposit Agreement. To the extent that the Company or any of its respective properties,
assets or revenues may have or may hereafter become entitled to any such right of immunity in any such court in which proceedings
may at any time be commenced, the Company waives or will waive such right to the extent permitted by law and has consented to
such relief and enforcement as provided in Section 5.9 of this Agreement.


 






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(mm)       Forward-Looking Statements. Each financial or operational projection or other “forward-looking
statement” (as defined by Section 27A of the Securities Act or Section 21E of the Exchange Act) contained in the Registration
Statement or the Prospectus Supplement (i) was so included by the Company in good faith and with reasonable basis after due
consideration by the Company of the underlying assumptions, estimates and other applicable facts and circumstances and (ii) is
accompanied by meaningful cautionary statements identifying those factors that could cause actual results to differ materially
from those in such forward-looking statement. No such statement was made with the knowledge of an executive officer or director
of the Company that is was false or misleading.


 


(nn)        
Foreign Private Issuer. The Company is a “foreign private issuer” within the meaning of Rule 405 under
the Securities Act.


 


(oo)        
Clinical Data and Regulatory Compliance. The preclinical tests and clinical trials conducted by the Company, and
to the knowledge of the Company, the preclinical tests and clinical trials conducted on behalf of or sponsored by the Company,
that are described in, or the results of which are referred to in, the Registration Statement, the Prospectus or the Prospectus
Supplement 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 and all applicable
laws and regulations, including, without limitation, 21 C.F.R. Parts 50, 54, 56, 58, and 312; 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 its Subsidiaries 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, the Prospectus or the Prospectus Supplement;
the Company and its Subsidiaries have made all such filings and obtained all such Permits 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”) for the operation of the Company’s business as currently conducted, except as
would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect; neither the Company nor
any of its Subsidiaries 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, the Prospectus or the
Prospectus Supplement; and the Company and its Subsidiaries have each operated and currently are in compliance in all material
respects with all applicable rules and regulations of the Regulatory Agencies except as would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.


 


(pp)         Compliance with Health Care Laws. Except as would not, individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect, each of the Company and its Subsidiaries is, and at all times has been, in compliance with
all applicable Health Care Laws, and has not engaged in activities which are, as applicable,


 






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cause
for false claims liability, civil penalties, or mandatory or permissive exclusion from Medicare, Medicaid, or any other state
health care program or federal health care program. For purposes of this Agreement, “Health Care Laws” means:
(i) the Federal Food, Drug, and Cosmetic Act and the regulations promulgated thereunder; (ii) all applicable federal, state, local
and all applicable foreign health care related fraud and abuse laws, including, without limitation, the U.S. Anti-Kickback Statute
(42 U.S.C. Section 1320a-7b(b)), the Anti-Inducement Law (42 U.S.C. § 1320a-7a(a)(5)), the U.S. Physician Payment Sunshine
Act (42 U.S.C. § 1320a-7h), the U.S. Civil False Claims Act (31 U.S.C. Section 3729 et seq.), the criminal False Claims
Law (42 U.S.C. § 1320a-7b(a)), all criminal laws relating to health care fraud and abuse, including but not limited to 18
U.S.C. Sections 286 and 287, and the health care fraud criminal provisions under the U.S. Health Insurance Portability and Accountability
Act of 1996 (“HIPAA”) (42 U.S.C. Section 1320d et seq.), the exclusion laws (42 U.S.C. § 1320a-7), the
civil monetary penalties law (42 U.S.C. § 1320a-7a), HIPAA, as amended by the Health Information Technology for Economic
and Clinical Health Act (42 U.S.C. Section 17921 et seq.), and the regulations promulgated pursuant to such statutes; (iii) Medicare
(Title XVIII of the Social Security Act); (iv) Medicaid (Title XIX of the Social Security Act); and (v) any and all other applicable
health care laws and regulations. Neither the Company nor, to the knowledge of the Company, its Subsidiary has received written
notice of any claim, action, suit, proceeding, hearing, enforcement, investigation, arbitration or other action from any court
or arbitrator or governmental or regulatory authority or third party alleging that any product operation or activity is in material
violation of any Health Care Laws, and, to the Company’s knowledge, no such claim, action, suit, proceeding, hearing, enforcement,
investigation, arbitration or other action is threatened. Neither the Company nor, to the knowledge of the Company, its Subsidiary
is a party to or has any ongoing reporting obligations pursuant to any corporate integrity agreements, deferred prosecution agreements,
monitoring agreements, consent decrees, settlement orders, plans of correction or similar agreements with or imposed by any governmental
or regulatory authority. Additionally, neither the Company, its Subsidiaries nor any of its respective employees, officers or
directors has been excluded, suspended or debarred from participation in any U.S. federal health care program or human clinical
research or, to the knowledge of the Company, is subject to a governmental inquiry, investigation, proceeding, or other similar
action that could reasonably be expected to result in debarment, suspension, or exclusion.


 


(qq)         No Contract Terminations. Neither the Company nor any of its Subsidiaries has sent or received any
communication regarding termination of, or intent not to renew, any of the contracts or agreements referred to or described in
the Prospectus or any free writing prospectus, or referred to or described in, or filed as an exhibit to, the Registration Statement,
or any document incorporated by reference therein, and no such termination or non-renewal has been threatened by the Company or
any of its Subsidiaries or, to the Company’s knowledge, any other party to any such contract or agreement, which threat
of termination or non-renewal has not been rescinded as of the date hereof, except where such termination or non-renewal would
not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.


 


(rr)           Dividend Restrictions. Except as described in the Registration Statement and the Prospectus Supplement, no
Subsidiary of the Company is prohibited or restricted, directly or indirectly, from paying dividends to the Company, or from making
any other distribution with respect to such Subsidiary’s equity securities or from repaying to the Company or any other
Subsidiary of the Company any amounts that may from time to time become due under any loans or advances to such Subsidiary from
the Company or from transferring any property or assets to the Company or to any other Subsidiary.


 


(ss)          No Integrated Offering. Assuming the accuracy of the Purchasers’ representations and warranties set forth
in Section 3.2, neither the Company, nor any of its Affiliates, nor any Person acting on its or their behalf has, directly or
indirectly, made any offers or sales of any security or solicited any offers to buy any security, under circumstances that would
cause this offering of the Securities to be integrated with prior offerings by the Company for purposes of (i) the Securities
Act which would require the registration of the Warrants or Warrant Shares under the Securities Act, or (ii) any applicable shareholder
approval provisions of any Trading Market on which any of the securities of the Company are listed or designated.


 


(tt)           Acknowledgment Regarding Purchasers’ Purchase of Securities. The Company acknowledges and agrees that each
of the Purchasers is acting solely in the capacity of an arm’s length purchaser with respect to the Transaction Documents
and the transactions contemplated thereby. The Company further acknowledges that no Purchaser is acting as a financial advisor
or fiduciary of the Company (or in any similar capacity) with respect to the Transaction Documents and the transactions contemplated
thereby and any advice given by any Purchaser or any of their respective representatives or agents in connection with the Transaction
Documents and the transactions contemplated thereby is merely incidental to the Purchasers’ purchase of the Securities.
The Company further represents to each Purchaser that the Company’s decision to enter into this Agreement and the other
Transaction Documents has been based solely on the independent evaluation of the transactions contemplated hereby by the Company
and its representatives.


 


(uu)         Acknowledgement
Regarding Purchaser’s Trading Activity. Anything in this Agreement or elsewhere herein to the contrary notwithstanding
(except for Sections 3.2(f) and 4.14 hereof), it is understood and acknowledged by the Company that: (i) none of the Purchasers
has been asked by the Company to agree, nor has any Purchaser agreed, to desist from purchasing or selling, long and/or short,
securities of the Company, or “derivative” securities based on securities issued by the Company or to hold the Securities
for any specified term; (ii) past or future open market or other transactions by any Purchaser, specifically including, without
limitation, Short Sales or “derivative” transactions, before or after the closing of this or future private placement
transactions, may negatively impact the market price of the Company’s publicly-traded securities; (iii) any Purchaser, and
counter-parties in “derivative” transactions to which any such Purchaser is a party, directly or indirectly, presently
may have a “short” position in the Common Shares, and (iv) each Purchaser shall not be deemed to have any affiliation
with or control over any arm’s length counter-party in any “derivative” transaction.The
Company further understands and acknowledges that (y) one or more Purchasers may


 






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engage
in hedging activities at various times during the period that the Securities are outstanding, including, without limitation, during
the periods that the value of the Warrant Shares deliverable with respect to Securities are being determined, and (z) such hedging
activities (if any) could reduce the value of the existing shareholders' equity interests in the Company at and after the time
that the hedging activities are being conducted.  The Company acknowledges that such aforementioned hedging activities do
not constitute a breach of any of the Transaction Documents.


 


(vv)         Private Placement. Assuming the accuracy of the Purchasers’ representations and warranties set forth in Section
3.2, no registration under the Securities Act is required for the offer and sale of the Warrants or the Warrant Shares by the
Company to the Purchasers as contemplated hereby.


 


(ww)       
No General Solicitation. Neither the Company nor any Person acting on behalf of the Company has offered or sold
any of the Warrant or Warrant Shares by any form of general solicitation or general advertising. The Company has offered the Warrants
and Warrant Shares for sale only to the Purchasers and certain other “accredited investors” within the meaning of
Rule 501 under the Securities Act.


 


(xx)          No Disqualification Events. With respect to the Warrants and Warrant Shares to be offered and sold hereunder in
reliance on Rule 506 under the Securities Act, none of the Company, any of its predecessors, any affiliated issuer, nor to the
knowledge of the Company, any director, executive officer, other officer of the Company participating in the offering hereunder,
any beneficial owner of 20% or more of the Company’s outstanding voting equity securities, calculated on the basis of voting
power, nor any promoter (as that term is defined in Rule 405 under the Securities Act) connected with the Company in any capacity
at the time of sale (each, an “Issuer Covered Person”) is subject to any of the “Bad Actor” disqualifications
described in Rule 506(d)(1)(i) to (viii) under the Securities Act (a “Disqualification Event”), except for
a Disqualification Event covered by Rule 506(d)(2) or (d)(3). The Company has exercised reasonable care to determine whether any
Issuer Covered Person is subject to a Disqualification Event. The Company has complied, to the extent applicable, with its disclosure
obligations under Rule 506(e), and has furnished to the Purchasers a copy of any disclosures provided thereunder.


 


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


 


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


 


The
Company has a reasonable basis for making each of the representations and warranties set forth in this Section 3.1.


 






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3.2           Representations and Warranties of the Purchasers. Each Purchaser, for itself and for no other Purchaser, hereby
represents and warrants as of the date hereof and as of the Closing Date to the Company as follows (unless as of a specific date
therein, in which case they shall be accurate as of such date):


 


(a)           Organization; Authority. Such Purchaser is either an individual or an entity duly incorporated or formed, validly
existing and in good standing under the laws of the jurisdiction of its incorporation or formation with full right, corporate,
partnership, limited liability company or similar power and authority to enter into and to consummate the transactions contemplated
by the Transaction Documents and otherwise to carry out its obligations hereunder and thereunder. The execution and delivery of
the Transaction Documents and performance by such Purchaser of the transactions contemplated by the Transaction Documents have
been duly authorized by all necessary corporate, partnership, limited liability company or similar action, as applicable, on the
part of such Purchaser. Each Transaction Document to which it is a party has been duly executed by such Purchaser, and when delivered
by such Purchaser in accordance with the terms hereof, will constitute the valid and legally binding obligation of such Purchaser,
enforceable against it in accordance with its terms, except: (i) as limited by general equitable principles and applicable bankruptcy,
insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors’ rights
generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable
remedies and (iii) insofar as indemnification and contribution provisions may be limited by applicable law.


 


(b)           Understandings or Arrangements. Such Purchaser is acquiring the Securities as principal for its own account and
has no direct or indirect arrangement or understandings with any other persons to distribute or regarding the distribution of
such Securities (this representation and warranty not limiting such Purchaser’s right to sell the Securities pursuant to
the Registration Statement or otherwise in compliance with applicable federal and state securities laws). Such Purchaser is acquiring
the Securities hereunder in the ordinary course of its business. Such Purchaser understands that the Warrants and the Warrant
Shares are “restricted securities” and have not been registered under the Securities Act or any applicable state securities
law and is acquiring such Securities as principal for his, her or its own account and not with a view to or for distributing or
reselling such Securities or any part thereof in violation of the Securities Act or any applicable state securities law, has no
present intention of distributing any of such Securities in violation of the Securities Act or any applicable state securities
law and has no direct or indirect arrangement or understandings with any other persons to distribute or regarding the distribution
of such Securities in violation of the Securities Act or any applicable state securities law (this representation and warranty
not limiting such Purchaser’s right to sell such Securities pursuant to a registration statement or otherwise in compliance
with applicable federal and state securities laws).


 


(c)           Purchaser Status. At the time such Purchaser was offered the Securities, it was, and as of the date hereof it is,
and on the Closing Date it will be,


 






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and
on and on each date on which it exercises any Warrants, it will be either: (i) an “accredited investor” as defined
in Rule 501(a)(1), (a)(2), (a)(3), (a)(7) or (a)(8) under the Securities Act or (ii) a “qualified institutional buyer”
as defined in Rule 144A(a) under the Securities Act.


 


(d)           Experience of Such Purchaser. Such Purchaser, either alone or together with its representatives, has such knowledge,
sophistication and experience in business and financial matters so as to be capable of evaluating the merits and risks of the
prospective investment in the Securities, and has so evaluated the merits and risks of such investment. Such Purchaser is able
to bear the economic risk of an investment in the Securities and, at the present time, is able to afford a complete loss of such
investment.


 


(e)           Access to Information. Such Purchaser acknowledges that it has had the opportunity to review the Transaction Documents
(including all exhibits and schedules thereto), the information relating to material tax considerations of an investment in the
Warrant, set forth in Annex B hereto, and the SEC Reports and has been afforded, (i) the opportunity to ask such questions as
it has deemed necessary of, and to receive answers from, representatives of the Company concerning the terms and conditions of
the offering of the Securities and the merits and risks of investing in the Securities; (ii) access to information about the Company
and its financial condition, results of operations, business, properties, management and prospects sufficient to enable it to
evaluate its investment; and (iii) the opportunity to obtain such additional information that the Company possesses or can acquire
without unreasonable effort or expense that is necessary to make an informed investment decision with respect to the investment. 
Such Purchaser acknowledges and agrees that neither the Placement Agent nor any Affiliate of the Placement Agent has provided
such Purchaser with any information or advice with respect to the Securities nor is such information or advice necessary or desired. 
Neither the Placement Agent nor any Affiliate has made or makes any representation as to the Company or the quality of the Securities
and the Placement Agent and any Affiliate may have acquired non-public information with respect to the Company which such Purchaser
agrees need not be provided to it.  In connection with the issuance of the Securities to such Purchaser, none of the Company,
Placement Agent nor any of their respective Affiliates have acted as a financial advisor or fiduciary to such Purchaser.


 


(f)            Certain Transactions and Confidentiality. Other than consummating the transactions contemplated hereunder, such
Purchaser has not, nor has any Person acting on behalf of or pursuant to any understanding with such Purchaser, directly or indirectly
executed any purchases or sales, including Short Sales, of the securities of the Company during the period commencing as
of the time that such Purchaser first received a term sheet (written or oral) from the Company or any other Person representing
the Company setting forth the material terms of the transactions contemplated hereunder and ending immediately prior to the execution
hereof. Notwithstanding the foregoing, in the case of a Purchaser that is a multi-managed investment vehicle whereby separate
portfolio managers manage separate portions of such Purchaser’s assets and the portfolio managers have no direct


 






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knowledge
of the investment decisions made by the portfolio managers managing other portions of such Purchaser’s assets, the representation
set forth above shall only apply with respect to the portion of assets managed by the portfolio manager that made the investment
decision to purchase the Securities covered by this Agreement. Other than to other Persons party to this Agreement or to such
Purchaser’s representatives, including, without limitation, its officers, directors, partners, legal and other advisors,
employees, agents and Affiliates, such Purchaser has maintained the confidentiality of all disclosures made to it in connection
with this transaction (including the existence and terms of this transaction). Notwithstanding the foregoing, for the avoidance
of doubt, nothing contained herein shall constitute a representation or warranty, or preclude any actions, with respect to locating
or borrowing shares in order to effect Short Sales or similar transactions in the future.


 


(g)          
General Solicitation. Such Purchaser has a pre-existing relationship with the Company or the Placement Agent and is not
purchasing the Securities as a result of any advertisement, article, notice or other communication regarding the Securities published
in any newspaper, magazine or similar media or broadcast over television or radio or presented at any seminar or, to the knowledge
of such Purchaser, any other general solicitation or general advertisement.


 


The
Company acknowledges and agrees that the representations contained in this Section 3.2 shall not modify, amend or affect such
Purchaser’s right to rely on the Company’s representations and warranties contained in this Agreement or any representations
and warranties contained in any other Transaction Document or any other document or instrument executed and/or delivered in connection
with this Agreement or the consummation of the transactions contemplated hereby. Notwithstanding the foregoing, for the avoidance
of doubt, nothing contained herein shall constitute a representation or warranty, or preclude any actions, with respect to locating
or borrowing shares in order to effect Short Sales or similar transactions in the future.


 


ARTICLE
IV.

OTHER AGREEMENTS OF THE PARTIES


 


4.1           Removal of Legends.


 


(a)           The Warrants and Warrant Shares may only be disposed of in compliance with state and federal securities laws. In connection
with any transfer of Warrants or Warrant Shares other than pursuant to an effective registration statement or Rule 144, to the
Company or to an Affiliate of a Purchaser or in connection with a pledge as contemplated in Section 4.1(b), the Company may require
the transferor thereof to provide to the Company an opinion of counsel selected by the transferor and reasonably acceptable to
the Company, the form and substance of which opinion shall be reasonably satisfactory to the Company, to the effect that such
transfer does not require registration of such transferred Warrant under the Securities Act.


 






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(b)           The Purchasers agree to the imprinting, so long as is required by this Section 4.1, of a legend on any of the Warrants
or Warrant Shares in the following form:


 


NEITHER
THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY IS EXERCISABLE HAS BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO,
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. THIS SECURITY AND
THE SECURITIES ISSUABLE UPON EXERCISE OF THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT WITH A REGISTERED
BROKER-DEALER OR OTHER LOAN WITH A FINANCIAL INSTITUTION THAT IS AN “ACCREDITED INVESTOR” AS DEFINED IN RULE 501(a)
UNDER THE SECURITIES ACT OR OTHER LOAN SECURED BY SUCH SECURITIES.


 


The
Company acknowledges and agrees that a Purchaser may from time to time pledge pursuant to a bona fide margin agreement with a
registered broker-dealer or grant a security interest in some or all of the Warrants or Warrant Shares to a financial institution
that is an “accredited investor” as defined in Rule 501(a) under the Securities Act and, if required under the terms
of such arrangement, such Purchaser may transfer pledged or secured Warrants or Warrant Shares to the pledgees or secured parties.
Such a pledge or transfer would not be subject to approval of the Company and no legal opinion of legal counsel of the pledgee,
secured party or pledgor shall be required in connection therewith. Further, no notice shall be required of such pledge. At the
appropriate Purchaser’s expense, the Company will execute and deliver such reasonable documentation as a pledgee or secured
party of Warrants and Warrant Shares may reasonably request in connection with a pledge or transfer of the Warrants or Warrant
Shares.


 


(c)           Certificates evidencing the Warrant Shares shall not contain any legend (including the legend set forth in Section 4.1(b)
hereof): (i) while a registration statement covering the resale of such security is effective under the Securities Act, (ii) following
any sale of such Warrant Shares pursuant to an effective registration statement covering the resale of such Warrant Shares or
Rule 144, or (iii) if such legend is not required under applicable requirements of the Securities Act (including judicial interpretations
and pronouncements issued by the staff of the Commission). In the event that removal of the legend is permitted under applicable
requirements of the Securities Act, the Company shall cause its counsel to issue a legal opinion to the Transfer Agent or the
Purchaser


 






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promptly
if required by the Transfer Agent to effect the removal of the legend hereunder, or if requested by a Purchaser, respectively.
If all or any portion of a Warrant is exercised at a time when there is an effective registration statement to cover the resale
of the Warrant Shares, or if such Warrant Shares may be sold under Rule 144 or if such legend is not otherwise required under
applicable requirements of the Securities Act (including judicial interpretations and pronouncements issued by the staff of the
Commission) then such Warrant Shares shall be issued free of all legends. The Company agrees that following such time as such
legend is no longer required under this Section 4.1(c), the Company will, no later than the earlier of (i) two (2) Trading Days
and (ii) the number of Trading Days comprising the Standard Settlement Period (as defined below) following the delivery by a Purchaser
to the Company or the Transfer Agent of a certificate representing Warrant Shares, as applicable, issued with a restrictive legend
(such date, the “Legend Removal Date”), deliver or cause to be delivered to such Purchaser a certificate representing
such shares that is free from all restrictive and other legends. The Company may not make any notation on its records or give
instructions to the Transfer Agent that enlarge the restrictions on transfer set forth in this Section 4. Warrant Shares subject
to legend removal hereunder shall be transmitted by the Transfer Agent to the Purchaser by crediting the account of the Purchaser’s
prime broker with the Depository Trust Company System as directed by such Purchaser. As used herein, “Standard Settlement
Period” means the standard settlement period, expressed in a number of Trading Days, on the Company’s primary Trading
Market with respect to the Common Shares as in effect on the date of delivery of a certificate representing Warrant Shares issued
with a restrictive legend.


 


(d)           In addition to such Purchaser’s other available remedies, the Company shall pay to a Purchaser, in cash, (i) as partial
liquidated damages and not as a penalty, for each $1,000 of Warrant Shares (based on the VWAP of the Common Shares on the date
such Securities are submitted to the Transfer Agent) delivered for removal of the restrictive legend and subject to Section 4.1(c),
$5 per Trading Day (increasing to $10 per Trading Day five (5) Trading Days after such damages have begun to accrue) for each
Trading Day after the Legend Removal Date until such certificate is delivered without a legend and (ii) if the Company fails to
(a) issue and deliver (or cause to be delivered) to a Purchaser by the Legend Removal Date a certificate representing the Securities
so delivered to the Company by such Purchaser that is free from all restrictive and other legends and (b) if after the Legend
Removal Date such Purchaser purchases (in an open market transaction or otherwise) Common Shares to deliver in satisfaction of
a sale by such Purchaser of all or any portion of the number of Common Shares, or a sale of a number of Common Shares equal to
all or any portion of the number of Common Shares, that such Purchaser anticipated receiving from the Company without any restrictive
legend, then an amount equal to the excess of such Purchaser’s total purchase price (including brokerage commissions and
other out-of-pocket expenses, if any) for the Common Shares so purchased (including brokerage commissions and other out-of-pocket
expenses, if any) (the “Buy-In Price”) over the product of (A) such number of Warrant Shares that the Company


 






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was
required to deliver to such Purchaser by the Legend Removal Date multiplied by (B) the lowest closing sale price of the Common
Shares on any Trading Day during the period commencing on the date of the delivery by such Purchaser to the Company of the applicable
Warrant Shares (as the case may be) and ending on the date of such delivery and payment under this Section 4.1(d).


 


(e)           The Shares shall be issued free of legends.


 


4.2           Furnishing of Information.


 


(a)           Until the earliest of the time that (i) no Purchaser owns Warrants or (ii) the Warrants have expired, the Company covenants
to timely file (or obtain extensions in respect thereof and file within the applicable grace period) all reports required to be
filed by the Company after the date hereof pursuant to the Exchange Act even if the Company is not then subject to the reporting
requirements of the Exchange Act except in the event of a merger or acquisition transaction approved by the Board of Directors
that results in the Company not being subject to such reporting requirements.


 


(b)           At any time during the period commencing from the six (6) month anniversary of the date hereof and ending at such time
that all of the Warrant Shares not held by an Affiliate of the Company may be sold without the requirement for the Company to
be in compliance with Rule 144(c)(1) and otherwise without restriction or limitation pursuant to Rule 144, if the Company (i)
shall fail for any reason to satisfy the current public information requirement under Rule 144(c) or (ii) has ever been an issuer
described in Rule 144(i)(1)(i) or becomes an issuer in the future, and the Company shall fail to satisfy any condition set forth
in Rule 144(i)(2) (a “Public Information Failure”) then, in addition to such Purchaser’s other available
remedies, the Company shall pay to a Purchaser, in cash, as partial liquidated damages and not as a penalty, by reason of any
such delay in or reduction of its ability to sell the Warrant Shares, an amount in cash equal to two percent (2.0%) of the aggregate
Exercise Price of such Purchaser’s Warrants on the day of a Public Information Failure and on every thirtieth (30th) day
(pro rated for periods totaling less than thirty days) thereafter until the earlier of (a) the date such Public Information Failure
is cured and (b) such time that such public information is no longer required for the Purchasers to transfer the Warrant Shares
pursuant to Rule 144. The payments to which a Purchaser shall be entitled pursuant to this Section 4.2(b) are referred to herein
as “Public Information Failure Payments.” Public Information Failure Payments shall be paid on the earlier
of (i) the last day of the calendar month during which such Public Information Failure Payments are incurred and (ii) the third
(3rd) Business Day after the event or failure giving rise to the Public Information Failure Payments is cured. In the event the
Company fails to make Public Information Failure Payments in a timely manner, such Public Information Failure Payments shall bear
interest at the rate of 1.5% per month (prorated for partial months) until paid in full. Nothing herein shall limit such Purchaser’s
right to pursue actual damages for the Public Information Failure, and such Purchaser


 






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shall
have the right to pursue all remedies available to it at law or in equity including, without limitation, a decree of specific
performance and/or injunctive relief.


 


4.3 
Integration. The Company shall not sell, offer for sale or solicit offers to buy or otherwise negotiate in respect
of any security (as defined in Section 2 of the Securities Act) that would be integrated with the offer or sale of the Securities
in a manner that would require the registration under the Securities Act of the sale of the Warrants or Warrant Shares or that
would be integrated with the offer or sale of the Securities for purposes of the rules and regulations of any Trading Market such
that it would require shareholder approval prior to the closing of such other transaction unless shareholder approval is obtained
before the closing of such subsequent transaction.


 


4.4           Securities Laws Disclosure; Publicity. The Company shall (a) by 9:30 a.m. (New York
City time)  on the date the Capital Increase is registered and deemed effective pursuant to the laws of Switzerland, but
in no event later than 5:00 p.m. (New York City time) on the first Trading Day immediately following the date hereof, issue a
press release disclosing the material terms of the transactions contemplated hereby, and (b) file a Current Report on Form
6-K, including the Transaction Documents as exhibits thereto, with the Commission within the time required by the Exchange Act.
From and after the issuance of such press release, the Company represents to the Purchasers that it shall have publicly disclosed
all material, non-public information delivered to any of the Purchasers by the Company or any of its Subsidiaries, or any of their
respective officers, directors, employees or agents in connection with the transactions contemplated by the Transaction Documents.
In addition, effective upon the issuance of such press release, the Company acknowledges and agrees that any and all confidentiality
or similar obligations under any agreement, whether written or oral, between the Company, any of its Subsidiaries or any of their
respective officers, directors, agents, employees or Affiliates on the one hand, and any of the Purchasers or any of their Affiliates
on the other hand, shall terminate. The Company and each Purchaser shall consult with each other in issuing any other press releases
with respect to the transactions contemplated hereby, and neither the Company nor any Purchaser shall issue any such press release
nor otherwise make any such public statement without the prior consent of the Company, with respect to any press release of any
Purchaser, or without the prior consent of each Purchaser, with respect to any press release of the Company, which consent shall
not unreasonably be withheld or delayed, except if such disclosure is required by law, in which case the disclosing party shall
promptly provide the other party with prior notice of such public statement or communication. Notwithstanding the foregoing, the
Company shall not publicly disclose the name of any Purchaser, or include the name of any Purchaser in any filing with the Commission
or any regulatory agency or Trading Market, without the prior written consent of such Purchaser, except (a) as required by federal
securities law in connection with the filing of final Transaction Documents with the Commission and (b) to the extent such disclosure
is required by law or Trading Market regulations, in which case the Company shall provide the Purchasers with prior notice of
such disclosure permitted under this clause (b), to the extent reasonably practical.


 






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


 


4.6           Non-Public Information. Except with respect to the material terms and conditions of the transactions contemplated
by the Transaction Documents, which shall be disclosed pursuant to Section 4.4, the Company covenants and agrees that neither
it, nor any other Person acting on its behalf will provide any Purchaser or its agents or counsel with any information that constitutes,
or the Company reasonably believes constitutes, material non-public information, unless prior thereto such Purchaser shall have
consented to the receipt of such information and agreed with the Company to keep such information confidential. The Company understands
and confirms that each Purchaser shall be relying on the foregoing covenant in effecting transactions in securities of the Company.
To the extent that the Company delivers any material, non-public information to a Purchaser without such Purchaser’s consent,
the Company hereby covenants and agrees that such Purchaser shall not have any duty of confidentiality to the Company, any of
its Subsidiaries, or any of their respective officers, directors, agents, employees or Affiliates, or a duty to the Company, any
of its Subsidiaries or any of their respective officers, directors, agents, employees or Affiliates not to trade on the basis
of, such material, non-public information, provided that the Purchaser shall remain subject to applicable law. To the extent that
any notice provided pursuant to any Transaction Document constitutes, or contains, material, non-public information regarding
the Company or any Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to a Current Report
on Form 6-K. The Company understands and confirms that each Purchaser shall be relying on the foregoing covenant in effecting
transactions in securities of the Company.


 


4.7           Use of Proceeds. The Company shall use the net proceeds from the sale of the Securities hereunder for working capital
purposes and shall not use such proceeds: (a) for the satisfaction of any portion of the Company’s debt (other than payment
of trade payables in the ordinary course of the Company’s business and prior practices), (b) for the redemption of any Common
Shares or Common Share Equivalents, (c) for the settlement of any outstanding litigation or (d) in violation of FCPA or OFAC regulations.


 


4.8           Indemnification of Purchasers. Subject to the provisions of this Section 4.8, the Company will indemnify and hold
each Purchaser and its directors, officers, shareholders, members, partners, employees and agents (and any other Persons with
a functionally equivalent role of a Person holding such titles notwithstanding a lack of such title or any other title), each
Person who controls such Purchaser (within the meaning of Section 15 of the Securities Act and Section 20 of the Exchange Act),
and the directors, officers, shareholders, agents, members, partners or employees (and any other Persons with a functionally equivalent
role of a Person holding such titles notwithstanding a lack


 






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of
such title or any other title) of such controlling persons (each, a “Purchaser Party”) harmless from any and
all losses, liabilities, obligations, claims, contingencies, damages, costs and expenses, including all judgments, amounts paid
in settlements, court costs and reasonable attorneys’ fees and costs of investigation that any such Purchaser Party may
suffer or incur as a result of or relating to (a) any material breach of any of the representations, warranties, covenants or
agreements made by the Company in this Agreement or in the other Transaction Documents or (b) any action instituted against the
Purchaser Parties in any capacity, or any of them or their respective Affiliates, by any shareholder of the Company who is not
an Affiliate of such Purchaser Party, with respect to any of the transactions contemplated by the Transaction Documents (unless
such action is based upon a breach of such Purchaser Party’s representations, warranties or covenants under the Transaction
Documents or any agreements or understandings such Purchaser Party may have with any such shareholder or any violations by such
Purchaser Party of state or federal securities laws or any conduct by such Purchaser Party which constitutes fraud, gross negligence,
willful misconduct or malfeasance) or (c) in connection with any registration statement of the Company providing for the resale
by the Purchasers of the Warrant Shares issued and issuable upon exercise of the Warrants, from and against any and all losses,
claims, damages, liabilities, costs (including, without limitation, reasonable attorneys’ fees) and expenses, as incurred,
arising out of or relating to (i) any untrue or alleged untrue statement of a material fact contained in such registration statement,
any prospectus or any related form of prospectus or in any amendment or supplement thereto or in any preliminary prospectus, or
arising out of or relating to any omission or alleged omission of a material fact required to be stated therein or necessary to
make the statements therein (in the case of any prospectus or supplement thereto, in the light of the circumstances under which
they were made) not misleading, except to the extent, but only to the extent, that such untrue statements or omissions are based
solely upon information regarding such Purchaser furnished in writing to the Company by such Purchaser expressly for use therein,
or (ii) any violation or alleged violation by the Company of the Securities Act, the Exchange Act or any state securities law,
or any rule or regulation thereunder in connection therewith. If any action shall be brought against any Purchaser Party in respect
of which indemnity may be sought pursuant to this Agreement, such Purchaser Party shall promptly notify the Company in writing,
and the Company shall have the right to assume the defense thereof with counsel of its own choosing reasonably acceptable to the
Purchaser Party. Any Purchaser Party shall have the right to employ separate counsel in any such action and participate in the
defense thereof, but the fees and expenses of such counsel shall be at the expense of such Purchaser Party except to the extent
that (i) the employment thereof has been specifically authorized by the Company in writing, (ii) the Company has failed after
a reasonable period of time to assume such defense and to employ counsel or (iii) in such action there is, in the reasonable opinion
of counsel, a material conflict on any material issue between the position of the Company and the position of such Purchaser Party,
in which case the Company shall be responsible for the reasonable fees and expenses of no more than one such separate counsel.
The Company will not be liable to any Purchaser Party under this Agreement (y) for any settlement by a Purchaser Party effected
without the Company’s prior written consent, which shall not be unreasonably withheld or delayed; or (z) to the extent,
but only to the extent that a loss, claim, damage


 






    32 


     


    

 


or liability is attributable to any Purchaser Party’s breach of any of
the representations, warranties, covenants or agreements made by such Purchaser Party in this Agreement or in the other Transaction
Documents. The indemnification required by this Section 4.8 shall be made by periodic payments of the amount thereof during the
course of the investigation or defense, as and when bills are received or are incurred. The indemnity agreements contained herein
shall be in addition to any cause of action or similar right of any Purchaser Party against the Company or others and any liabilities
the Company may be subject to pursuant to law.


 


4.9           Reservation of Common Shares. As of the date hereof, the Company has reserved and the Company shall continue to
reserve and keep available at all times, free of preemptive rights, a sufficient number of Common Shares for the purpose of enabling
the Company to issue Shares pursuant to this Agreement and Warrant Shares pursuant to any exercise of the Warrants.


 


4.10         Listing of Common Shares. The Company hereby agrees to use best efforts to maintain the listing or quotation of
the Common Shares on the Trading Market on which it is currently listed, and concurrently with the Closing, the Company shall
apply to list or quote all of the Shares and Warrant Shares on such Trading Market and promptly secure the listing of all of the
Shares and Warrant Shares on such Trading Market. The Company further agrees, if the Company applies to have the Common Shares
traded on any other Trading Market, it will then include in such application all of the Shares and Warrant Shares, and will take
such other action as is necessary to cause all of the Shares and Warrant Shares to be listed or quoted on such other Trading Market
as promptly as possible. The Company will then take all action reasonably necessary to continue the listing and trading of its
Common Shares on a Trading Market and will comply in all respects with the Company’s reporting, filing and other obligations
under the bylaws or rules of the Trading Market. The Company agrees to maintain the eligibility of the Common Shares for electronic
transfer through the Depository Trust Company or another established clearing corporation, including, without limitation, by timely
payment of fees to the Depository Trust Company or such other established clearing corporation in connection with such electronic
transfer.


 


4.11        
Reserved.


 


4.12        
Subsequent Equity Sales.


 


(a)           From the date hereof until the earlier of (i) the sixty (60) day anniversary of the Closing Date, and (ii) the Trading
Day on which the closing bid price on the primary Trading Market exceeds $0.88 and the aggregate volume in the preceding five
consecutive Trading Days exceeds $5,500,000, neither the Company nor any Subsidiary shall issue, enter into any agreement to issue
or announce the issuance or proposed issuance of any Common Shares or Common Share Equivalents.


 


(b)           From the date hereof until ninety (90) days after the Closing Date, the Company shall be prohibited from effecting or entering
into an agreement to


 






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effect
any issuance by the Company or any of its Subsidiaries of Common Share or Common Share Equivalents (or a combination of units
thereof) involving a Variable Rate Transaction. “Variable Rate Transaction” means a transaction in which the
Company (i) issues or sells any debt or equity securities that are convertible into, exchangeable or exercisable for, or include
the right to receive additional Common Shares either (A) at a conversion price, exercise price or exchange rate or other price
that is based upon and/or varies with the trading prices of or quotations for the Common Shares at any time after the initial
issuance of such debt or equity securities, or (B) with a conversion, exercise or exchange price that is subject to being reset
at some future date after the initial issuance of such debt or equity security or upon the occurrence of specified or contingent
events directly or indirectly related to the business of the Company or the market for the Common Shares or (ii) enters into,
or effects a transaction under, any agreement, including, but not limited to, an equity line of credit, whereby the Company may
issue securities at a future determined price. Any Purchaser shall be entitled to obtain injunctive relief against the Company
to preclude any such issuance, which remedy shall be in addition to any right to collect damages.


 


(c)           Notwithstanding the foregoing, this Section 4.12 shall not apply in respect of an Exempt Issuance, except that no Variable
Rate Transaction shall be an Exempt Issuance.


 


4.13       
Equal Treatment of Purchasers. No consideration (including any modification of any Transaction Document) shall be
offered or paid to any Person to amend or consent to a waiver or modification of any provision of this Agreement unless the same
consideration is also offered to all of the parties to this Agreement. For clarification purposes, this provision constitutes
a separate right granted to each Purchaser by the Company and negotiated separately by each Purchaser, and is intended for the
Company to treat the Purchasers as a class and shall not in any way be construed as the Purchasers acting in concert or as a group
with respect to the purchase, disposition or voting of Securities or otherwise.


 


4.14        
Certain Transactions and Confidentiality. Each Purchaser, severally and not jointly with the other Purchasers, covenants
that neither it nor any Affiliate acting on its behalf or pursuant to any understanding with it will execute any purchases or
sales, including Short Sales of any of the Company’s securities during the period commencing with the execution of this
Agreement and ending at such time that the transactions contemplated by this Agreement are first publicly announced pursuant to
the initial press release as described in Section 4.4.  Each Purchaser, severally
and not jointly with the other Purchasers, covenants that until such time as the transactions contemplated by this Agreement are
publicly disclosed by the Company pursuant to the initial press release as described in Section 4.4, such Purchaser will maintain
the confidentiality of the existence and terms of this transaction and shall not trade in the securities of the Company. 
Notwithstanding the foregoing and notwithstanding anything contained in this Agreement to the
contrary, the Company expressly acknowledges and agrees that (i) no Purchaser makes any representation, warranty or covenant hereby
that it will not engage


 






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in
effecting transactions in any securities of the Company after the time that the transactions contemplated by this Agreement are
first publicly announced pursuant to the initial press release as described in Section 4.4, (ii) no Purchaser shall be restricted
or prohibited from effecting any transactions in any securities of the Company in accordance with applicable securities laws from
and after the time that the transactions contemplated by this Agreement are first publicly announced pursuant to the initial press
release as described in Section 4.4 and (iii) no Purchaser shall have any duty of confidentiality or duty not to trade in the
securities of the Company to the Company or its Subsidiaries after the issuance of the initial press release as described in Section
4.4.  Notwithstanding the foregoing, in the case of a Purchaser that is a multi-managed
investment vehicle whereby separate portfolio managers manage separate portions of such Purchaser’s assets and the portfolio
managers have no direct knowledge of the investment decisions made by the portfolio managers managing other portions of such Purchaser’s
assets, the covenant set forth above shall only apply with respect to the portion of assets managed by the portfolio manager that
made the investment decision to purchase the Securities covered by this Agreement.


 


4.15        
Exercise Procedures. The form of Notice of Exercise included in the Warrants set
forth the totality of the procedures required of the Purchasers in order to exercise the Warrants. No additional legal opinion,
other information or instructions shall be required of the Purchasers to exercise their Warrants. Without limiting the preceding
sentences, no medallion guarantee (or other type of guarantee or notarization) of any Notice of Exercise form be required in order
to exercise the Warrants. The Company shall honor exercises of the Warrants and shall deliver Warrant Shares in accordance with
the terms, conditions and time periods set forth in the Transaction Documents.


 


4.16        
Form D; Blue Sky Filings. The Company agrees to timely file a Form D with respect
to the Warrant and Warrant Shares as required under Regulation D and to provide a copy thereof, promptly upon request of any Purchaser.
The Company shall take such action as the Company shall reasonably determine is necessary in order to obtain an exemption for,
or to qualify the Warrant and Warrant Shares for, sale to the Purchasers at the Closing under applicable securities or “Blue
Sky” laws of the states of the United States, and shall provide evidence of such actions promptly upon request of any Purchaser.


 


4.17       
Registration Statement. As soon as practicable (and in any event within 15
calendar days of the date of this Agreement), the Company shall file a registration statement on Form F-1 providing for the resale
by the Purchasers of the Warrant Shares issued and issuable upon exercise of the Warrants, which registration statement shall
include a “plan of distribution” substantially in the form of Annex A hereto. The Company shall use commercially reasonable
efforts to cause such registration to become effective within 90 days following the Closing Date (such date, the “Required
Effectiveness Date”) and to keep such registration statement effective at all times until no Purchaser owns any Warrants
or Warrant Shares issuable upon exercise thereof. In the event that a new registration statement on Form F-1 providing for the
resale by the Purchasers of the Warrant Shares issued and issuable upon exercise of the Warrants is


 






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required
to be filed, or an amendment to the existing registration statement on Form F-1 is required to be filed to provide for such resales
as a result of the merger of the Company into a wholly-owned subsidiary of the Company, the Company shall, as soon as practicable
(and in any event within 15 calendar days of the date of the consummation of such merger), file such new registration statement
on Form F-1 or amendment to the registration statement on Form F-1 and shall use commercially reasonable efforts to cause such
registration to become effective within 90 days following the date of the consummation of such merger and to keep such registration
statement effective at all times until no Purchaser owns any Warrants or Warrant Shares issuable upon exercise thereof. Notwithstanding
the foregoing, if such merger occurs on or before March 26, 2018, “Required Effectiveness Date” shall mean the 90
day anniversary of March 26, 2018.


 


4.18        
Passive Foreign Investment Company.  At the request of a Purchaser that owns
Securities, the Company agrees that within ninety (90 days) following the end of each fiscal year in which it believes it is likely
that it will be classified as a “passive foreign investment company” (“PFIC”), it will provide each such
requesting Purchaser with such information and take such actions as are reasonably necessary to allow each such Purchaser
to make a Qualified Electing Fund (“QEF”) election with respect to such Purchaser’s Shares.


 


ARTICLE
V.

MISCELLANEOUS


 


5.1           Termination.  This Agreement may be terminated by any Purchaser, as to such Purchaser’s obligations hereunder
only and without any effect whatsoever on the obligations between the Company and the other Purchasers, by written notice to the
other parties, if the Closing has not been consummated with respect to such Purchaser on or before the Closing Date for such Purchaser
as set forth in the definition of “Closing Date”; provided, however, that no such termination will affect
the right of any party to sue for any breach by any other party (or parties).


 


5.2           Fees and Expenses. Except as expressly set forth in the Transaction Documents to the contrary, each party shall
pay the fees and expenses of its advisers, counsel, accountants and other experts, if any, and all other expenses incurred by
such party incident to the negotiation, preparation, execution, delivery and performance of this Agreement. The Company shall
pay all Transfer Agent fees (including, without limitation, any fees required for same-day processing of any instruction letter
delivered by the Company and any exercise notice delivered by a Purchaser), stamp taxes and other taxes and duties levied in connection
with the delivery of any Securities to the Purchasers.


 


5.3           Entire Agreement. The Transaction Documents, together with the exhibits and schedules thereto, the Prospectus and
the Prospectus Supplement, contain the entire understanding of the parties with respect to the subject matter hereof and thereof
and supersede all prior agreements and understandings, oral or written, with respect to such


 






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matters,
which the parties acknowledge have been merged into such documents, exhibits and schedules.


 


5.4           Notices. Any and all notices or other communications or deliveries required or permitted to be provided hereunder
shall be in writing and shall be deemed given and effective on the earliest of: (a) the date of transmission, if such notice or
communication is delivered via facsimile at the facsimile number or email attachment at the email address as set forth on the
signature pages attached hereto at or prior to 5:30 p.m. (New York City time) on a Trading Day, (b) the next Trading Day after
the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number or email attachment
at the email address as set forth on the signature pages attached hereto on a day that is not a Trading Day or later than 5:30
p.m. (New York City time) on any Trading Day, (c) the second (2nd) Trading Day following the date of mailing, if sent
by U.S. nationally recognized overnight courier service or (d) upon actual receipt by the party to whom such notice is required
to be given. The address for such notices and communications shall be as set forth on the signature pages attached hereto. To
the extent that any notice provided pursuant to any Transaction Document constitutes, or contains, material, non-public information
regarding the Company or any Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to a
Current Report on Form 6-K.


 


5.5           Amendments; Waivers. No provision of this Agreement may be waived, modified, supplemented or amended except in a
written instrument signed, in the case of an amendment, by the Company and Purchasers which purchased at least 50.1% in interest
of the Shares based on the initial Subscription Amounts hereunder or, in the case of a waiver, by the party against whom enforcement
of any such waived provision is sought, provided that if any amendment, modification or waiver disproportionately and adversely
impacts a Purchaser (or group of Purchasers), the consent of such disproportionately impacted Purchaser (or group of Purchasers)
shall also be required. No waiver of any default with respect to any provision, condition or requirement of this Agreement shall
be deemed to be a continuing waiver in the future or a waiver of any subsequent default or a waiver of any other provision, condition
or requirement hereof, nor shall any delay or omission of any party to exercise any right hereunder in any manner impair the exercise
of any such right. Any proposed amendment or waiver that disproportionately, materially and adversely affects the rights and obligations
of any Purchaser relative to the comparable rights and obligations of the other Purchasers shall require the prior written consent
of such adversely affected Purchaser, Any amendment effected in accordance with accordance with this Section 5.5 shall be binding
upon each Purchaser and holder of Securities and the Company.


 


5.6           Headings. The headings herein are for convenience only, do not constitute a part of this Agreement and shall not
be deemed to limit or affect any of the provisions hereof.


 


5.7           Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their successors
and permitted assigns. The Company may not assign this Agreement or any rights or obligations hereunder without the prior


 






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written
consent of each Purchaser (other than by merger). Any Purchaser may assign any or all of its rights under this Agreement to any
Person to whom such Purchaser assigns or transfers any Securities, provided that such transferee agrees in writing to be bound,
with respect to the transferred Securities, by the provisions of the Transaction Documents that apply to the “Purchasers.”


 


5.8           No Third-Party Beneficiaries. The Placement Agent shall be the third party beneficiary of the representations and
warranties of the Company in Section 3.1 and the representations and warranties of the Purchasers in Section 3.2. This Agreement
is intended for the benefit of the parties hereto and their respective successors and permitted assigns and is not for the benefit
of, nor may any provision hereof be enforced by, any other Person, except as otherwise set forth in Section 4.8 and this Section
5.8.


 


5.9           Governing Law. All questions concerning the construction, validity, enforcement and interpretation of the Transaction
Documents shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, without
regard to the principles of conflicts of law thereof. Each party agrees that all legal Proceedings concerning the interpretations,
enforcement and defense of the transactions contemplated by this Agreement and any other Transaction Documents (whether brought
against a party hereto or its respective affiliates, directors, officers, shareholders, partners, members, employees or agents)
shall be commenced exclusively in the state and federal courts sitting in the City of New York. Each party hereby irrevocably
submits to the exclusive jurisdiction of the state and federal courts sitting in the City of New York, Borough of Manhattan for
the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein
(including with respect to the enforcement of any of the Transaction Documents), and hereby irrevocably waives, and agrees not
to assert in any Action or Proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that
such Action or Proceeding is improper or is an inconvenient venue for such Proceeding. Each party hereby irrevocably waives personal
service of process and consents to process being served in any such Action or Proceeding by mailing a copy thereof via registered
or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under
this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing
contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law. If any party
shall commence an Action or Proceeding to enforce any provisions of the Transaction Documents, then, in addition to the obligations
of the Company under Section 4.8, the prevailing party in such Action or Proceeding shall be reimbursed by the non-prevailing
party for its reasonable attorneys’ fees and other costs and expenses incurred with the investigation, preparation and prosecution
of such Action or Proceeding.


 


5.10        
Survival. The representations and warranties contained herein shall survive the Closing and the delivery of the
Securities.


 


5.11        
Execution. This Agreement may be executed in two or more counterparts, all of which when taken together shall be
considered one and the same agreement and


 






    38 


     


    

 


shall
become effective when counterparts have been signed by each party and delivered to each other party, it being understood that
the parties need not sign the same counterpart. In the event that any signature is delivered by facsimile transmission or by e-mail
delivery of a “.pdf” format data file, such signature shall create a valid and binding obligation of the party executing
(or on whose behalf such signature is executed) with the same force and effect as if such facsimile or “.pdf” signature
page were an original thereof.


 


5.12        
Severability. If any term, provision, covenant or restriction of this Agreement is held by a court of competent
jurisdiction to be invalid, illegal, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions
set forth herein shall remain in full force and effect and shall in no way be affected, impaired or invalidated, and the parties
hereto shall use their commercially reasonable efforts to find and employ an alternative means to achieve the same or substantially
the same result as that contemplated by such term, provision, covenant or restriction. It is hereby stipulated and declared to
be the intention of the parties that they would have executed the remaining terms, provisions, covenants and restrictions without
including any of such that may be hereafter declared invalid, illegal, void or unenforceable.


 


5.13        
Rescission and Withdrawal Right. Notwithstanding anything to the contrary contained in (and without limiting any
similar provisions of) any of the other Transaction Documents, whenever any Purchaser exercises a right, election, demand or option
under a Transaction Document and the Company does not timely perform its related obligations within the periods therein provided,
then such Purchaser may rescind or withdraw, in its sole discretion from time to time upon written notice to the Company, any
relevant notice, demand or election in whole or in part without prejudice to its future actions and rights; provided, however,
that in the case of a rescission of an exercise of a Warrant, the applicable Purchaser shall be required to return any Common
Shares subject to any such rescinded exercise notice concurrently with the return to such Purchaser of the aggregate exercise
price paid to the Company for such shares and the restoration of such Purchaser’s right to acquire such shares pursuant
to such Purchaser’s Warrant (including, issuance of a replacement warrant certificate evidencing such restored right).


 


5.14        
Replacement of Securities. If any certificate or instrument evidencing any Securities is mutilated, lost, stolen
or destroyed, the Company shall issue or cause to be issued in exchange and substitution for and upon cancellation thereof (in
the case of mutilation or in the case required by mandatory Swiss law), or in lieu of and substitution therefor, a new certificate
or instrument, but only upon receipt of evidence reasonably satisfactory to the Company of such loss, theft or destruction. The
applicant for a new certificate or instrument under such circumstances shall also pay any reasonable third-party costs (including
customary indemnity) associated with the issuance of such replacement Securities.


 


5.15        
Remedies. In addition to being entitled to exercise all rights provided herein or granted by law, including recovery
of damages, each of the Purchasers and the Company will be entitled to specific performance under the Transaction Documents. The
parties agree that monetary damages may not be adequate compensation for any loss


 






    39 


     


    

 


incurred
by reason of any breach of obligations contained in the Transaction Documents and hereby agree to waive and not to assert in any
Action for specific performance of any such obligation the defense that a remedy at law would be adequate.


 


5.16        
Payment Set Aside. To the extent that the Company makes a payment or payments to any Purchaser pursuant to any Transaction
Document or a Purchaser enforces or exercises its rights thereunder, and such payment or payments or the proceeds of such enforcement
or exercise or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside, recovered
from, disgorged by or are required to be refunded, repaid or otherwise restored to the Company, a trustee, receiver or any other
Person under any law (including, without limitation, any bankruptcy law, state or federal law, common law or equitable cause of
action), then to the extent of any such restoration the obligation or part thereof originally intended to be satisfied shall be
revived and continued in full force and effect as if such payment had not been made or such enforcement or setoff had not occurred.


 


5.17        
Independent Nature of Purchasers’ Obligations and Rights. The obligations of each Purchaser under any Transaction
Document are several and not joint with the obligations of any other Purchaser, and no Purchaser shall be responsible in any way
for the performance or non-performance of the obligations of any other Purchaser under any Transaction Document. Nothing contained
herein or in any other Transaction Document, and no action taken by any Purchaser pursuant hereto or thereto, shall be deemed
to constitute the Purchasers as a partnership, an association, a joint venture or any other kind of entity, or create a presumption
that the Purchasers are in any way acting in concert or as a group with respect to such obligations or the transactions contemplated
by the Transaction Documents. Each Purchaser shall be entitled to independently protect and enforce its rights including, without
limitation, the rights arising out of this Agreement or out of the other Transaction Documents, and it shall not be necessary
for any other Purchaser to be joined as an additional party in any Proceeding for such purpose. Each Purchaser has been represented
by its own separate legal counsel in its review and negotiation of the Transaction Documents. For reasons of administrative convenience
only, each Purchaser and its respective counsel have chosen to communicate with the Company through EGS. EGS does not represent
any of the Purchasers and only represents the Placement Agent. The Company has elected to provide all Purchasers with the same
terms and Transaction Documents for the convenience of the Company and not because it was required or requested to do so by any
of the Purchasers. It is expressly understood and agreed that each provision contained in this Agreement and in each other Transaction
Document is between the Company and a Purchaser, solely, and not between the Company and the Purchasers collectively and not between
and among the Purchasers.


 


5.18        
Liquidated Damages. The Company’s obligations to pay any partial liquidated damages or other amounts owing
under the Transaction Documents is a continuing obligation of the Company and shall not terminate until all unpaid partial liquidated
damages and other amounts have been paid notwithstanding the fact that the instrument or security pursuant to which such partial
liquidated damages or other amounts are due and payable shall have been canceled.


 






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5.19        
Saturdays, Sundays, Holidays, etc.If the last or appointed day for the taking of any action or the expiration
of any right required or granted herein shall not be a Business Day, then such action may be taken or such right may be exercised
on the next succeeding Business Day.


 


5.20        
Construction. The parties agree that each of them and/or their respective counsel have reviewed and had an opportunity
to revise the Transaction Documents and, therefore, the normal rule of construction to the effect that any ambiguities are to
be resolved against the drafting party shall not be employed in the interpretation of the Transaction Documents or any amendments
thereto. In addition, each and every reference to share prices and Common Shares in any Transaction Document shall be subject
to adjustment for reverse and forward stock splits, stock dividends, stock combinations and other similar transactions of the
Common Shares that occur after the date of this Agreement.


 


5.21        
WAIVER OF JURY TRIAL. IN ANY ACTION, SUIT, OR PROCEEDING IN ANY JURISDICTION BROUGHT BY ANY PARTY AGAINST
ANY OTHER PARTY, EACH OF THE PARTIES KNOWINGLY AND INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY,
UNCONDITIONALLY, IRREVOCABLY AND EXPRESSLY WAIVES FOREVER TRIAL BY JURY. 


 


 


(Signature
Pages Follow)


 




    	 



    	 



    

 


IN
WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be duly executed by their respective authorized
signatories as of the date first indicated above.


 


	auris
        medical holding ag

         
	 	Address
for Notice:

        Bahnhofstrasse 21

        6300 Zug, Switzerland

	 	 	 
	 	 	 
	By:
	


	 	

        

         

	 	Name:	 	 	E-Mail: [XXXXXXXXXX]
	 	Title:	 	 	Fax:       [XXXXXXXXXX]
	 	 	 
	 	 	 



 


	With a copy to (which
        shall not constitute notice):	 	 
	 	 	 
	Davis Polk & Wardwell
LLP

        450 Lexington Avenue

        New York, New York 10017

        Telephone:  [XXXXXXXXXX]

        Facsimile:  [XXXXXXXXXX]

        E-mail:  [XXXXXXXXXX]

        Attention: Sophia Hudson,
Esq.
	 	 


 


 


[REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK


SIGNATURE
PAGE FOR PURCHASER FOLLOWS]


 




    	 



    	 



    

 


[PURCHASER
SIGNATURE PAGES TO EARS SECURITIES PURCHASE AGREEMENT]


 


IN
WITNESS WHEREOF, the undersigned have caused this Securities Purchase Agreement to be duly executed by their respective authorized
signatories as of the date first indicated above.


 


Name of
Purchaser: ________________________________________________________


 


Signature
of Authorized Signatory of Purchaser: _________________________________


 


Name of
Authorized Signatory: _______________________________________________


 


Title of
Authorized Signatory: ________________________________________________


 


Email Address
of Authorized Signatory:_________________________________________


 


Facsimile Number of Authorized
Signatory: __________________________________________


 


Address for Notice to Purchaser:


 


Address for Delivery of Warrants
to Purchaser (if not same as address for notice):


 


DWAC for Shares:


 


Subscription Amount: CHF_________________
(based on an exchange rate of $1.00 to CHF 0.9357 CHF 0.411708 = $0.44)


 


Shares: _________________


 


Warrant Shares: __________________


 


EIN Number: _______________________


 


o
Notwithstanding anything contained in this Agreement to the contrary, by checking this box
(i) the obligations of the above-signed to purchase the securities set forth in this Agreement to be purchased from the Company
by the above-signed, and the obligations of the Company to sell such securities to the above-signed, shall be unconditional and
all conditions to Closing shall be disregarded, (ii) the Closing shall occur on the date specified in this Agreement and (iii)
any condition to Closing contemplated by this Agreement (but prior to being disregarded by clause (i) above) that required delivery
by the Company or the above-signed of any agreement, instrument, certificate or the like or purchase price (as applicable) shall
no longer be a condition and shall instead be an unconditional obligation of the Company or the above-signed (as applicable) to
deliver such agreement, instrument, certificate or the like or purchase price (as applicable) to such other party on the Closing
Date.


 






    41 


     


    

 


[SIGNATURE
PAGES CONTINUE]



 


 


 


 


 


 


 


 


 


 


 






    42 


     


    

 


Schedule
I


 


Wire Instructions


 


Bank:  [XXXXXXXXXX]


 


New deposit account in the name
of:  [XXXXXXXXXX]


 


IBAN  [XXXXXXXXXX]


 


ACCOUNT number  [XXXXXXXXXX]


 


BIC:  [XXXXXXXXXX]


 




    	 



    	 



    

Schedule
II


 


Address
for Delivery of Subscription Form


 


Walder Wyss AG


 


Attn:  [XXXXXXXXXX]


 [XXXXXXXXXX]


 [XXXXXXXXXX]


 [XXXXXXXXXX]


 


Tel:  [XXXXXXXXXX]


Mobile:  [XXXXXXXXXX]


 




    	 



    	 



    

Annex A


 


Plan of
Distribution


 


Each
Selling Shareholder (the “Selling Shareholders”) of the securities and any of their pledgees, assignees and
successors-in-interest may, from time to time, sell any or all of their securities covered hereby on the principal Trading Market
or any other stock exchange, market or trading facility on which the securities are traded or in private transactions. These sales
may be at fixed or negotiated prices. A Selling Shareholder may use any one or more of the following methods when selling securities:


 


		·	ordinary
                                         brokerage transactions and transactions in which the broker-dealer solicits purchasers;



 


		·	block
                                         trades in which the broker-dealer will attempt to sell the securities as agent but may
                                         position and resell a portion of the block as principal to facilitate the transaction;



 


		·	purchases
                                         by a broker-dealer as principal and resale by the broker-dealer for its account;



 


		·	an
                                         exchange distribution in accordance with the rules of the applicable exchange;



 


		·	privately
                                         negotiated transactions;



 


		·	settlement
                                         of short sales;



 


		·	in
                                         transactions through broker-dealers that agree with the Selling Shareholders to sell
                                         a specified number of such securities at a stipulated price per security;



 


		·	through
                                         the writing or settlement of options or other hedging transactions, whether through an
                                         options exchange or otherwise;



 


		·	a
                                         combination of any such methods of sale; or



 


		·	any
                                         other method permitted pursuant to applicable law.



 


The
Selling Shareholders may also sell securities under Rule 144 or any other exemption from registration under the Securities Act
of 1933, as amended (the “Securities Act”), if available, rather than under this prospectus.


 


Broker-dealers
engaged by the Selling Shareholders may arrange for other brokers-dealers to participate in sales. Broker-dealers may receive
commissions or discounts from the Selling Shareholders (or, if any broker-dealer acts as agent for the purchaser of securities,
from the purchaser) in amounts to be negotiated, but, except as set forth in a supplement to this Prospectus, in the case of an
agency transaction not in


 






    43 


     


    

 


excess
of a customary brokerage commission in compliance with FINRA Rule 2440; and in the case of a principal transaction a markup or
markdown in compliance with FINRA IM-2440.


 


In
connection with the sale of the securities or interests therein, the Selling Shareholders may enter into hedging transactions
with broker-dealers or other financial institutions, which may in turn engage in short sales of the securities in the course of
hedging the positions they assume. The Selling Shareholders may also sell securities short and deliver these securities to close
out their short positions, or loan or pledge the securities to broker-dealers that in turn may sell these securities. The Selling
Shareholders may also enter into option or other transactions with broker-dealers or other financial institutions or create one
or more derivative securities which require the delivery to such broker-dealer or other financial institution of securities offered
by this prospectus, which securities such broker-dealer or other financial institution may resell pursuant to this prospectus
(as supplemented or amended to reflect such transaction).


 


The
Selling Shareholders and any broker-dealers or agents that are involved in selling the securities may be deemed to be “underwriters”
within the meaning of the Securities Act in connection with such sales. In such event, any commissions received by such broker-dealers
or agents and any profit on the resale of the securities purchased by them may be deemed to be underwriting commissions or discounts
under the Securities Act. Each Selling Shareholder has informed the Company that it does not have any written or oral agreement
or understanding, directly or indirectly, with any person to distribute the securities.


 


The
Company is required to pay certain fees and expenses incurred by the Company incident to the registration of the securities. The
Company has agreed to indemnify the Selling Shareholders against certain losses, claims, damages and liabilities, including liabilities
under the Securities Act.


 


We
agreed to keep this prospectus effective until the earlier of (i) the date on which the securities may be resold by the Selling
Shareholders without registration and without regard to any volume or manner-of-sale limitations by reason of Rule 144, without
the requirement for the Company to be in compliance with the current public information under Rule 144 under the Securities Act
or any other rule of similar effect or (ii) all of the securities have been sold pursuant to this prospectus or Rule 144 under
the Securities Act or any other rule of similar effect. The resale securities will be sold only through registered or licensed
brokers or dealers if required under applicable state securities laws. In addition, in certain states, the resale securities covered
hereby may not be sold unless they have been registered or qualified for sale in the applicable state or an exemption from the
registration or qualification requirement is available and is complied with.


 


Under
applicable rules and regulations under the Exchange Act, any person engaged in the distribution of the resale securities may not
simultaneously engage in market making activities with respect to the common shares for the applicable restricted period, as defined
in Regulation M, prior to the commencement of the distribution. In


 


 






    44 


     


    

 


addition,
the Selling Shareholders will be subject to applicable provisions of the Exchange Act and the rules and regulations thereunder,
including Regulation M, which may limit the timing of purchases and sales of the common shares by the Selling Shareholders or
any other person. We will make copies of this prospectus available to the Selling Shareholders and have informed them of the need
to deliver a copy of this prospectus to each purchaser at or prior to the time of the sale (including by compliance with Rule
172 under the Securities Act).


 




    	 



    	 



    

 


SELLING
SHAREHOLDERS


 


The
common shares being offered by the selling shareholders are those previously issued to the selling shareholders, and those issuable
to the selling shareholders, upon exercise of the warrants. For additional information regarding the issuances of those warrants,
see "Private Placement of Warrants" above. We are registering the common shares in order to permit the selling shareholders
to offer the shares for resale from time to time. Except for the ownership of the warrants, the selling shareholders have not
had any material relationship with us within the past three years.


 


The
table below lists the selling shareholders and other information regarding the beneficial ownership of the common by each of the
selling shareholders. The second column lists the number of common shares beneficially owned by each selling shareholder, based
on its ownership of the warrants, as of ________, 2018, assuming exercise of the warrants held by the selling shareholders on
that date, without regard to any limitations on exercises.


 


The
third column lists the common shares being offered by this prospectus by the selling shareholders.


 


In
accordance with the terms of a registration rights agreement with the selling shareholders, this prospectus generally covers the
resale of the sum of (i) the number of common shares issued to the selling shareholders in the __________________ and (ii) the
maximum number of common shares issuable upon exercise of the related warrants, determined as if the outstanding warrants were
exercised in full as of the trading day immediately preceding the date this registration statement was initially filed with the
SEC, each as of the trading day immediately preceding the applicable date of determination and all subject to adjustment as provided
in the registration right agreement, without regard to any limitations on the exercise of the warrants. The fourth column assumes
the sale of all of the shares offered by the selling shareholders pursuant to this prospectus.


 


Under
the terms of the warrants, a selling shareholder may not exercise the warrants to the extent such exercise would cause such selling
shareholder, together with its affiliates and attribution parties, to beneficially own a number of common shares which would exceed
[4.99]% of our then outstanding common shares following such exercise, excluding for purposes of such determination common shares
issuable upon exercise of the warrants which have not been exercised. The number of shares in the second column does not reflect
this limitation. The selling shareholders may sell all, some or none of their shares in this offering. See "Plan of Distribution."


 




    	 



    	 



    
 


	
    Name of Selling Shareholder	 	Number
    of common shares Owned Prior to Offering	 	Maximum
    Number of common shares to be Sold Pursuant to this Prospectus	 	Number
    of common shares  Owned After Offering


 


 


 


 



    	 



    	 



    
 


 


Annex
B


 


Material
Tax Consequences


 


Material Swiss Tax Considerations


 


This summary
of material Swiss tax consequences is based on Swiss law and regulations and the practice of the Swiss tax administration as in
effect on the date hereof, all of which are subject to change (or subject to changes in interpretation), possibly with retroactive
effect. The summary does not purport to take into account the specific circumstances of any particular shareholder or potential
investor and does not relate to persons in the business of buying and selling common shares or other securities. The summary is
not intended to be, and should not be interpreted as, legal or tax advice to any particular potential shareholder/s, and no representation
with respect to the tax consequences to any particular shareholder/s is made.


 


Current
and prospective shareholders are advised to consult their own tax advisers in light of their particular circumstances as to the
Swiss tax laws, regulations and regulatory practices that could be relevant for them in connection with the acquiring, owning
and selling or otherwise disposing of common shares and receiving dividends and similar cash or in-kind distributions on common
shares (including dividends on liquidation proceeds and stock dividends) or distributions on common shares based upon a capital
reduction (Nennwertrückzahlungen) or reserves paid out of capital contributions (Reserven aus Kapitaleinlagen)
and the consequences thereof under the tax laws, regulations and regulatory practices of Switzerland.


 


Swiss
Federal Withholding Tax on Dividends and other Distributions


 


Dividend
payments and similar cash or in-kind distributions on the common shares (including dividends on liquidation proceeds and stock
dividends) that the Company makes to shareholders are subject to Swiss federal withholding tax (Verrechnungssteuer) at
a rate of 35% on the gross amount of the dividend. The Company is required to withhold the Swiss federal withholding tax from
the dividend and remit it to the Swiss Federal Tax Administration. Distributions based upon a capital reduction (Nennwertrückzahlungen)
and reserves paid out of capital contributions (Reserven aus Kapitaleinlagen) are not subject to Swiss federal withholding
tax.


 


The redemption
of common shares in the Company may under certain circumstances (in particular, if the common shares in the Company are redeemed
for subsequent cancellation) be taxed as a partial liquidation for Swiss federal withholding tax purposes, with the consequence
that the difference between the repurchase price and the nominal value of the shares (Nennwertprinzip) plus capital contribution
reserves (Reserven aus Kapitaleinlagen) is subject to Swiss federal withholding tax.


 


The Swiss
federal withholding tax is refundable or creditable in full to a Swiss tax resident corporate and individual shareholder as well
as to a non-Swiss tax resident corporate or individual shareholder who holds the common shares as part of a trade or business
carried on in Switzerland through a permanent establishment or fixed place of business situated for tax purposes in Switzerland,
if such person is the beneficial owner of the distribution and, in the case of a Swiss tax resident individual who holds the common
shares as part of his private assets, duly reports the gross distribution received in his individual income tax return or, in
the case of a person who holds the common shares as part of a trade or business carried on in Switzerland through a permanent
establishment or fixed place of business situated for tax purposes in Switzerland, recognizes the gross dividend distribution
for tax purposes as earnings in the income statements and reports the annual profit in the Swiss income tax return.


 


If a shareholder
who is not a Swiss resident for tax purposes and does not hold the common shares in connection with the conduct of a trade or
business in Switzerland through a permanent establishment or fixed place of business situated, for tax purposes in Switzerland,
receives a distribution from the Company, the shareholder may be entitled to a full or partial refund or credit of Swiss federal
withholding tax incurred on a taxable distribution if the country in which such shareholder is resident for tax purposes has entered
into a treaty for the avoidance of double taxation with Switzerland and the further prerequisites of the treaty for a refund have
been met. Shareholders not resident in Switzerland should be aware that the procedures for claiming treaty benefits (and the time
required for obtaining a refund or credit) may differ from country to country.


 






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Besides
the bilateral treaties, on January 1, 2017 Switzerland implemented the agreement with the European Community regarding the Automatic
Exchange of Information in Tax Matters. This agreement contains in its Article 19 provisions on taxation of dividends which apply
with respect to EU member states and provides for an exemption of Withholding Tax for companies under certain circumstances.


 


Individual
and Corporate Income Tax on Dividends


 


Swiss resident
individuals holding the common shares as part of their private assets who receive dividends and similar distributions (including
stock dividends and liquidation proceeds), which are not repayments of the nominal value (Nennwertrückzahlungen) of
the common shares or reserves paid out of capital contributions (Reserven aus Kapitaleinlagen) are required to report such
payments in their individual income tax returns and are liable to Swiss federal, cantonal and communal income taxes on any net
taxable income for the relevant tax period. Furthermore, for the purpose of the Direct Federal Tax, dividends, shares in profits,
liquidation proceeds and pecuniary benefits from shares (including bonus shares) are included in the tax base for only 60% of
their value (Teilbesteuerung), if the investment amounts to at least 10% of nominal share capital of the Company. All Swiss
cantons have introduced similar partial taxation measures at cantonal and communal levels.


 


Swiss resident
individuals as well as non-Swiss resident individual taxpayers holding the common shares in connection with the conduct of a trade
or business in Switzerland through a permanent establishment or fixed place of business situated, for tax purposes, in Switzerland,
are required to recognize dividends, distributions based upon a capital reduction (Nennwertrückzahlungen) and reserves
paid out of capital contributions (Reserven aus Kapitaleinlagen) in their income statements for the relevant tax period
and are liable to Swiss federal, cantonal and communal individual or corporate income taxes, as the case may be, on any net taxable
earnings accumulated (including the payment of dividends) for such period. Furthermore, for the purpose of the Direct Federal
Tax, dividends, shares in profits, liquidation proceeds and pecuniary benefits from shares (including bonus shares) are included
in the tax base for only 50% (Teilbesteuerung), if the investment is held in connection with the conduct of a trade or
business or qualifies as an opted business asset (gewillkürtes Geschäftsvermögen) according to Swiss tax
law and amounts to at least 10% of nominal share capital of the Company. All cantons have introduced similar partial taxation
measures at cantonal and communal levels.


 


Swiss resident
corporate taxpayers as well as non-Swiss resident corporate taxpayers holding the common shares in connection with the conduct
of a trade or business through a permanent establishment or fixed place of business situated, for tax purposes, in Switzerland,
are required to recognize dividends, distributions based upon a capital reduction (Nennwertrückzahlungen) and reserves
paid out of capital contributions (Reserven aus Kapitaleinlagen) in their income statements for the relevant tax period
and are liable to Swiss federal, cantonal and communal corporate income taxes on any net taxable earnings accumulated for such
period. Swiss resident corporate taxpayers as well as non-Swiss resident corporate taxpayers holding the common shares in connection
with the conduct of a trade or business through a permanent establishment or fixed place of business situated, for tax purposes,
in Switzerland may be eligible for participation relief (Beteiligungsabzug) in respect of dividends and distributions based
upon a capital reduction (Nennwertrückzahlungen) and reserves paid out of capital contributions (Reserven aus Kapitaleinlagen)
if the common shares held by them as part of a Swiss business have an aggregate market value of at least CHF 1 million or represent
at least 10% of the nominal share capital of the Company or give entitlement to at least 10% of the profits and reserves of the
Company, respectively.


 


Recipients
of dividends and similar distributions on the common shares (including stock dividends and liquidation proceeds) who neither are
residents of Switzerland nor during the current taxation year have engaged in a trade or business in Switzerland and who are not
subject to taxation in Switzerland for any other reason are not subject to Swiss federal, cantonal or communal individual or corporate
income taxes in respect of dividend payments and similar distributions because of the mere holding of the common shares.


 


Wealth
and Annual Capital Tax on Holding of Common Shares or Warrants


 


Swiss resident
individuals and non-Swiss resident individuals holding the common shares or warrants in connection with the conduct of a trade
or business in Switzerland through a permanent establishment or fixed place of business situated, for tax purposes, in Switzerland,
are required to report their common shares or warrants as part of their wealth and will be subject to cantonal and communal wealth
tax to the extent the aggregate taxable net wealth is allocable to Switzerland.


 






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Swiss resident
corporate taxpayers and non-Swiss resident corporate taxpayers holding the common shares or warrants in connection with the conduct
of a trade or business in Switzerland through a permanent establishment or fixed place of business situated, for tax purposes,
in Switzerland, will be subject to cantonal and communal annual capital tax on the taxable capital to the extent the aggregate
taxable capital is allocable to Switzerland.


 


Individuals
and corporate taxpayers not resident in Switzerland for tax purposes and not holding the common shares or warrants in connection
with the conduct of a trade or business in Switzerland through a permanent establishment or fixed place of business situated,
for tax purposes, in Switzerland, are not subject to wealth or annual capital tax in Switzerland because of the mere holding of
the common shares.


 


Capital
Gains on Disposal of Common Shares or Warrants


 


Swiss resident
individuals who sell or otherwise dispose of the common shares or warrants realize a tax-free capital gain, or a non-deductible
capital loss, as the case may be, provided that they hold the common shares or warrants, as applicable, as part of their private
assets. Under certain circumstances, the sale proceeds may be requalified into taxable investment income (e.g., if the taxpayer
is deemed to be a professional securities dealer).


 


Capital
gains realized on the sale of the common shares or warrants held by Swiss resident individuals, Swiss resident corporate taxpayers
as well as non-Swiss resident individuals and corporate taxpayers holding the common shares or warrants in connection with the
conduct of a trade or business in Switzerland through a permanent establishment or fixed place of business situated, for tax purposes,
in Switzerland, will be subject to Swiss federal, cantonal and communal individual or corporate income tax, as the case may be.
This also applies to Swiss resident individuals who, for individual income tax purposes, are deemed to be professional securities
dealers for reasons of, inter alia, frequent dealing and debt-financed purchases. Capital gains realized by resident individuals
who hold the common shares as business assets might be entitled to reductions or partial taxations similar to those mentioned
above for dividends (Teilbesteuerung) if certain conditions are met (e.g. holding period of at least one year and participation
of at least 10% of nominal share capital of the Company).


 


Swiss resident
corporate taxpayers as well as non-Swiss resident corporate taxpayers holding the common shares or warrants in connection with
the conduct of a trade or business, through a permanent establishment or fixed place of business situated, for tax purposes, in
Switzerland, are required to recognize such capital gain in their income statements for the relevant tax period. Corporate taxpayers
may qualify for participation relief on capital gains (Beteiligungsabzug), if the common shares sold during the tax period
represent at least 10% of the Company’s share capital or if the common shares sold give entitlement to at least 10% of the
Company’s profit and reserve and were held for at least one year. The tax relief applies to the difference between the sale
proceeds of common shares by the Company and the acquisition costs of the participation (Gestehungskosten).


 


Individuals
and corporations not resident in Switzerland for tax purposes and not holding the common shares or warrants in connection with
the conduct of a trade or business in Switzerland through a permanent establishment or fixed place of business situated, for tax
purposes, in Switzerland, are not subject to Swiss federal, cantonal and communal individual income or corporate income tax, as
the case may be, on capital gains realized on the sale of the common shares or warrants.


 


Gift and
Inheritance Tax


 


Transfers
of common shares or warrants may be subject to cantonal and/or communal inheritance or gift taxes if the deceased or the donor
or the recipient were resident in a Canton levying such taxes and, in international circumstances where residency requirements
are satisfied, if the applicable tax treaty were to allocate the right to tax to Switzerland.


 


Swiss
Issuance Stamp Duty


 


The Company
is subject to paying to the Swiss Federal Tax Administration a 1% Swiss federal issuance stamp tax (Emissionsabgabe) on
any increase of the nominal share capital of the Company (with or without issuance of shares) or any other equity contributions
received by the Company (regardless of whether or not any compensation is paid to the shareholder in connection with the contribution).
Certain costs incurred in connection with the issuance


 






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of
shares (if any) may be deductible. There are several exemptions from issuance stamp tax that may apply under certain circumstances
(e.g., certain intercompany reorganizations).


 


Swiss Securities Transfer
Tax


 


The purchase
or sale (or other financial transfer) of the common shares, whether by Swiss residents or non-Swiss residents, may be subject
to Swiss securities transfer tax of up to 0.15%, calculated on the purchase price or the proceeds if the purchase or sale occurs
through or with a Swiss bank or other Swiss securities dealer as defined in the Swiss Federal Stamp Duty Act as an intermediary
or party to the transaction unless an exemption applies.


 


Material
U.S. Federal Income Tax Considerations for U.S. Holders


 


The following
is a description of the material U.S. federal income tax consequences to U.S. Holders described below of owning and disposing
of common shares or warrants, but it does not purport to be a comprehensive description of all tax considerations that may be
relevant to a particular person’s decision to acquire the warrants. This discussion applies only to a U.S. Holder that holds
the common shares or warrants as capital assets for U.S. federal income tax purposes. In addition, it does not describe all of
the tax consequences that may be relevant in light of a U.S. Holder’s particular circumstances, including alternative minimum
tax consequences, the potential application of the provisions of the Internal Revenue Code of 1986, as amended, or the Code, known
as the Medicare contribution tax and tax consequences applicable to U.S. Holders subject to special rules, such as:


 


		·	certain
                                         financial institutions;



 


		·	dealers
                                         or traders in securities who use a mark-to-market method of tax accounting;



 


		·	persons
                                         holding common shares or warrants as part of a straddle, wash sale, or conversion transaction
                                         or persons entering into a constructive sale with respect to the common shares;



 


		·	persons
                                         whose functional currency for U.S. federal income tax purposes is not the U.S. dollar;



 


		·	entities
                                         classified as partnerships for U.S. federal income tax purposes;



 


		·	tax-exempt
                                         entities, including an “individual retirement account” or “Roth IRA”;



 


		·	persons
                                         that own or are deemed to own ten percent or more of the vote or value of our stock;
                                         or



 


		·	persons
                                         holding shares or warrants in connection with a trade or business conducted outside of
                                         the United States.



 


If an entity
that is classified as a partnership for U.S. federal income tax purposes holds common shares or warrants, the U.S. federal income
tax treatment of a partner will generally depend on the status of the partner and the activities of the partnership. Partnerships
holding common shares or warrants and partners in such partnerships should consult their tax advisers as to their particular U.S.
federal income tax consequences of holding and disposing of the common shares or warrants.


 


This discussion
is based on the Code, administrative pronouncements, judicial decisions, final, temporary and proposed Treasury regulations, and
the income tax treaty between Switzerland and the United States, or the Treaty, all as of the date hereof, any of which is subject
to change, possibly with retroactive effect.


 


A “U.S.
Holder” is a holder who, for U.S. federal income tax purposes, is a beneficial owner of common shares who is eligible for
the benefits of the Treaty and is:


 


		·	an
                                         individual who is a citizen or resident of the United States;



 


		·	a
                                         corporation, or other entity taxable as a corporation, created or organized in or under
                                         the laws of the United States, any state therein or the District of Columbia; or



 


		·	an
                                         estate or trust the income of which is subject to U.S. federal income taxation regardless
                                         of its source.



 






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U.S. Holders
should consult their tax advisers concerning the U.S. federal, state, local and non-U.S. tax consequences of owning and disposing
of common shares or warrants in their particular circumstances.


 


Passive
Foreign Investment Company Rules


 


We believe
that we were a “passive foreign investment company,” or PFIC, for U.S. federal income tax purposes for our 2017 taxable
year, and we expect to be a PFIC for our current taxable year and for the foreseeable future. In addition, we may, directly or
indirectly, hold equity interests in other PFICs, or Lower-tier PFICs. In general, a non-U.S. corporation will be considered a
PFIC for any taxable year in which (i) 75% or more of its gross income consists of passive income or (ii) 50% or more of the average
quarterly value of its assets consists of assets that produce, or are held for the production of, passive income. For purposes
of the above calculations, a non-U.S. corporation that directly or indirectly owns at least 25% by value of the shares of another
corporation is treated as if it held its proportionate share of the assets of the other corporation and received directly its
proportionate share of the income of the other corporation. Passive income generally includes dividends, interest, rents, royalties
and capital gains.


 


Under attribution
rules, assuming we are a PFIC, U.S. Holders will be deemed to own their proportionate shares of Lower-tier PFICs and will be subject
to U.S. federal income tax according to the rules described in the following paragraphs on (i) certain distributions by a Lower-tier
PFIC and (ii) a disposition of shares of a Lower-tier PFIC, in each case as if the U.S. Holder held such shares directly, even
if the U.S. Holder has not received the proceeds of those distributions or dispositions.


 


If we are
a PFIC for any taxable year during which a U.S. Holder holds our shares or warrants, the U.S. Holder may be subject to certain
adverse tax consequences. Unless a U.S. Holder makes a timely “mark-to-market” election or “qualified electing
fund” election, each as discussed below, gain recognized on a disposition (including, under certain circumstances, a pledge)
of common shares or warrants by the U.S. Holder, or on an indirect disposition of shares of a Lower-tier PFIC, will be allocated
ratably over the U.S. Holder’s holding period for the shares or warrants. The amounts allocated to the taxable year of disposition
and to years before we became a PFIC, if any, will be taxed as ordinary income. The amounts allocated to each other taxable year
will be subject to tax at the highest rate in effect for that taxable year for individuals or corporations, as appropriate, and
an interest charge will be imposed on the tax attributable to the allocated amounts. Further, to the extent that any distribution
received by a U.S. Holder on our common shares (or a distribution by a Lower-tier PFIC to its shareholder that is deemed to be
received by a U.S. Holder) exceeds 125% of the average of the annual distributions on the shares received during the preceding
three years or the U.S. Holder’s holding period, whichever is shorter, the distribution will be subject to taxation in the
same manner as gain, described immediately above.


 


If we are
a PFIC for any year during which a U.S. Holder holds common shares or warrants, we generally will continue to be treated as a
PFIC with respect to the U.S. Holder for all succeeding years during which the U.S. Holder holds common shares or warrants, even
if we cease to meet the threshold requirements for PFIC status. U.S. Holders should consult their tax advisers regarding the potential
availability of a “deemed sale” election that would allow them to eliminate this continuing PFIC status under certain
circumstances.


 


Under proposed
Treasury regulations, which have yet to be finalized, a U.S. Holder of our warrants will be taxed in a manner similar to a U.S.
Holder of our common shares if the U.S. Holder realizes gain on the sale of the warrants. Moreover, if a U.S. Holder of our warrants
exercises the warrants to purchase common shares, the holding period over which any income realized upon a sale or other disposition,
will be allocated will include the holding period of the warrants. Furthermore, if we are a PFIC, a U.S. Holder of our warrants
will be treated as a holder of PFIC stock taxable under the ordinary income allocation and interest charge regime described above.


 


If our common
shares are “regularly traded” on a “qualified exchange,” a U.S. Holder may make a mark-to-market election
with respect to the shares that would result in tax treatment different from the general tax treatment for PFICs described above.
Our common shares will be treated as “regularly traded” in any calendar year in which more than a de minimis
quantity of the common shares is traded on a qualified exchange on at least 15 days during each calendar quarter. NASDAQ, on which
the common shares are listed, is a qualified exchange for this purpose. U.S. Holders should consult their tax advisers regarding
the availability and advisability of making a mark-


 






    49 


     


    

 


to-market
election in their particular circumstances. In particular, U.S. Holders should consider carefully the impact of a mark-to-market
election with respect to their common shares given that we may have Lower-tier PFICs for which a mark-to-market election may not
be available. In addition, U.S. Holders should note that the warrants are not likely to be treated as regularly traded on a qualified
exchange.


 


If a U.S.
Holder makes the mark-to-market election, the U.S. Holder generally will recognize as ordinary income any excess of the fair market
value of the common shares at the end of each taxable year over their adjusted tax basis, and will recognize an ordinary loss
in respect of any excess of the adjusted tax basis of the common shares over their fair market value at the end of the taxable
year (but only to the extent of the net amount of income previously included as a result of the mark-to-market election). If a
U.S. Holder makes the election, the U.S. Holder’s tax basis in the common shares will be adjusted to reflect the income
or loss amounts recognized. Any gain recognized on a sale or other disposition of common shares in a year in which we are a PFIC
will be treated as ordinary income and any loss will be treated as an ordinary loss (but only to the extent of the net amount
of income previously included as a result of the mark-to-market election). Distributions paid on common shares will be treated
as discussed below under “Taxation of Distributions.”


 


Alternatively,
a U.S. Holder can make an election, if we provide the necessary information, to treat us and each Lower-tier PFIC as a qualified
electing fund (a “QEF Election”) in the first taxable year that we are treated as a PFIC with respect to the U.S.
Holder. A U.S. Holder must make the QEF Election for each PFIC by attaching a separate properly completed IRS Form 8621 for each
PFIC to its timely filed U.S. federal income tax return. Upon request of a U.S. Holder, we will provide the information necessary
for a U.S. Holder to make a QEF Election with respect to us and will use commercially reasonable efforts to cause each Lower-tier
PFIC that we control to provide such information with respect to such Lower-tier PFIC. However, no assurance can be given that
such QEF information will be available for any Lower-tier PFIC.


 


If a U.S.
Holder makes a QEF Election with respect to a PFIC, the U.S. Holder will be currently taxable on its pro rata share of
the PFIC’s ordinary earnings and net capital gain (at ordinary income and capital gain rates, respectively) for each taxable
year that the entity is classified as a PFIC. If a U.S. Holder makes a QEF Election with respect to us, any distributions paid
by us out of our earnings and profits that were previously included in the U.S. Holder’s income under the QEF Election will
not be taxable to the U.S. Holder. A U.S. Holder will increase its tax basis in its common shares by an amount equal to any income
included under the QEF Election and will decrease its tax basis by any amount distributed on the common shares that is not included
in its income. In addition, a U.S. Holder will recognize capital gain or loss on the disposition of common shares in an amount
equal to the difference between the amount realized and its adjusted tax basis in the common shares. U.S. Holders should note
that if they make QEF Elections with respect to us and Lower-tier PFICs, they may be required to pay U.S. federal income tax with
respect to their common shares for any taxable year significantly in excess of any cash distributions received on the shares for
such taxable year. U.S. Holders should note that a QEF election cannot be made with respect to our warrants. U.S. Holders should
consult their tax advisers regarding making QEF Elections in their particular circumstances.


 


Furthermore,
if with respect to a particular U.S. Holder we are treated as a PFIC for the taxable year in which we paid a dividend or the prior
taxable year, the preferential dividend rate with respect to dividends paid to certain non-corporate U.S. Holders will not apply.


 


If we are
a PFIC for any taxable year during which a U.S. Holder holds common shares, such U.S. Holder will be required to file an annual
information report with such U.S. Holder’s U.S. Federal income tax return on IRS Form 8621.


 


U.S. Holders
should consult their tax advisers concerning our PFIC status and the tax considerations relevant to an investment in a PFIC.


 


Taxation
of Distributions on Common Shares


 


As discussed
above under “Dividend Policy,” we do not currently expect to make distributions on our common shares. In the event
that we do make distributions of cash or other property, subject to the PFIC rules described above, distributions paid on common
shares, other than certain pro rata distributions of common shares, will be treated as dividends to the extent paid out
of our current or accumulated earnings and profits (as determined under U.S. federal income tax principles). The amount of a dividend
will include any amounts withheld by us in respect of Swiss taxes. The U.S. dollar amount of any dividend will be treated as foreign-source
dividend income to U.S.


 






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Holders
and will not be eligible for the dividends-received deduction generally available to U.S. corporations under the Code. Dividends
will be included in a U.S. Holder’s income on the date of the U.S. Holder’s receipt of the dividend. The amount of
any dividend income paid in Swiss Francs will be the U.S. dollar amount calculated by reference to the exchange rate in effect
on the date of receipt, regardless of whether the payment is in fact converted into U.S. dollars. If the dividend is converted
into U.S. dollars on the date of receipt, a U.S. Holder should not be required to recognize foreign currency gain or loss in respect
of the dividend income. A U.S. Holder may have foreign currency gain or loss if the dividend is converted into U.S. dollars after
the date of receipt.


 


Subject
to applicable limitations, some of which vary depending upon the U.S. Holder’s circumstances, Swiss income taxes withheld
from dividends on common shares at a rate not exceeding the rate provided by the Treaty may be creditable against the U.S. Holder’s
U.S. federal income tax liability. Swiss taxes withheld in excess of the rate applicable under the Treaty will not be eligible
for credit against a U.S. Holder’s federal income tax liability. The rules governing foreign tax credits are complex, and
U.S. Holders should consult their tax advisers regarding the creditability of foreign taxes in their particular circumstances.
In lieu of claiming a foreign tax credit, U.S. Holders may, at their election, deduct foreign taxes, including the Swiss withholding
tax, in computing their taxable income, subject to generally applicable limitations under U.S. law. An election to deduct foreign
taxes instead of claiming foreign tax credits applies to all foreign taxes paid or accrued in the taxable year.


 


Constructive
Dividends on Warrants


 


As discussed
above under “Dividend Policy,” we do not currently expect to make distributions on our common shares. Subject to the
PFIC rules described above, if at any time during the period in which a U.S. Holder held our warrants we were to pay a taxable
dividend to our shareholders and, in accordance with the anti-dilution provisions of the warrants, the exercise price of the warrants
were decreased, that decrease would be deemed to be the payment of a taxable dividend to a U.S. Holder of the warrants to the
extent of our earnings and profits, notwithstanding the fact that the U.S. Holder will not receive a cash payment. If the exercise
price is adjusted in certain other circumstances (or in certain circumstances, there is a failure to make adjustments), that adjustment
may also result in the deemed payment of a taxable dividend to a U.S. Holder. U.S. Holders should consult their tax advisors regarding
the proper treatment of any adjustments to the warrants and the interaction between these adjustments and the PFIC rules.


 


Sale or
Other Disposition, Exercise or Expiration of Warrants


 


Subject
to the PFIC rules described above, for U.S. federal income tax purposes, gain or loss realized on the sale or other disposition
of a warrant (other than by exercise) will be capital gain or loss and will be long-term capital gain or loss if the U.S. Holder
held the warrant for more than one year at the time of the sale or other disposition. The amount of the gain or loss will equal
the difference between the U.S. Holder’s tax basis in the warrants disposed of and the amount realized on the disposition,
in each case as determined in U.S. dollars. For purposes of determining their basis in common shares and warrants purchased, U.S.
Holders should allocate their purchase price between the common shares and warrants on the basis of their relative fair market
value at the time of issuance. This gain or loss will generally be U.S.-source gain or loss for foreign tax credit purposes.


 


In general,
a U.S. Holder will not be required to recognize income, gain or loss upon the exercise of a warrant by payment of the exercise
price. A U.S. Holder’s basis in a share of common stock received upon exercise will be equal to the sum of (1) the U.S.
Holder’s basis in the warrant and (2) the exercise price of the warrant. Subject to the PFIC rules described above, a U.S.
Holder’s holding period in the share received upon exercise will commence on the day after such U.S. Holder exercises the
warrants. Although there is no direct legal authority as to the U.S. federal income tax treatment of an exercise of a warrant
on a cashless basis, we intend to take the position that such exercise will not be taxable, either because the exercise is not
a gain realization event or because it qualifies as a tax-free recapitalization. In the former case, the holding period of the
common shares would commence on the day after the warrant is exercised. In the latter case, the holding period of the common shares
would include the holding period of the exercised warrants. However, our position is not binding on the IRS and the IRS may treat
a cashless exercise of a warrant as a taxable exchange. U.S. Holders are urged to consult their tax advisors as to the consequences
of an exercise of a warrant on a cashless basis.


 


If a warrant
expires without being exercised, a U.S. Holder will recognize a capital loss in an amount equal to such U.S. Holder’s basis
in the warrant. This loss will be long-term capital loss if, at the time of the expiration, the


 






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U.S.
Holder’s holding period in the warrant is more than one year. The deductibility of capital losses is subject to limitations.


 


Sale or
Other Disposition of Common Shares


 


Subject
to the PFIC rules described above, for U.S. federal income tax purposes, gain or loss realized on the sale or other disposition
of common shares will be capital gain or loss, and will be long-term capital gain or loss if the U.S. Holder held the common shares
for more than one year. The amount of the gain or loss will equal the difference between the U.S. Holder’s tax basis in
the common shares disposed of (as described above) and the amount realized on the disposition, in each case as determined in U.S.
dollars. This gain or loss will generally be U.S.-source gain or loss for foreign tax credit purposes.


 


Information
Reporting and Backup Withholding


 


Payments
of dividends (including constructive dividends) and sales proceeds that are made within the United States or through certain U.S.-related
financial intermediaries generally are subject to information reporting, and may be subject to backup withholding, unless (i)
the U.S. Holder is a corporation or other exempt recipient or (ii) in the case of backup withholding, the U.S. Holder provides
a correct taxpayer identification number and certifies that it is not subject to backup withholding.


 


The amount
of any backup withholding from a payment to a U.S. Holder will be allowed as a credit against the holder’s U.S. federal
income tax liability and may entitle it to a refund, provided that the required information is timely furnished to the IRS.


 


Information
With Respect to Foreign Financial Assets


 


Certain U.S. Holders who are
individuals and certain entities may be required to report information relating to an interest in our common shares, subject to
certain exceptions (including an exception for common shares held in accounts maintained by certain U.S. financial institutions).
U.S. Holders should consult their tax advisers regarding the effect, if any, of this legislation on their ownership and disposition
of the common shares.


 




    	 



    	 



    

 


Annex
C


 


Subscription
Form


 


Zeichnungsschein


 


Subscription
Form


 


_____________________________________________________________________


 


Die Unterzeichnende


 


The undersigned 


 


[Name,
Address]


 


handelnd im eigenen Namen,



acting in its own name,


 


hat Kenntnis
genommen:


 


takes
note of:


 


(i) vom
Emissionsprospekts vom 15. September 2015 sowie der Ergänzung vom [Datum],
(ii) von den Statuten von Auris Medical Holding AG, Zug (die Gesellschaft) vom [23.
Januar 2018], (iii) vom Generalversammlungsbeschluss der Gesellschaft vom 13 April 2017 betreffend die Ermächtigung
des Verwaltungsrates der Gesellschaft, das Aktienkapital jederzeit bis zum 13. April 2019 im Maximalbetrag von CHF 8‘860‘000.00
durch Ausgabe von höchstens 22‘150‘000 vollständig zu liberierenden Namenaktien mit einem Nennwert von je
CHF 0.40 zu erhöhen, und (iv) vom Beschluss des Verwaltungsrates der Gesellschaft vom [Datum],
wonach gestützt auf Artikel 3a der Statuten über das genehmigte Kapital beschlossen wurde, das Aktienkapital in
einem oder mehreren Schritten von CHF [19‘349‘556.00] um maximal
CHF [7‘242‘325.60] auf maximal CHF [26‘591‘881.60]
durch Ausgabe von maximal [18,105,814] neuen Namenaktien mit einem Nominalwert von
CHF 040 zu erhöhen, zu einem Ausgabebetrag von CHF 0.40 pro Aktie, d.h. insgesamt um maximal CHF [7‘242‘325.60];


 


(i) the
offering prospectus dated September 10, 2015 as well as the prospectus supplement dated on or around [date],
(ii) the articles of association of Auris Medical Holding AG, Zug (the Company), dated [January
23, 2018], (iii) the resolution of the general meeting of shareholders of the Company, dated April 13, 2017, authorizing
the Board of Directors of the Company to increase, the share capital at any time until April 13, 2019, by a maximum amount of
CHF 8,860’000.00 by issuing a maximum of 22,150,000 fully paid-up shares with a par value of CHF 0.40 each, and
(iv) the resolution of the Board of Directors of the Company, dated [date], pursuant
to which the share capital is to be increased, in one or in more steps from CHF [19‘349‘556.00]
by a maximum of CHF [7,242,325.60] to a maximum of CHF [26,591,881.60]
by issuing a maximum of [18,105,814] new registered shares with a par value of CHF
0.40 each, at the issue amount of CHF 0.40 per share, i.e., for an aggregate issue amount of up to CHF [7,242,325.60];


 






    52 


     


    

 


und / and


 


		1	zeichnet
                                         hiermit [Anzahl] neue Namenaktien zum Nominalwert
                                         von je CHF 0.40; und 



 


hereby subscribes
for [amount] new registered shares with a par value of CHF 0.40 each; and






 


		2	verpflichtet
sich hiermit bedingungslos, auf jede gezeichnete Aktie i) eine Einlage von CHF 0.40, insgesamt somit CHF [Betrag],
auf das Kapitaleinzahlungskonto bei der   [XXXXXXXXXX]  (IBAN [XXXXXXXXXX];
Kontonummer [XXXXXXXXXX]; BIC: [XXXXXXXXXX]; Konto lautend auf: [XXXXXXXXXX] sowie ii) ein zusätzlich vereinbartes
Agio, auf das selbe Konto, zu leisten.



 


herewith
unconditionally undertakes to pay-in the (i) contribution of CHF 0.40 for each subscribed share, thus in total CHF [amount],
to the capital increase account with 
[XXXXXXXXXX]; bank account number [XXXXXXXXXX]; BIC: [XXXXXXXXXX]; account in the name of: [XXXXXXXXXX] and ii) a separately
agreed capital surplus (agio) to the same bank account.


 




Dieser Zeichnungsschein ist gültig bis zum 30. April 2018.


 


This
subscription form is valid until 30. April 2018. 


 


[Unterschriften
auf der nächsten Seite]


 


[Signatures
on next page]


 




    	 



    	 



    

 


[Place],
_____________________ 2018


 


Name


 








 


	Name:
    	 	Name:




 


 


 






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