Exhibit 10.46


 


SECURITIES PURCHASE AGREEMENT


 


This Securities Purchase
Agreement (this “Agreement”) is dated as of ______________, 2016, between Bellerophon Therapeutics, Inc., a
Delaware corporation (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 an effective registration statement under the Securities Act
of 1933, as amended (the “Securities Act”), the Company desires to issue and sell to each Purchaser, and each
Purchaser, severally and not jointly, desires to purchase 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: (a) capitalized terms that are not otherwise defined herein have the
meanings given to such terms in the Certificate of Designation (as defined herein), and (b) 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 4.7.


 


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


 


“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.  


 


“Beneficial
Ownership Limitation” shall have the meaning ascribed to such term in Section 2.1.


 


“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
any day on which banking institutions in the State of New York are authorized or required by law or other governmental action to
close.


 


“Certificate
of Designation” means the Certificate of Designation to be filed prior to the Closing by the Company with the Secretary
of State of the State of Delaware, in the form of Exhibit A attached hereto.


 




     


     


    

 


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


 


“Closing
Date” means the Trading Day on which all of the Transaction Documents have been executed and delivered by the applicable
parties thereto, and all conditions precedent to (i) the Purchasers’ obligations to pay the Subscription Amount and (ii)
the Company’s obligations to deliver the Securities, in each case, have been satisfied or waived, but in no event later than
the third Trading Day following the date hereof.


 


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


 


“Common
Stock” means the common stock of the Company, par value $0.01 per share, and any other class of securities into which
such securities may hereafter be reclassified or changed.


 


“Common
Stock Equivalents” means any securities of the Company or the Subsidiaries which would entitle the holder thereof to
acquire at any time Common Stock, 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
Stock.


 


“Company
Counsel” means Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C., with offices located at 666 Third Avenue, New York,
New York 10017.


 


“Conversion
Price” shall have the meaning ascribed to such term in the Certificate of Designation.


 


“Conversion
Shares” means, collectively, the shares of Common Stock issuable upon conversion of the shares of Preferred Stock.


 


“Disclosure
Schedules” means the Disclosure Schedules of the Company delivered concurrently herewith.


 


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


 


“Evaluation
Date” shall have the meaning ascribed to such term in Section 3.1(r).


 


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


 


“Exempt
Issuance” means the issuance of (a) shares of Common Stock or options to employees, officers, directors or other service
providers of the Company pursuant to any stock or option plan duly adopted for such purpose, by a majority of the non-employee
members of the Board of Directors or a majority of the members of a committee of non-employee directors established for such purpose
for services rendered


 




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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 shares of Common Stock issued and outstanding on the date of this Agreement, provided that such securities
have not been amended since the date of this 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 stock splits or combinations) and (c) securities
issued pursuant to acquisitions or strategic transactions approved by a majority of the disinterested directors of the Company,
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.


 


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


 


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


 


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


 


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


 


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


 


“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(b).


 


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


 


“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.


 


“Pharmaceutical
Product” shall have the meaning ascribed to such term in Section 3.1(gg).


 


“Placement
Agent” means H.C. Wainwright & Co., LLC.


 


“Preferred
Stock” means the up to _____ shares of the Company’s Series A Convertible Preferred Stock issued hereunder having
the rights, preferences and privileges set forth in the Certificate of Designation, in the form of Exhibit A hereto.


 




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“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 final prospectus filed for the Registration Statement.


 


“Public
Information Failure” shall have the meaning ascribed to such term in Section 4.3(b).


 


“Public
Information Failure Payments” shall have the meaning ascribed to such term in Section 4.3(b).


 


“Purchaser
Party” shall have the meaning ascribed to such term in Section 4.10.


 


“Registration
Statement” means the effective registration statement filed with the Commission (file No. 333-214230) which registers
the sale of the Securities.


 


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


 


“Required
Minimum” means, as of any date, the maximum aggregate number of shares of Common Stock then issued or potentially issuable
in the future pursuant to the Transaction Documents, including the Shares and any Underlying Shares issuable upon exercise in full
of all Warrants or conversion in full of all shares of Preferred Stock, ignoring any conversion or exercise limits set forth therein.


 


“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 have the meaning ascribed to such term in Section 3.1(h).


 


“Securities”
means the Preferred Stock, the Shares, the Warrants, the Warrant Shares and the Conversion Shares.


 


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


 


“Shares”
has the meaning set forth in Section 2.1.


 


“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 the location and/or


 




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reservation
of borrowable shares of Common Stock). 


 


“Stated
Value” means $1,000 per share of Preferred Stock.


 


“Subscription
Amount”  shall mean, as to each Purchaser, the aggregate amount to be paid for the Shares, Preferred Stock,
as applicable to such Purchaser, 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 United States dollars and in immediately available
funds.


 


“Subsidiary”
means any subsidiary of the Company as set forth in the SEC Reports and shall, where applicable, also include any direct or indirect
subsidiary of the Company formed or acquired after the date hereof.


 


“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 Stock is listed or quoted for trading on
the date in question: the NYSE MKT, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the New
York Stock Exchange or OTCQB or OTCQX (or any successors to any of the foregoing).


 


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


 


“Transfer
Agent” means Computershare Trust Company, N.A., the current transfer agent of the Company, with a mailing address of
1290 Avenue of the Americas, 9th Floor, New York, New York 10104, and any successor transfer agent of the Company.


 


“Underlying
Shares” means the Conversion Shares and the Warrant Shares.


 


“Variable
Rate Transaction” shall have the meaning ascribed to such term in Section 4.13(b).


 


“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then listed
or quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest preceding
date) on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based on a Trading
Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b)  if OTCQB or OTCQX is not a Trading Market,
the volume weighted average price of the Common Stock for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable,
(c) if the Common Stock is not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Common Stock are then
reported in the “Pink Sheets” published by OTC Markets Group, Inc. (or a similar organization or agency succeeding
to its functions of


 




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reporting prices), the most recent
bid price per share of the Common Stock so reported, or (d) in all other cases, the fair market value of a share of Common
Stock as determined by an independent appraiser selected in good faith by the 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 Stock purchase warrants delivered to the Purchasers at the Closing in accordance with Section 2.2(a)
hereof, which Warrants shall be exercisable immediately and terminate on the five (5) year anniversary of the Closing Date, in
the form of Exhibit B attached hereto.


 


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


 


ARTICLE II.


PURCHASE AND SALE


 


2.1       Closing.  On
the Closing Date, upon the terms and subject to the conditions set forth herein, substantially concurrent with the execution and
delivery of this Agreement by the parties hereto, the Company agrees to sell, and the Purchasers, severally and not jointly, agree
to purchase, up to an aggregate of $____________ of shares of Common Stock (the “Shares”) and Warrants as determined
pursuant to Section 2.2(a); provided, however, that, to the extent a Purchaser determines, in its sole discretion, that such Purchaser
(together with such Purchaser’s Affiliates, and any Person acting as a group together with such Purchaser or any of its  Affiliates)
would beneficially own in excess of the Beneficial Ownership Limitation, in lieu of purchasing Shares, such Purchaser may elect
to purchase the Preferred Stock at the Stated Value. The “Beneficial Ownership Limitation” shall be 4.99% of the number
of shares of the Common Stock outstanding immediately after giving effect to the issuance of the Securities on the Closing Date.    Each
Purchaser shall deliver to the Company, via wire transfer, immediately available funds equal to its Subscription Amount, and the
Company shall deliver to each Purchaser its respective Shares or Preferred Stock (as applicable to such Purchaser) and Warrants,
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.  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. The Company covenants
that, if the Purchaser delivers a Notice of Conversion (as defined in the Certificate of Designation) no later than 12 noon Eastern
Standard Time on the Trading Day immediately prior to the scheduled Closing Date to convert any shares of Preferred Stock between
the date hereof and the Closing Date, the Company shall deliver Conversion Shares to the Purchaser on the Closing Date in connection
with such Notice of Conversion.


 


Each Purchaser acknowledges
that concurrently with the Closing and pursuant to the Prospectus, the Company may sell additional shares of Common Stock and Warrants
to purchasers not party to this Purchase Agreement and will issue to each such purchaser’s broker-dealer such additional
shares of Common Stock and Warrants in the same form and amount per share of Common Stock and Warrants at the same price as issued
to a Purchaser hereunder.


 




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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 Company Counsel, substantially in the form of Exhibit D attached hereto;


 


(iii)        for
each Purchaser, as applicable, a certificate evidencing a number of shares of Preferred Stock equal to such Purchaser’s Subscription
Amount divided by the Stated Value, registered in the name of such Purchaser and evidence of the filing and acceptance of the Certificate
of Designation from the Secretary of State of the State of Delaware;


 


(iv)        a
Warrant registered in the name of such Purchaser to purchase up to a number of shares of Common Stock equal to []% of such
Purchaser’s Conversion Shares, with an exercise price equal to $____, subject to adjustment
therein (such Warrant certificate may be delivered within three Trading Days of the Closing Date); 


 


(v)         the
Company shall have provided each Purchaser with the Company’s wire instructions, on Company letterhead and executed by the
Chief Executive Officer or Chief Financial Officer; and


 


(vi)        the
Prospectus (which may be delivered in accordance with Rule 172 under the Securities Act)


 


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


 


(i)          this
Agreement duly executed by such Purchaser; and


 


(ii)         to
the Company, such Purchaser’s Subscription Amount by wire transfer to the account specified by the Company.


 


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 on the Closing Date of the representations and warranties of the Purchasers 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 each Purchaser required to be performed at or prior to the Closing Date shall have
been performed;


 




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


 


(iv)        the
Certificate of Designation shall have been filed and be effective in the State of Delaware.


 


(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 when made and on the Closing Date of the representations 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;


 


(v)         the
Certificate of Designation shall have been filed and be effective in the State of Delaware; and


 


(vi)        from
the date hereof to the Closing Date, trading in the Common Stock 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.


 


ARTICLE III.


REPRESENTATIONS AND WARRANTIES


 


3.1       Representations
and Warranties of the Company.  Except as set forth in the SEC Reports and the Disclosure Schedules, which SEC Reports
and Disclosure Schedules shall be deemed a part hereof and shall qualify any representation or otherwise made herein to the extent


 




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of the disclosure contained in the corresponding
section of the Disclosure Schedules, the Company hereby makes the following representations and warranties to each Purchaser:


 


(a)        Subsidiaries.  All
of the direct and indirect subsidiaries of the Company are set forth on Schedule 3.1(a).  The Company owns, directly
or indirectly, all of the capital stock or other equity interests of each Subsidiary free and clear of any Liens, and all of the
issued and outstanding shares of capital stock of each Subsidiary are validly issued and are fully paid, non-assessable and free
of preemptive and similar rights to subscribe for or purchase securities.  If the Company has no subsidiaries, all other
references to the Subsidiaries or any of them in the Transaction Documents shall be disregarded.


 


(b)        Organization
and Qualification.  The Company and each of its Subsidiaries is an entity duly incorporated or otherwise organized,
validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization, with the requisite
power and authority to own and use its properties and assets and to carry on its business as currently conducted.  Neither
the Company nor any Subsidiary is in violation nor default of any of the provisions of its respective certificate or articles of
incorporation, bylaws or other organizational or charter documents.  Each of the Company and the Subsidiaries is duly
qualified to conduct business and is in good standing as a foreign corporation or other entity in each jurisdiction in which the
nature of the business conducted or property owned by it makes such qualification necessary, except where the failure to be so
qualified or in good standing, as the case may be, would not have or reasonably be expected to result in: (i) a material adverse
effect on the legality, validity or enforceability of any Transaction Document, (ii) a material adverse effect on the results of
operations, assets, business prospects or condition (financial or otherwise) of the Company and the Subsidiaries, taken as a whole,
or (iii) a material adverse effect on the Company’s ability to perform in any material respect on a timely basis its obligations
under any Transaction Document (any of (i), (ii) or (iii), a “Material Adverse Effect”) and no Proceeding has
been instituted in any such jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or curtail such power and
authority or qualification.


 


(c)        Authorization;
Enforcement.  The Company has the requisite corporate power and authority to enter into and to consummate the transactions
contemplated by this Agreement and each of the other Transaction Documents and otherwise to carry out its obligations hereunder
and thereunder.  The execution and delivery of this Agreement and each of the other Transaction Documents by the Company
and the consummation by it of the transactions contemplated hereby and thereby have been duly authorized by all necessary action
on the part of the Company and no further action is required by the Company, the Board of Directors or the Company’s stockholders
in connection herewith or therewith other than in connection with the Required Approvals.  This Agreement and each other
Transaction Document to which it is a party has been (or upon delivery will have been) duly executed by the Company and, when delivered
in accordance with the terms hereof and thereof, will constitute the valid and binding obligation of the Company enforceable against
the Company in accordance with its terms, except: (i) as limited by general equitable principles and applicable bankruptcy, insolvency,
reorganization,


 




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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


 


(d)        No
Conflicts.  The execution, delivery and performance by the Company of this Agreement and the other Transaction Documents
to which it is a party, the issuance and sale of the Securities and the consummation by it of the transactions contemplated hereby
and thereby do not and will not: (i) conflict with or violate any provision of the Company’s or any Subsidiary’s certificate
or articles of incorporation, bylaws or other organizational or charter documents, (ii) conflict with, or constitute a default
(or an event that with notice or lapse of time or both would become a default) under, result in the creation of any Lien upon any
of the properties or assets of the Company or any Subsidiary, or give to others any rights of termination, amendment, acceleration
or cancellation (with or without notice, lapse of time or both) of, any agreement, credit facility, debt or other instrument (evidencing
a Company or Subsidiary debt or otherwise) or other understanding to which the Company or any Subsidiary is a party or by which
any property or asset of the Company or any Subsidiary is bound or affected, or (iii) subject to the Required Approvals, conflict
with or result in a violation of any law, rule, regulation, order, judgment, injunction, decree or other restriction of any court
or governmental authority to which the Company or a Subsidiary is subject (including federal and state securities laws and regulations),
or by which any property or asset of the Company or a Subsidiary is bound or affected; except in the case of each of clauses (ii)
and (iii), such as would not have or reasonably be expected to result in a Material Adverse Effect.


 


(e)        Filings,
Consents and Approvals.  The Company is not required to obtain any consent, waiver, authorization or order of, give
any notice to, or make any filing or registration with, any court or other federal, state, local or other governmental authority
or other Person in connection with the execution, delivery and performance by the Company of the Transaction Documents, other than:
(i) the consents or waivers set forth on Schedule 3.1(e), (ii) the filings required pursuant to Section 4.6 of this Agreement,
(iii) the filing with the Commission of the Prospectus, (iv) the notice and/or application(s) to each applicable Trading Market
for the issuance and sale of the Securities and (v) the filing of the Certificate of Designation with the Secretary of State of
the State of Delaware (collectively, the “Required Approvals”).


 


(f)         Issuance
of the Securities; Registration.  The Securities are duly authorized and, when issued and paid for in accordance
with the applicable Transaction Documents, will be duly and validly issued, fully paid and nonassessable, free and clear of all
Liens imposed by the Company other than restrictions on transfer provided for in the Transaction Documents.  The Underlying
Shares, when issued in accordance with the terms of the Transaction Documents, will be validly issued, fully paid and nonassessable,
free and clear of all Liens imposed by the Company other than restrictions on transfer provided for in the Transaction Documents.  The
Company has reserved from its duly authorized capital stock a number of shares of Common Stock for issuance of the Shares and the
Underlying Shares at least equal to the Required Minimum on the date hereof.


 




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The Company
has prepared and filed the Registration Statement in conformity with the requirements of the Securities Act, which became effective
on [_____________] (the “Effective Date”), including the Prospectus, and such amendments and supplements
thereto as may have been required to the date of this Agreement.  The Registration Statement is effective under the Securities
Act and no stop order preventing or suspending the effectiveness of the Registration Statement or suspending or preventing the
use of the Prospectus has been issued by the Commission and no proceedings for that purpose have been instituted or, to the knowledge
of the Company, are threatened by the Commission.  The Company, if required by the rules and regulations of the Commission,
shall file the Prospectus with the Commission pursuant to Rule 424(b).  At the time the Registration Statement and any
amendments thereto became effective, at the date of this Agreement and at the Closing Date, the Registration Statement and any
amendments thereto conformed and will conform in all material respects to the requirements of the Securities Act and did not and
will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary
to make the statements therein not misleading; and the Prospectus and any amendments or supplements thereto, at time the Prospectus
or any amendment or supplement thereto was issued and at the Closing Date, conformed and will conform in all material respects
to the requirements of the Securities Act and did not and will not contain an untrue statement of a material fact or omit to state
a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not
misleading.


 


(g)        Capitalization.  The
Company has not issued any capital stock since its most recently filed periodic report under the Exchange Act, other than pursuant
to the issuance or exercise of employee stock options under the Company’s stock option plans, the issuance of shares of Common
Stock to employees pursuant to the Company’s employee stock purchase plans and pursuant to the conversion and/or exercise
of Common Stock Equivalents outstanding as of the date of the most recently filed periodic report under the Exchange Act.  Except
as set forth on Schedule 3.1(g), no Person has any right of first refusal, preemptive right, right of participation, or
any similar right to participate in the transactions contemplated by the Transaction Documents.  Except as set forth
on Schedule 3.1(g) and as a result of the purchase and sale of the Securities, there are no outstanding options, warrants,
scrip rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities, rights or obligations
convertible into or exercisable or exchangeable for, or giving any Person any right to subscribe for or acquire any shares of Common
Stock, or contracts, commitments, understandings or arrangements by which the Company or any Subsidiary is or may become bound
to issue additional shares of Common Stock or Common Stock Equivalents. The issuance and sale of the Securities will not obligate
the Company to issue shares of Common Stock or other securities to any Person (other than the Purchasers) and will not result in
a right of any holder of Company securities to adjust the exercise, conversion, exchange or reset price under any of such securities.
All of the outstanding shares of capital stock of the Company are duly authorized, validly issued, fully paid and nonassessable,
have been issued in compliance with all applicable federal and state securities laws, and none of such outstanding shares was issued
in violation of any preemptive rights or similar rights to subscribe for or purchase securities.  No further approval
or authorization of any


 




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stockholder,
the Board of Directors or others is required for the issuance and sale of the Securities.  There are no stockholders
agreements, voting agreements or other similar agreements with respect to the Company’s capital stock to which the Company
is a party or, to the knowledge of the Company, between or among any of the Company’s stockholders.


 


(h)        SEC
Reports; Financial Statements.  The Company has filed 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) (the foregoing materials, including the exhibits thereto and documents incorporated by reference therein, together
with the Prospectus being collectively referred to herein as the “SEC Reports”) on a timely basis or has received
a valid extension of such time of filing and has filed any such SEC Reports prior to the expiration of any such extension.  As
of their respective dates, the SEC Reports complied in all material respects with the requirements of the Securities Act and the
Exchange Act, as applicable, and none of the SEC Reports, when filed, contained any untrue statement of a material fact or omitted
to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.  The financial statements of the Company included in the SEC
Reports comply in all material respects with applicable accounting requirements and the rules and regulations of the Commission
with respect thereto as in effect at the time of filing.  Such financial statements have been prepared in accordance
with United States generally accepted accounting principles applied on a consistent basis during the periods involved (“GAAP”),
except as may be otherwise specified in such financial statements or the notes thereto and except that unaudited financial statements
may not contain all footnotes required by GAAP, and fairly present in all material respects the financial position of the Company
and its consolidated Subsidiaries as of and for the dates thereof and the results of operations and cash flows for the periods
then ended, subject, in the case of unaudited statements, to normal, immaterial, year-end audit adjustments.


 


(i)         Material
Changes; Undisclosed Events, Liabilities or Developments.  Since the date of the latest audited financial statements
included within the SEC Reports, except as specifically disclosed in the Prospectus or a subsequent SEC Report filed prior to the
date hereof: (i) there has been no event, occurrence or development that has had or that would reasonably be expected to result
in a Material Adverse Effect, (ii) the Company has not incurred any liabilities (contingent or otherwise) other than (A) trade
payables and accrued expenses incurred in the ordinary course of business consistent with past practice and (B) liabilities not
required to be reflected in the Company’s financial statements pursuant to GAAP or disclosed in filings made with the Commission,
(iii) the Company has not altered its method of accounting, (iv) the Company has not declared or made any dividend or distribution
of cash or other property to its stockholders or purchased, redeemed or made any agreements to purchase or redeem any shares of
its capital stock and (v) the Company has not issued any equity securities to any officer, director or Affiliate, except pursuant
to existing Company stock option plans. The Company does not have pending before the Commission any request for confidential


 




    12 


     


    

 


treatment of
information.  Except for the issuance of the Securities contemplated by this Agreement and as set forth on Schedule
3.1(i), no event, liability, fact, circumstance, occurrence or development has occurred or exists or is reasonably expected
to occur or exist with respect to the Company or its Subsidiaries or their respective businesses, properties, operations, assets
or financial condition, that would be required to be disclosed by the Company under applicable securities laws at the time this
representation is made or deemed made that has not been publicly disclosed at least  one (1) Trading Day prior to the
date that this representation is made.


 


(j)         Litigation.  Except
as set forth on Schedule 3.1(j), there is no action, suit, inquiry, notice of violation, proceeding or investigation pending
or, to the knowledge of the Company, threatened against or affecting the Company, any Subsidiary or any of their respective properties
before or by any court, arbitrator, governmental or administrative agency or regulatory authority (federal, state, county, local
or foreign) (collectively, an “Action”) which (i) adversely affects or challenges the legality, validity or
enforceability of any of the Transaction Documents or the Securities or (ii) would, if there were an unfavorable decision, have
or reasonably be expected to result in a Material Adverse Effect.  Neither the Company nor any Subsidiary, nor any director
or officer thereof (in his or her capacity as such), is or has been the subject of any Action involving a claim of violation of
or liability under federal or state securities laws or a claim of breach of fiduciary duty.  There has not been, and
to the knowledge of the Company, there is not pending or contemplated, any investigation by the Commission involving the Company
or any current director or officer of the Company (in his or her capacity as such).  The Commission has not issued any
stop order or other order suspending the effectiveness of any registration statement filed by the Company or any Subsidiary under
the Exchange Act or the Securities Act.  


 


(k)        Labor
Relations.  No material labor dispute exists or, to the knowledge of the Company, is imminent with respect to any
of the employees of the Company, which would reasonably be expected to result in a Material Adverse Effect.  None of
the Company’s or its Subsidiaries’ employees is a member of a union that relates to such employee’s relationship
with the Company or such Subsidiary, and neither the Company nor any of its Subsidiaries is a party to a collective bargaining
agreement, and the Company and its Subsidiaries believe that their relationships with their employees are good.  To the
knowledge of the Company, no executive officer of the Company or any Subsidiary is, or is now expected to be, in violation of any
material term of any employment contract, confidentiality, disclosure or proprietary information agreement or non-competition agreement,
or any other contract or agreement or any restrictive covenant in favor of any third party, and, to the Company’s knowledge,
the continued employment of each such executive officer does not subject the Company or any of its Subsidiaries to any liability
with respect to any of the foregoing matters.  The Company and its Subsidiaries are in compliance with all applicable
U.S. federal, state, local and foreign laws and regulations relating to employment and employment practices, terms and conditions
of employment and wages and hours, except where the failure to be in compliance would not, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect.


 




    13 


     


    

 


(l)         Compliance.  Neither
the Company nor any Subsidiary: (i) is in default under or in violation of (and no event has occurred that has not been waived
that, with notice or lapse of time or both, would result in a default by the Company or any Subsidiary under), nor has the Company
or any Subsidiary received notice of a claim that it is in default under or that it is in violation of, any indenture, loan or
credit agreement or any other agreement or instrument to which it is a party or by which it or any of its properties is bound (whether
or not such default or violation has been waived), (ii) is in violation of any judgment, decree or order of any court, arbitrator
or other governmental authority or (iii) is or has been in violation of any statute, rule, ordinance or regulation of any governmental
authority, including without limitation all foreign, federal, state and local laws relating to taxes, environmental protection,
occupational health and safety, product quality and safety and employment and labor matters, except in each case as would not have
or reasonably be expected to result in a Material Adverse Effect.


 


(m)       Regulatory
Permits.  The Company and the Subsidiaries possess all certificates, authorizations and permits issued by the appropriate
federal, state, local or foreign regulatory authorities necessary to conduct their respective businesses as described in the SEC
Reports, except where the failure to possess such permits would not reasonably be expected to result in a Material Adverse Effect
(“Material Permits”), and neither the Company nor any Subsidiary has received any notice of proceedings relating
to the revocation or modification of any Material Permit.


 


(n)        Title
to Assets.  The Company and the Subsidiaries have good and marketable title in fee simple to all real property owned
by them and good and marketable title in all personal property owned by them that is material to the business of the Company and
the Subsidiaries, in each case free and clear of all Liens, except for (i) Liens as do not materially affect the value of such
property and do not materially interfere with the use made and proposed to be made of such property by the Company and the Subsidiaries
and (ii) Liens for the payment of federal, state or other taxes, for which appropriate reserves have been made therefor in accordance
with GAAP and the payment of which is neither delinquent nor subject to penalties.  Any real property and facilities
held under lease by the Company and the Subsidiaries are held by them under valid, subsisting and enforceable leases with which
the Company and the Subsidiaries are in compliance.


 


(o)        Intellectual
Property.  The Company and the Subsidiaries have, or have rights to use, all patents, patent applications, trademarks,
trademark applications, service marks, trade names, trade secrets, inventions, copyrights, licenses and other intellectual property
rights and similar rights as described in the SEC Reports as necessary or required for use in connection with their respective
businesses and which the failure to so have would have a Material Adverse Effect (collectively, the “Intellectual Property
Rights”).  None of, and neither the Company nor any Subsidiary has received a notice (written or otherwise)
that any of, the Intellectual Property Rights has expired, terminated or been abandoned, or is expected to expire or terminate
or be abandoned, within two (2) years from the date of this Agreement.  Neither the Company nor any Subsidiary has received,
since the date of the latest audited financial statements included within the SEC Reports, a written notice of a claim or otherwise
has any knowledge that the Intellectual


 




    14 


     


    

 


Property Rights
violate or infringe upon the rights of any Person, except as would not have or reasonably be expected to not have a Material Adverse
Effect.  To the knowledge of the Company, all such Intellectual Property Rights are enforceable and there is no existing
infringement by another Person of any of the Intellectual Property Rights.  The Company and its Subsidiaries have taken
reasonable security measures to protect the secrecy, confidentiality and value of all of their intellectual properties, except
where failure to do so would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.


 


(p)        Insurance.  The
Company and the Subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in
such amounts as are prudent and customary in the businesses in which the Company and the Subsidiaries are engaged, including, but
not limited to, directors and officers insurance coverage.  Neither the Company nor any Subsidiary has been notified
that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage
from similar insurers as may be necessary to continue its business without a significant increase in cost.


 


(q)        Transactions
With Affiliates and Employees.  Except as set forth in the SEC Reports, none of the officers or directors of the
Company or any Subsidiary and, to the knowledge of the Company, none of the employees of the Company or any Subsidiary is presently
a party to any transaction with the Company or any Subsidiary (other than for services as employees, officers and directors), including
any contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental of real or
personal property to or from, providing for the borrowing of money from or lending of money to or otherwise requiring payments
to or from any officer, director or such employee or, to the knowledge of the Company, any entity in which any officer, director,
or any such employee has a substantial interest or is an officer, director, trustee, stockholder, member or partner, in each case
in excess of $120,000 other than for: (i) payment of salary or consulting fees for services rendered, (ii) reimbursement for expenses
incurred on behalf of the Company and (iii) other employee benefits, including stock option agreements under any stock option plan
of the Company.


 


(r)        Sarbanes-Oxley;
Internal Accounting Controls.  The Company and the Subsidiaries are in material compliance with any and all applicable
requirements of the Sarbanes-Oxley Act of 2002 that are effective as of the date hereof, and any and all applicable rules and regulations
promulgated by the Commission thereunder that are effective as of the date hereof and as of the Closing Date.  The Company
and the Subsidiaries maintain a system of internal accounting controls sufficient to provide reasonable assurance that: (i) transactions
are executed in accordance with management’s general or specific authorizations, (ii) transactions are recorded as necessary
to permit preparation of financial statements in conformity with GAAP and to maintain asset accountability, (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 the existing assets at reasonable intervals and appropriate action is taken with respect to any differences.
The Company and the Subsidiaries have established


 




    15 


     


    

 


disclosure
controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Company and the Subsidiaries and designed
such disclosure controls and procedures to ensure that information required to be disclosed by the Company in the reports it files
or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s
rules and forms.  The Company’s certifying officers have evaluated the effectiveness of the disclosure controls
and procedures of the Company and the Subsidiaries as of the end of the period covered by the most recently filed periodic report
under the Exchange Act (such date, the “Evaluation Date”).  The Company presented in its most recently
filed periodic report under the Exchange Act the conclusions of the certifying officers about the effectiveness of the disclosure
controls and procedures based on their evaluations as of the Evaluation Date.  Since the Evaluation Date, there have
been no changes in the internal control over financial reporting (as such term is defined in the Exchange Act) of the Company and
its Subsidiaries that have materially affected, or is reasonably likely to materially affect, the  internal control over
financial reporting of the Company and its Subsidiaries.


 


(s)        Certain
Fees.  Except as set forth on Schedule 3.1(s), other than fees to the Placement Agent, no brokerage or finder’s
fees or commissions are or will be payable by the Company or any Subsidiary to any broker, financial advisor or consultant, finder,
placement agent, investment banker, bank or other Person with respect to the transactions contemplated by the Transaction Documents.  The
Purchasers shall have no obligation with respect to any fees or with respect to any claims (other than such fees or commissions
owed by such Purchaser pursuant to agreements entered into by such Purchaser, which fees or commissions shall be the sole responsibility
of such Purchaser) made by or on behalf of other Persons for fees of a type contemplated in this Section that may be due in connection
with the transactions contemplated by the Transaction Documents.  


 


(t)         Investment
Company. The Company is not, and is not an Affiliate of, and immediately after receipt of payment for the Securities, will
not be or be an Affiliate of, an “investment company” within the meaning of the Investment Company Act of 1940, as
amended.  The Company shall conduct its business in a manner so that it will not become an “investment company”
subject to registration under the Investment Company Act of 1940, as amended.


 


(u)        Registration
Rights.  Except as set forth on Schedule 3.1(u), no Person has any right to cause the Company or any Subsidiary
to effect the registration under the Securities Act of any securities of the Company or any Subsidiary.


 


(v)        Listing
and Maintenance Requirements.  The Common Stock is registered pursuant to Section 12(b) or 12(g) of the Exchange
Act, and the Company has taken no action designed to, or which to its knowledge is likely to have the effect of, terminating the
registration of the Common Stock under the Exchange Act nor has the Company received any notification that the Commission is contemplating
terminating such registration.  The Company has not, in the 12 months preceding the date hereof, received notice from
any Trading Market on which the Common Stock is or has been listed or quoted to the effect that the Company is not in compliance
with the listing or


 




    16 


     


    

 


maintenance
requirements of such Trading Market. The Company is in compliance with all such listing and maintenance requirements.


 


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


 


(x)        Disclosure.  Except
with respect to the material terms and conditions of the transactions contemplated by the Transaction Documents, the Company confirms
that neither it nor any other Person acting on its behalf has provided any of the Purchasers or their agents or counsel with any
information that it believes constitutes or might constitute material, non-public information, which is not otherwise disclosed
in the Prospectus.  The Company understands and confirms that the Purchasers will rely on the foregoing representation
in effecting transactions in securities of the Company.  All of the disclosure furnished by or on behalf of the Company
to the Purchasers regarding the Company and its Subsidiaries, their respective businesses and the transactions contemplated hereby,
including the Disclosure Schedules to this Agreement, is true and correct in all material respects and does not contain any untrue
statement of a material fact or omit to state any material fact necessary in order to make the statements made therein, in light
of the circumstances under which they were made, not misleading.   The Company acknowledges and agrees that no Purchaser
makes or has made any representations or warranties with respect to the transactions contemplated hereby other than those specifically
set forth in Section 3.2 hereof.


 


(y)        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 any applicable shareholder approval provisions
of any Trading Market on which any of the securities of the Company are listed or designated.


 


(z)        Solvency.  Based
on the consolidated financial condition of the Company as of the Closing Date, after giving effect to the receipt by the Company
of the proceeds from the sale of the Securities hereunder, and subject to the disclosures in the SEC Reports concerning the Company’s
liquidity requirements and financial condition: (i) the fair saleable value of the Company’s assets exceeds the amount that
will be required to be paid on or in respect of the Company’s existing debts and other liabilities (including known contingent
liabilities) as they mature, (ii) the Company’s assets do not constitute


 




    17 


     


    

 


unreasonably
small capital to carry on its business as now conducted and as proposed to be conducted including its capital needs taking into
account the particular capital requirements of the business conducted by the Company, consolidated and projected capital requirements
and capital availability thereof, and (iii) the current cash flow of the Company, together with the proceeds the Company would
receive, were it to liquidate all of its assets, after taking into account all anticipated uses of the cash, would be sufficient
to pay all amounts on or in respect of its liabilities when such amounts are required to be paid.  The Company does not
intend to incur debts beyond its ability to pay such debts as they mature (taking into account the timing and amounts of cash to
be payable on or in respect of its debt).  


 


(aa)       Tax
Status.  Except for matters that would not, individually or in the aggregate, have or reasonably be expected to result
in a Material Adverse Effect, the Company and its Subsidiaries each (i) has made or filed all United States federal, state and
local income and all foreign income and franchise tax returns, reports and declarations required by any jurisdiction to which it
is subject, (ii) has paid all taxes and other governmental assessments and charges that are material in amount, shown or determined
to be due on such returns, reports and declarations and (iii) has set aside on its books provision reasonably adequate for the
payment of all material taxes for periods subsequent to the periods to which such returns, reports or declarations apply.  There
are no unpaid taxes in any material amount claimed to be due by the taxing authority of any jurisdiction, and the officers of the
Company or of any Subsidiary know of no basis for any such claim.


 


(bb)      Foreign
Corrupt Practices.  Neither the Company nor any Subsidiary, nor to the knowledge of the Company or any Subsidiary,
any agent or other person acting on behalf of the Company or any Subsidiary, has: (i) directly or indirectly, used any funds for
unlawful contributions, gifts, entertainment or other unlawful expenses related to foreign or domestic political activity, (ii)
made any unlawful payment to foreign or domestic government officials or employees or to any foreign or domestic political parties
or campaigns from corporate funds, (iii) failed to disclose fully any contribution made by the Company or any Subsidiary (or made
by any person acting on its behalf of which the Company is aware) which is  in violation of law or (iv) violated in any
material respect any provision of FCPA.


 


(cc)      Accountants.  The
Company’s independent registered accounting firm is identified in the Prospectus.  To the knowledge and belief
of the Company, such accounting firm: (i) is a registered public accounting firm as required by the Exchange Act and (ii) is expected
to express its opinion with respect to the financial statements to be included in the Company’s Annual Report for the fiscal
year ending December 31, 2016.


 


(dd)      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


 




    18 


     


    

 


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.


 


(ee)       Acknowledgment
Regarding Purchaser’s Trading Activity.  Anything in this Agreement
or elsewhere herein to the contrary notwithstanding (except for Sections 3.2(f) and 4.15 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, may presently have a “short” position in the Common Stock 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 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 Underlying Shares deliverable with respect to Securities are being determined, and (z) such
hedging activities (if any) could reduce the value of the existing stockholders' equity interests in the Company at and after
the time that the hedging activities are being conducted.  The Company acknowledges that such aforementioned hedging
activities do not constitute a breach of any of the Transaction Documents.


 


(ff)        Regulation
M Compliance.  The Company has not, and to its knowledge no one acting on its behalf has, (i) taken, directly or
indirectly, any action designed to cause or to result in the stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of any of the Securities, (ii) sold, bid for, purchased, or paid any compensation for
soliciting purchases of, any of the Securities, or (iii) paid or agreed to pay to any Person any compensation for soliciting another
to purchase any other securities of the Company, other than, in the case of clauses (ii) and (iii), compensation paid to the Placement
Agent in connection with the placement of the Securities.


 


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


 




    19 


     


    

 


Product is
being manufactured, packaged, labeled, tested, distributed, sold and/or marketed by the Company in compliance with all applicable
requirements under FDCA and similar laws, rules and regulations relating to registration, investigational use, premarket clearance,
licensure, or application approval, good manufacturing practices, good laboratory practices, good clinical practices, product listing,
quotas, labeling, advertising, record keeping and filing of reports, except where the failure to be in compliance would not have
a Material Adverse Effect.  Except as set forth on Schedule 3.1(gg), there is no pending, completed or, to the
Company's knowledge, threatened, enforcement action (including any lawsuit, arbitration, or legal or administrative or regulatory
proceeding, charge, complaint, or investigation) against the Company or any of its Subsidiaries, and none of the Company or any
of its Subsidiaries has received any notice, warning letter or other communication from the FDA or any other governmental entity,
which (i) contests the premarket clearance, licensure, registration, or approval of, the uses of, the distribution of, the manufacturing
or packaging of, the testing of, the sale of, or the labeling and promotion of any Pharmaceutical Product, (ii) withdraws its approval
of, requests the recall, suspension, or seizure of, or withdraws or orders the withdrawal of advertising or sales promotional materials
relating to, any Pharmaceutical Product, (iii) imposes a clinical hold on any clinical investigation by the Company or any of its
Subsidiaries, (iv) enjoins production at any facility of the Company or any of its Subsidiaries, (v) enters or proposes to enter
into a consent decree of permanent injunction with the Company or any of its Subsidiaries, or (vi) otherwise alleges any violation
of any laws, rules or regulations by the Company or any of its Subsidiaries, and which, either individually or in the aggregate,
would have a Material Adverse Effect.  To the Company’s knowledge, the properties, business and operations of the
Company have been and are being conducted in all material respects in accordance with all applicable laws, rules and regulations
of the FDA.  The Company has not been informed by the FDA that the FDA will prohibit the marketing, sale, license or
use in the United States of any product proposed to be developed, produced or marketed by the Company nor has the FDA expressed
any concern as to approving or clearing for marketing any product being developed or proposed to be developed by the Company.


 


(hh)      Stock
Option Plans. Each stock option granted by the Company under the Company’s stock option plan was granted (i) in accordance
with the terms of the Company’s stock option plan and (ii) with an exercise price at least equal to the fair market value
of the Common Stock on the date such stock option would be considered granted under GAAP and applicable law. No stock option granted
under the Company’s stock option plan has been backdated.  The Company has not knowingly granted, and there is
no and has been no Company policy or practice to knowingly grant, stock options prior to, or otherwise knowingly coordinate the
grant of stock options with, the release or other public announcement of material information regarding the Company or its Subsidiaries
or their financial results or prospects.


 


(ii)        Office
of Foreign Assets Control.  Neither the Company nor any Subsidiary nor, to the Company's knowledge, any director,
officer, agent, employee or affiliate of the Company or any Subsidiary is currently subject to any U.S. sanctions administered
by the Office of Foreign Assets Control of the U.S. Treasury Department (“OFAC”).


 




    20 


     


    

 


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


 


(kk)      Bank
Holding Company Act.  Neither the Company nor any of its Subsidiaries or Affiliates is subject to the Bank Holding
Company Act of 1956, as amended (the “BHCA”) and to regulation by the Board of Governors of the Federal Reserve
System (the “Federal Reserve”).  Neither the Company nor any of its Subsidiaries or Affiliates owns
or controls, directly or indirectly, five percent (5%) or more of the outstanding shares of any class of voting securities or twenty-five
percent or more of the total equity of a bank or any entity that is subject to the BHCA and to regulation by the Federal Reserve.  Neither
the Company nor any of its Subsidiaries or Affiliates exercises a controlling influence over the management or policies of a bank
or any entity that is subject to the BHCA and to regulation by the Federal Reserve.


 


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


 


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):


 


(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


 




    21 


     


    

 


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.


 


(c)        Purchaser
Status.  At the time such Purchaser was offered the Securities, it was, and as of the date hereof it is, and on each
date on which it exercises any Warrants or converts any shares of Preferred Stock it will be an “accredited investor”
as defined in Rule 501(a)(1), (a)(2), (a)(3), (a)(7) or (a)(8) 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.  Such
Purchaser and its advisors, if any, have been furnished with all materials relating to the business, financial condition and results
of operations of the Company, and materials relating to the offer and sale of the Securities, that have been requested by such
Purchaser or its advisors, if any.  Such Purchaser acknowledges and understands that its investment in the Securities
involves a significant degree of risk.


 


(e)        Access
to Information. Such Purchaser acknowledges that it has had the opportunity to review the Transaction Documents (including
all exhibits and schedules thereto) 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,


 




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neither the
Placement Agent nor any of its Affiliates has 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 directly or indirectly, nor has any Person acting on behalf of or pursuant to any understanding with such Purchaser, 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 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, 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 the identification of the availability of, or securing of, available shares
to borrow in order to effect Short Sales or similar transactions in the future.


 


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.


 


ARTICLE IV.


OTHER AGREEMENTS OF THE PARTIES


 


4.1       The
Shares, Underlying Shares. The Shares and the Conversion Shares, when issued, shall be issued free of legends.  If
all or any portion of a Warrant is exercised at a time when there is an effective registration statement to cover the issuance
or resale of the Warrant Shares or if the Warrant is exercised via cashless exercise, the Warrant Shares issued pursuant to any
such exercise shall be issued free of all legends.  If at any time following the date hereof the Registration Statement
(or any subsequent registration statement registering the sale or resale of the Warrant Shares) is not effective or is not otherwise
available for the sale or resale of the Warrant Shares, the Company shall immediately notify the holders of the Warrants in writing
that such registration statement is not then effective and thereafter shall promptly notify such holders when a registration statement
is effective again and available for the sale or resale of the Warrant Shares (it being understood and agreed that the foregoing
shall not limit the ability of


 




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the Company to issue,
or any Purchaser to sell, any of the Warrant Shares in compliance with applicable federal and state securities laws).  The
Company shall use best efforts to keep a registration statement (including the Registration Statement) registering the issuance
or resale of the Warrant Shares effective during the term of the Warrants.


 


4.2       Acknowledgment
of Dilution.  The Company acknowledges that the issuance of the Securities may result in dilution of the currently
outstanding shares of Common Stock, which dilution may be substantial under certain market conditions.  The Company further
acknowledges that its obligations under the Transaction Documents, including, without limitation, its obligation to issue the Underlying
Shares pursuant to the Transaction Documents, are unconditional and absolute and not subject to any right of set off, counterclaim,
delay or reduction, regardless of the effect of any such dilution or any claim the Company may have against any Purchaser and regardless
of the dilutive effect that such issuance may have on the ownership of the other stockholders of the Company.


 


4.3       Furnishing
of Information; Public Information.  Until the earliest of the time that (i) no Purchaser owns Securities or (ii)
the Warrants have expired, the Company covenants to maintain the registration of the Common Stock under Section 12(b) or 12(g)
of the Exchange Act and 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.  


 


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


 


4.5       Conversion
and Exercise Procedures.  Each of the form of Notice of Exercise included in the Warrants and the form of Notice
of Conversion included in the Certificate of Designation set forth the totality of the procedures required of the Purchasers in
order to exercise the Warrants or convert the Preferred Stock.  Without limiting the preceding sentences, no ink-original
Notice of Exercise or Notice of Conversion shall be required, nor shall any medallion guarantee (or other type of guarantee or
notarization) of any Notice of Exercise or Notice of Conversion form be required in order to exercise the Warrants or convert the
Preferred Stock.  No additional legal opinion, other information or instructions shall be required of the Purchasers
to exercise their Warrants or convert their Preferred Stock.  The Company shall honor exercises of the Warrants and conversions
of the Preferred Stock and shall deliver Underlying Shares in accordance with the terms, conditions and time periods set forth
in the Transaction Documents.


 


4.6       Securities
Laws Disclosure; Publicity.  The Company shall (a) by 9:00 a.m. (New York City time) on the 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 8-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


 




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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. 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).


 


4.7       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.


 


4.8       Non-Public
Information.  Except with respect to the material terms and conditions of the transactions contemplated by the Transaction
Documents, 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 the Company believes constitutes material non-public information, unless prior
thereto such Purchaser shall have entered into a written agreement with the Company regarding the confidentiality and use of such
information.  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 Company, any of its Subsidiaries, or any of their respective officers, directors, agents, employees
or Affiliates, or a duty to the Company, and 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 8-K.  The Company understands and confirms that each Purchaser shall be relying
on the foregoing covenant in effecting transactions in securities of the Company.


 




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4.9       Use
of Proceeds.  The Company shall use the net proceeds from the sale of the Securities hereunder as set forth in the
Prospectus, and shall not otherwise 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 Stock or Common Stock Equivalents, (c) for the settlement of any outstanding litigation, except in the case of each
of clauses (a), (b) and (c) as set forth in the Prospectus, or (d) in violation of FCPA or OFAC regulations.


 


4.10     Indemnification
of Purchasers.   Subject to the provisions of this Section 4.10, 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 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 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 Purchaser
Parties in any capacity, or any of them or their respective Affiliates, by any stockholder 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 stockholder 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).  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 or liability is attributable to (A) any Purchaser Party’s breach of any of the representations,
warranties, covenants or agreements


 




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made by such Purchaser
Party in this Agreement or in the other Transaction Documents, or (B) any conduct by such Purchaser Party which constitutes gross
negligence or willful misconduct. 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.


 


4.11     Reservation
and Listing of Securities.


 


(a)        The
Company shall maintain a reserve from its duly authorized shares of Common Stock for issuance pursuant to the Transaction Documents
in such amount as may then be required to fulfill its obligations in full under the Transaction Documents.


 


(b)        If,
on any date, the number of authorized but unissued (and otherwise unreserved) shares of Common Stock is less than  (i) the
Required Minimum on such date, minus (ii) the number of shares of Common Stock previously issued pursuant to the Transaction Documents,
then the Board of Directors shall use commercially reasonable efforts to amend the Company’s certificate or articles of incorporation
to increase the number of authorized but unissued shares of Common Stock to at least the Required Minimum at such time (minus the
number of shares of Common Stock previously issued pursuant to the Transaction Documents), as soon as reasonably practicable and
in any event not later than the 75th day after such date; provided that the Company will not be required at any time
to authorize a number of shares of Common Stock greater than the maximum remaining number of shares of Common Stock that could
possibly be issued after such time pursuant to the Transaction Documents.


 


(c)        The
Company shall, if applicable: (i) in the time and manner required by the principal Trading Market, prepare and file with such Trading
Market an additional shares listing application covering a number of shares of Common Stock at least equal to the Required Minimum
on the date of such application, (ii) take all steps necessary to cause such shares of Common Stock to be approved for listing
or quotation on such Trading Market as soon as possible thereafter, (iii) provide to the Purchasers evidence of such listing or
quotation and (iv) maintain the listing or quotation of such Common Stock on any date at least equal to the Required Minimum on
such date on such Trading Market or another Trading Market.


 


4.12     [RESERVED]


 


4.13     Subsequent
Equity Sales.  


 


(a)        From
the date hereof until the date that is ninety (90) days after the Closing Date, neither the Company nor any Subsidiary shall issue,
enter into any agreement to issue or announce the issuance or proposed issuance of any shares of Common Stock or Common Stock Equivalents,
provided that, following the ninetieth (90th) day after the Closing Date, on any date that the Purchasers hold less
than 50% in


 




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interest of
the Preferred Stock issued at the Closing, this Section 4.13(a) shall no longer apply.


 


(b)        From
the date hereof until the earlier of (i) such time as no Purchaser holds any of the Warrants or (ii) the one year anniversary of
the Closing Date, the Company shall be prohibited from effecting or entering into an agreement to effect any issuance by the Company
or any of its Subsidiaries of Common Stock or Common Stock 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
shares of Common Stock 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 shares of Common Stock 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 Stock or (ii) enters into any agreement, including,
but not limited to, an equity line of credit, whereby the Company may issue securities at a future determined price.  
Notwithstanding the foregoing, commencing on the date that is [                   ] months following the Closing, the Company shall be permitted
to enter into, or effect a transaction under, an at the market offering. 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 4.13 shall not apply in respect of an Exempt Issuance, except that no Variable Rate Transaction shall
be an Exempt Issuance.


 


4.14     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.


 


4.15     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 4.6.  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 4.6, such Purchaser will maintain the


 




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confidentiality of the
existence and terms of this transaction and the information included in the Transaction Documents and the Disclosure Schedules.  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 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 4.6, (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 4.6 and (iii) no Purchaser shall have any duty of confidentiality to the Company or its Subsidiaries after the issuance
of the initial press release as described in Section 4.6.  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.


 


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 on or before [l], 2016; provided, however, that the
right to terminate this Agreement under this Section 5.1 shall not be available to a Purchaser whose failure to fulfill any obligation
under this Agreement has been the proximate cause of or resulted in the failure of the transactions contemplated hereunder to occur
on or before such date; provided, further, however, that such termination will not 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 conversion or 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, 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 matters, which the parties acknowledge have been merged into such documents, exhibits and schedules.


 




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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 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 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.


 


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 the Purchasers holding at least 67% in interest of the shares of Common
Stock and Preferred Stock, determined as a single class on an as-converted basis, then outstanding and held by the Purchasers or
their permitted assigns or, in the case of a waiver, by the party against whom enforcement of any such waived provision is sought.  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.


 


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
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 a third party beneficiary with respect to the representations
and warranties of the Company in Section 3.1 hereof and the representations and warranties of the Purchasers in Section 3.2 hereof.  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 4.10 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


 




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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, suit or Proceeding, any claim that it is not personally subject to the jurisdiction
of any such court, that such suit, 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 suit, 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 either party shall commence an Action, suit or Proceeding to enforce any provisions
of the Transaction Documents, then, in addition to the obligations of the Company under Section 4.10, the prevailing party in such
Action, suit or Proceeding shall be reimbursed by the other 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 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


 




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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 a conversion of the Preferred Stock or exercise of a Warrant, the applicable Purchaser shall be required to return
any shares of Common Stock subject to any such rescinded conversion or 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 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 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     [RESERVED]


 


5.18     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


 




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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.


 


5.19     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.


 


5.20     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.


 


5.21     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 shares of Common Stock 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 Stock that occur after
the date of this Agreement.


 


5.22     WAIVER
OF JURY TRIAL.  IN ANY ACTION, SUIT, OR PROCEEDING IN ANY JURISDICTION BROUGHT BY ANY PARTY AGAINST ANY OTHER PARTY,
THE PARTIES EACH 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)


 




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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.


 


	
        BELLEROPHON THERAPEUTICS,
        INC.

         

         
	 	
        Address for Notice

        184 Liberty Corner Road, Suite 302

        Warren, New Jersey 07059

        Attn: Chief Financial Officer

	
        By:__________________________________________

             Name:

             Title:

         

        With a copy to (which shall not constitute notice):
	 	Fax:
	
         

        Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.

        666 Third Avenue

        New York, NY 10017

        Attn: Jeffrey Schultz, Esq.
	 	 


 


[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK


SIGNATURE PAGE FOR PURCHASER FOLLOWS]


 




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[PURCHASER
SIGNATURE PAGES TO BELLEROPHON 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 Securities to Purchaser (if not same
as address for notice):


 


Subscription Amount: $_____________


 


Shares of Common Stock: ____________


 


Shares of Preferred Stock: ____________


 


Warrant Shares: _________________


 


EIN Number: _______________________


 


[SIGNATURE PAGES CONTINUE]


 




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