Unassociated Document


     

    Exhibit
4.5


    VENTRUS
BIOSCIENCES, INC.

    COMMON
STOCK WARRANT

     

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

     

    This
certifies that PARAMOUNT CREDIT
PARTNERS, LLC (the “Holder”), its
designees or permitted assigns, subject to the terms and conditions set forth
herein, at any time after the Commencement Date and prior to the Expiration Date
(as such terms are defined below), is entitled to purchase from VENTRUS BIOSCIENCES, INC., a
Delaware corporation (the “Company”), that
number of fully-paid and non-assessable shares (subject to adjustment as
provided herein) (the “Warrant Shares”) of
the Company’s Common Stock, $0.001 par value per share (the “Common Stock”), equal
to (i) forty percent (40%) of the principal amount of that certain Senior 10%
Promissory Note dated the date hereof in the principal amount of $1,100,000,
issued by the Company to the Holder (the “Note”) pursuant to
that certain Note and Warrant Purchase Agreement dated the date hereof between
the Company and the Holder (the “Purchase Agreement”),
divided by (ii) the lowest price at which equity securities of the Company are
sold in the first Qualified Financing (as defined in the Note) following the
date hereof (the “Lowest Price Paid”),
upon surrender to the Company at its principal office (or at such other location
as the Company may advise the Holder in writing) of this Warrant properly
endorsed with the Form of Subscription attached hereto duly completed and signed
and upon payment of the aggregate Exercise Price (as defined below) for the
number of Warrant Shares for which this Warrant is being exercised determined in
accordance with the provisions hereof.  The exercise price (the “Exercise Price”) per
Warrant Share issuable pursuant to this Common Stock Warrant shall be equal to
110% of the Lowest Price Paid, payable in accordance with Section 1(b)
hereof.

     

    Notwithstanding
the foregoing, in the event that the Company consummates a merger, share
exchange, or other transaction (or series of related transactions), other than
in connection with a Qualified Financing, in which (i) the Company merges into
or otherwise becomes a wholly-owned subsidiary of a company subject to the
public company reporting requirements of the Securities Exchange Act of 1934, as
amended, and (ii) the aggregate consideration accorded to the Company in such
transaction(s) (the “Reverse Merger
Consideration”) is greater than or equal to $10,000,000 (a “Reverse Merger”),
then this Warrant shall be exercisable immediately prior to the Reverse Merger
(and subject to Section 3 hereof following the Reverse Merger) for that number
of Warrant Shares, with an Exercise Price, in each case determined in accordance
with, and on the same terms and conditions, as provided for in the event of a
Qualified Financing above, provided that for purposes thereof, the Lowest Price
Paid shall be deemed equal to the quotient obtained by dividing the (i) Reverse
Merger Consideration less the amount of unpaid principal and accrued interest
under the Note by (ii) the number of shares of Common Stock outstanding
immediately prior to such Reverse Merger, on a fully diluted basis, but without
giving effect to the conversion of the Notes or any other senior promissory
notes of the Company or any placement warrants that have been issued by the
Company issued to the Placement Agent (as defined in the Purchase
Agreement).  If any Reverse Merger Consideration is other than cash,
its value will be deemed to be its fair market value as determined, in good
faith, by the Board of Directors of the Company.


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    


    


     

    Notwithstanding
the foregoing, if neither a Qualified Financing nor a Reverse Merger occur on or
before January 23, 2011, then this Warrant will be exercisable for that number
of Warrant Shares equal to forty percent (40%) of the principal amount of the
Note purchased by the original holder divided by $1.00, at a per share exercise
price of $1.00.

     

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

     

    1.           Exercise, Issuance of
Certificates.  Subject to Sections 3(d) and 4 hereof, the
Holder may exercise this Warrant, at any time or from time to time, during the
period (a) commencing on the consummation of a Qualified Financing or a Reverse
Merger (the “Commencement
Date”), and (b)
expiring at 5:00 p.m. (Eastern Time) on January 23, 2014 (the “Expiration Date”).  The Holder may
exercise this Warrant on or prior to the Expiration Date for all or any part of
the Warrant Shares (but not for a fraction of a share) that may be purchased
hereunder, as that number may be adjusted pursuant to Section 3 of this
Warrant.  The Company agrees that the Warrant Shares purchased under
this Warrant shall be and are deemed to be issued to the Holder hereof as the
record owner of such Warrant Shares as of the close of business on the date on
which this Warrant shall have been surrendered, properly endorsed, the completed
and executed Form of Subscription delivered, and payment made for such Warrant
Shares (such date, a “Date of Exercise”).  Certificates for
the Warrant Shares so purchased, together with any other securities or property
to which the Holder hereof is entitled upon such exercise, shall be delivered to
the Holder hereof by the Company at the Company’s expense as soon as practicable
after the rights represented by this Warrant have been so exercised, but in any
event not later than ten (10) business days following the Date of
Exercise.  In case of a purchase of less than all the Warrant Shares
which may be purchased under this Warrant, the Company shall cancel this Warrant
and execute and deliver to the Holder hereof within a reasonable time a new
Warrant or Warrants of like tenor for the balance of the Warrant Shares
purchasable under the Warrant surrendered upon such purchase.  Each
stock certificate so delivered shall be registered in the name of such Holder
and issued with a legend in substantially the form of the legend placed on the
front of this Warrant.

     

    (a)           The
Company’s obligations to issue and deliver Warrant Shares in accordance with the
terms hereof are absolute and unconditional, irrespective of any action or
inaction by the Holder to enforce the same.  Nothing herein
shall limit a Holder’s right to pursue any other remedies available to it
hereunder, at law or in equity including, without limitation, a decree of
specific performance and/or injunctive relief with respect to the Company’s
failure to timely deliver certificates representing shares of Common Stock upon
exercise of the Warrant as required pursuant to the terms hereof.

     

    (b)           Payment of Exercise
Price.  The Holder shall
pay the Exercise Price by delivering immediately available funds to the
Company.


    
      
         


      

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

     

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

     

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

     

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


    
      
         


      

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

     

    (d)     
    Termination Upon a Sale of
the Company.  Notwithstanding any other provision of this
Section 3, upon the consummation of a Sale of the Company (as defined in the
Note) prior to, but not in connection with, a Qualified Financing or Reverse
Merger, this Warrant shall terminate immediately upon such consummation without
the opportunity for exercise.  “Sale of the Company” shall mean a
transaction (or series of related transactions) with one or more non-affiliates,
pursuant to which such party or parties acquire (x) capital stock of the Company
or the surviving entity possessing the voting power to elect a majority of the
Board of Directors of the Company or the surviving entity (whether by merger,
consolidation, sale or transfer of the Company’s capital stock or otherwise); or
(y) all or substantially all of the Company’s assets determined on a
consolidated basis.

     

    4.           Redemption of
Warrants.

     

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

     

    (b)           Notice of
Redemption.  In the case of any redemption of this Warrant, the
Company shall give notice of such redemption to the Holder hereof as provided in
this Section 4(b).  Notice of redemption to the Holder of this Warrant
shall be given in person, by recognized overnight courier, mailed by certified
or registered mail, return receipt requested, or by confirmed facsimile
transmission, to the Holder’s last address and/or facsimile of record with the
Company not less than twenty (20) days prior to the date fixed for
redemption.  Any notice which is given in the manner herein provided
shall be conclusively presumed to have been duly given, whether or not the
Holder receives the notice.  Each such notice shall specify the date
fixed for redemption, the place of redemption and the aggregate Redemption
Price, and shall state that payment of the Redemption Price will be made upon
surrender of this Warrant at such place of redemption, and that if not exercised
by the close of business on the date fixed for redemption, the exercise rights
of the Warrant shall expire unless extended by the Company.  Such
notice shall also state the current Exercise Price and the date on which the
right to exercise the Warrant will expire unless extended by the
Company.


    
      
         


      

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

     

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

     

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

     

    7.           Limited
Transferability.  The Holder represents that by accepting this
Warrant it understands that this Warrant and any securities obtainable upon
exercise of this Warrant have not been registered for sale under Federal or
state securities laws and are being offered and sold to the Holder pursuant to
one or more exemptions from the registration requirements of such securities
laws.  In the absence of an effective registration of such securities
or an exemption therefrom, any certificates for such securities shall bear the
legend set forth on the first page hereof.  The Holder understands
that it must bear the economic risk of its investment in this Warrant and any
securities obtainable upon exercise of this Warrant for an indefinite period of
time, as this Warrant and such securities have not been registered under Federal
or state securities laws and therefore cannot be sold unless subsequently
registered under such laws, unless an exemption from such registration is
available.

     

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

     

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


    
      
         


      

      
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    10.         Governing
Law.  This Warrant shall be construed and enforced in
accordance with, and the rights of the parties shall be governed by, the laws of
the State of New York without regard to the conflicts of laws provisions
thereof.

     

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

     

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

     

    13.         Successors and
Assigns.  This Warrant and the rights evidenced hereby shall
inure to the benefit of and be binding upon the successors of the Company and
the successors and assigns of the Holder.

     

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

     

    Remainder
of Page Intentionally Left Blank; Signature Page Follows


    
      
         


      

      
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    IN WITNESS WHEREOF, the
Company has caused this Warrant to be duly executed by its officer, thereunto
duly authorized as of this 23rd day of
January, 2009.

     

    
      
        	
                VENTRUS
      BIOSCIENCES, INC.

              
	 
      	 
      
	
                By:

              	
                /s/ Thom Rowland

              
	
                Name:

              	
                Thom
      Rowland

              
	
                Title:

              	
                President
      and CEO

              


      

    

     

    Signature
Page _____ Common Stock Warrant


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    


    FORM
OF SUBSCRIPTION

     

    (To be
signed only upon exercise of Warrant)

     

    To:         [COMPANY
NAME]

     

    The
undersigned, the holder of the attached Common Stock Warrant, hereby elects to
exercise the purchase right represented by such Warrant for, and to purchase
thereunder ________________, shares of Common Stock of [COMPANY NAME] and such
holder herewith makes payment of $ ______ therefor.

     

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

            
	
              delivered
      to: 

            	 
      
	
              whose
      address is: 

            	 
      


    

     

    DATED:                                                      

     

    
      
        
          
            	
                      

                  
	
                    (Signature
      must conform in all respects to name of

                    Holder
      as specified on the face of the Warrant)

                  
	 
	
                    Name: 

                  	
                      

                  
	
                    Title:

                  	
                      

                  


          

        

      

    


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

    


    VENTRUS
BIOSCIENCES, INC.

    COMMON
STOCK WARRANT

     

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

     

    This
certifies that PARAMOUNT CREDIT
PARTNERS, LLC (the “Holder”), its
designees or permitted assigns, subject to the terms and conditions set forth
herein, at any time after the Commencement Date and prior to the Expiration Date
(as such terms are defined below), is entitled to purchase from VENTRUS BIOSCIENCES, INC., a
Delaware corporation (the “Company”), that
number of fully-paid and non-assessable shares (subject to adjustment as
provided herein) (the “Warrant Shares”) of
the Company’s Common Stock, $0.001 par value per share (the “Common Stock”), equal
to (i) forty percent (40%) of the principal amount of that certain Senior 10%
Promissory Note dated the date hereof in the principal amount of $100,000,
issued by the Company to the Holder (the “Note”) pursuant to
that certain Note and Warrant Purchase Agreement dated the date hereof between
the Company and the Holder (the “Purchase Agreement”),
divided by (ii) the lowest price at which equity securities of the Company are
sold in the first Qualified Financing (as defined in the Note) following the
date hereof (the “Lowest Price Paid”),
upon surrender to the Company at its principal office (or at such other location
as the Company may advise the Holder in writing) of this Warrant properly
endorsed with the Form of Subscription attached hereto duly completed and signed
and upon payment of the aggregate Exercise Price (as defined below) for the
number of Warrant Shares for which this Warrant is being exercised determined in
accordance with the provisions hereof.  The exercise price (the “Exercise Price”) per
Warrant Share issuable pursuant to this Common Stock Warrant shall be equal to
110% of the Lowest Price Paid, payable in accordance with Section 1(b)
hereof.

     

    Notwithstanding
the foregoing, in the event that the Company consummates a merger, share
exchange, or other transaction (or series of related transactions), other than
in connection with a Qualified Financing, in which (i) the Company merges into
or otherwise becomes a wholly-owned subsidiary of a company subject to the
public company reporting requirements of the Securities Exchange Act of 1934, as
amended, and (ii) the aggregate consideration accorded to the Company in such
transaction(s) (the “Reverse Merger
Consideration”) is greater than or equal to $10,000,000 (a “Reverse Merger”),
then this Warrant shall be exercisable immediately prior to the Reverse Merger
(and subject to Section 3 hereof following the Reverse Merger) for that number
of Warrant Shares, with an Exercise Price, in each case determined in accordance
with, and on the same terms and conditions, as provided for in the event of a
Qualified Financing above, provided that for purposes thereof, the Lowest Price
Paid shall be deemed equal to the quotient obtained by dividing the (i) Reverse
Merger Consideration less the amount of unpaid principal and accrued interest
under the Note by (ii) the number of shares of Common Stock outstanding
immediately prior to such Reverse Merger, on a fully diluted basis, but without
giving effect to the conversion of the Notes or any other senior promissory
notes of the Company or any placement warrants that have been issued by the
Company issued to the Placement Agent (as defined in the Purchase
Agreement).  If any Reverse Merger Consideration is other than cash,
its value will be deemed to be its fair market value as determined, in good
faith, by the Board of Directors of the Company.


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    


    Notwithstanding
the foregoing, if neither a Qualified Financing nor a Reverse Merger occur on or
before March 25, 2011, then this Warrant will be exercisable for that number of
Warrant Shares equal to forty percent (40%) of the principal amount of the Note
purchased by the original holder divided by $1.00, at a per share exercise price
of $1.00.

     

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

     

    1.           Exercise, Issuance of
Certificates.  Subject to Sections 3(d) and 4 hereof, the
Holder may exercise this Warrant, at any time or from time to time, during the
period (a) commencing on the consummation of a Qualified Financing or a Reverse
Merger (the “Commencement
Date”), and (b)
expiring at 5:00 p.m. (Eastern Time) on March 25, 2014 (the “Expiration Date”).  The Holder may
exercise this Warrant on or prior to the Expiration Date for all or any part of
the Warrant Shares (but not for a fraction of a share) that may be purchased
hereunder, as that number may be adjusted pursuant to Section 3 of this
Warrant.  The Company agrees that the Warrant Shares purchased under
this Warrant shall be and are deemed to be issued to the Holder hereof as the
record owner of such Warrant Shares as of the close of business on the date on
which this Warrant shall have been surrendered, properly endorsed, the completed
and executed Form of Subscription delivered, and payment made for such Warrant
Shares (such date, a “Date of Exercise”).  Certificates for
the Warrant Shares so purchased, together with any other securities or property
to which the Holder hereof is entitled upon such exercise, shall be delivered to
the Holder hereof by the Company at the Company’s expense as soon as practicable
after the rights represented by this Warrant have been so exercised, but in any
event not later than ten (10) business days following the Date of
Exercise.  In case of a purchase of less than all the Warrant Shares
which may be purchased under this Warrant, the Company shall cancel this Warrant
and execute and deliver to the Holder hereof within a reasonable time a new
Warrant or Warrants of like tenor for the balance of the Warrant Shares
purchasable under the Warrant surrendered upon such purchase.  Each
stock certificate so delivered shall be registered in the name of such Holder
and issued with a legend in substantially the form of the legend placed on the
front of this Warrant.

     

    (a)           The
Company’s obligations to issue and deliver Warrant Shares in accordance with the
terms hereof are absolute and unconditional, irrespective of any action or
inaction by the Holder to enforce the same.  Nothing herein
shall limit a Holder’s right to pursue any other remedies available to it
hereunder, at law or in equity including, without limitation, a decree of
specific performance and/or injunctive relief with respect to the Company’s
failure to timely deliver certificates representing shares of Common Stock upon
exercise of the Warrant as required pursuant to the terms hereof.

     

    (b)           Payment of Exercise
Price.  The Holder shall
pay the Exercise Price by delivering immediately available funds to the
Company.


    
      
         


      

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

     

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

     

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

     

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


    
      
         


      

      
        3

        
          

        

      

      
         


      

    


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

     

    (d)           Termination Upon a Sale of
the Company.  Notwithstanding any other provision of this
Section 3, upon the consummation of a Sale of the Company (as defined in the
Note) prior to, but not in connection with, a Qualified Financing or Reverse
Merger, this Warrant shall terminate immediately upon such consummation without
the opportunity for exercise.  “Sale of the Company” shall mean a
transaction (or series of related transactions) with one or more non-affiliates,
pursuant to which such party or parties acquire (x) capital stock of the Company
or the surviving entity possessing the voting power to elect a majority of the
Board of Directors of the Company or the surviving entity (whether by merger,
consolidation, sale or transfer of the Company’s capital stock or otherwise); or
(y) all or substantially all of the Company’s assets determined on a
consolidated basis.

     

    4.           Redemption of
Warrants.

     

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

     

    (b)           Notice of
Redemption.  In the case of any redemption of this Warrant, the
Company shall give notice of such redemption to the Holder hereof as provided in
this Section 4(b).  Notice of redemption to the Holder of this Warrant
shall be given in person, by recognized overnight courier, mailed by certified
or registered mail, return receipt requested, or by confirmed facsimile
transmission, to the Holder’s last address and/or facsimile of record with the
Company not less than twenty (20) days prior to the date fixed for
redemption.  Any notice which is given in the manner herein provided
shall be conclusively presumed to have been duly given, whether or not the
Holder receives the notice.  Each such notice shall specify the date
fixed for redemption, the place of redemption and the aggregate Redemption
Price, and shall state that payment of the Redemption Price will be made upon
surrender of this Warrant at such place of redemption, and that if not exercised
by the close of business on the date fixed for redemption, the exercise rights
of the Warrant shall expire unless extended by the Company.  Such
notice shall also state the current Exercise Price and the date on which the
right to exercise the Warrant will expire unless extended by the
Company.

     

    
      
         


      

      
        4

        
          

        

      

      
         


      

    


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

     

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

     

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

     

    7.           Limited
Transferability.  The Holder represents that by accepting this
Warrant it understands that this Warrant and any securities obtainable upon
exercise of this Warrant have not been registered for sale under Federal or
state securities laws and are being offered and sold to the Holder pursuant to
one or more exemptions from the registration requirements of such securities
laws.  In the absence of an effective registration of such securities
or an exemption therefrom, any certificates for such securities shall bear the
legend set forth on the first page hereof.  The Holder understands
that it must bear the economic risk of its investment in this Warrant and any
securities obtainable upon exercise of this Warrant for an indefinite period of
time, as this Warrant and such securities have not been registered under Federal
or state securities laws and therefore cannot be sold unless subsequently
registered under such laws, unless an exemption from such registration is
available.

     

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

     

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


    
      
         


      

      
        5

        
          

        

      

      
         


      

    


    10.         Governing
Law.  This Warrant shall be construed and enforced in
accordance with, and the rights of the parties shall be governed by, the laws of
the State of New York without regard to the conflicts of laws provisions
thereof.

     

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

     

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

     

    13.         Successors and
Assigns.  This Warrant and the rights evidenced hereby shall
inure to the benefit of and be binding upon the successors of the Company and
the successors and assigns of the Holder.

     

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

     

    Remainder
of Page Intentionally Left Blank; Signature Page Follows


    
      
         


      

      
        6

        
          

        

      

      
         


      

    


    IN WITNESS WHEREOF, the
Company has caused this Warrant to be duly executed by its officer, thereunto
duly authorized as of this 25th day of
March, 2009.

     

    
      
        
          	
                  VENTRUS
      BIOSCIENCES, INC.

                	 
	 
      	 
	
                  By:

                	
                  /s/ Thom Rowland

                	 
	
                  Name:  

                	
                  Thom
      Rowland

                	 
	
                  Title:

                	
                  President
      and CEO

                	 


        

      

    

    


    Signature
Page _____ Common Stock Warrant


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    


    FORM
OF SUBSCRIPTION

     

    (To be
signed only upon exercise of Warrant)

     

    To:        [COMPANY
NAME]

     

    The
undersigned, the holder of the attached Common Stock Warrant, hereby elects to
exercise the purchase right represented by such Warrant for, and to purchase
thereunder, ________________________ shares of Common Stock of [COMPANY NAME]
and such holder herewith makes payment of $__________ therefor.

     

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

    delivered
to:  
_________________________________________________________________________________________

    whose
address is:  
_____________________________________________________________________________________

    


    DATED:                                                      

     

    
      
        	
                    

              
	
                (Signature
      must conform in all respects to name of

              
	
                Holder
      as specified on the face of the Warrant)

              
	 
      
	
                Name:  

              	
                    

              
	 
      	 
      
	
                Title:

              	
                    

              


      

    


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

    


    VENTRUS
BIOSCIENCES, INC.

    COMMON
STOCK WARRANT

     

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

     

    This
certifies that PARAMOUNT CREDIT
PARTNERS, LLC (the “Holder”), its
designees or permitted assigns, subject to the terms and conditions set forth
herein, at any time after the Commencement Date and prior to the Expiration Date
(as such terms are defined below), is entitled to purchase from VENTRUS BIOSCIENCES, INC., a
Delaware corporation (the “Company”), that
number of fully-paid and non-assessable shares (subject to adjustment as
provided herein) (the “Warrant Shares”) of
the Company’s Common Stock, $0.001 par value per share (the “Common Stock”), equal
to (i) forty percent (40%) of the principal amount of that certain Senior 10%
Promissory Note dated the date hereof in the principal amount of $250,000,
issued by the Company to the Holder (the “Note”) pursuant to
that certain Note and Warrant Purchase Agreement dated the date hereof between
the Company and the Holder (the “Purchase Agreement”),
divided by (ii) the lowest price at which equity securities of the Company are
sold in the first Qualified Financing (as defined in the Note) following the
date hereof (the “Lowest Price Paid”),
upon surrender to the Company at its principal office (or at such other location
as the Company may advise the Holder in writing) of this Warrant properly
endorsed with the Form of Subscription attached hereto duly completed and signed
and upon payment of the aggregate Exercise Price (as defined below) for the
number of Warrant Shares for which this Warrant is being exercised determined in
accordance with the provisions hereof.  The exercise price (the “Exercise Price”) per
Warrant Share issuable pursuant to this Common Stock Warrant shall be equal to
110% of the Lowest Price Paid, payable in accordance with Section 1(b)
hereof.

     

    Notwithstanding
the foregoing, in the event that the Company consummates a merger, share
exchange, or other transaction (or series of related transactions), other than
in connection with a Qualified Financing, in which (i) the Company merges into
or otherwise becomes a wholly-owned subsidiary of a company subject to the
public company reporting requirements of the Securities Exchange Act of 1934, as
amended, and (ii) the aggregate consideration accorded to the Company in such
transaction(s) (the “Reverse Merger
Consideration”) is greater than or equal to $10,000,000 (a “Reverse Merger”),
then this Warrant shall be exercisable immediately prior to the Reverse Merger
(and subject to Section 3 hereof following the Reverse Merger) for that number
of Warrant Shares, with an Exercise Price, in each case determined in accordance
with, and on the same terms and conditions, as provided for in the event of a
Qualified Financing above, provided that for purposes thereof, the Lowest Price
Paid shall be deemed equal to the quotient obtained by dividing the (i) Reverse
Merger Consideration less the amount of unpaid principal and accrued interest
under the Note by (ii) the number of shares of Common Stock outstanding
immediately prior to such Reverse Merger, on a fully diluted basis, but without
giving effect to the conversion of the Notes or any other senior promissory
notes of the Company or any placement warrants that have been issued by the
Company issued to the Placement Agent (as defined in the Purchase
Agreement).  If any Reverse Merger Consideration is other than cash,
its value will be deemed to be its fair market value as determined, in good
faith, by the Board of Directors of the Company.


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    


    Notwithstanding
the foregoing, if neither a Qualified Financing nor a Reverse Merger occur on or
before June 1, 2011, then this Warrant will be exercisable for that number of
Warrant Shares equal to forty percent (40%) of the principal amount of the Note
purchased by the original holder divided by $1.00, at a per share exercise price
of $1.00.

     

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

     

    1.           Exercise, Issuance of
Certificates.  Subject to Sections 3(d) and 4 hereof, the
Holder may exercise this Warrant, at any time or from time to time, during the
period (a) commencing on the consummation of a Qualified Financing or a Reverse
Merger (the “Commencement
Date”), and (b)
expiring at 5:00 p.m. (Eastern Time) on June 1, 2014 (the “Expiration Date”).  The Holder may
exercise this Warrant on or prior to the Expiration Date for all or any part of
the Warrant Shares (but not for a fraction of a share) that may be purchased
hereunder, as that number may be adjusted pursuant to Section 3 of this
Warrant.  The Company agrees that the Warrant Shares purchased under
this Warrant shall be and are deemed to be issued to the Holder hereof as the
record owner of such Warrant Shares as of the close of business on the date on
which this Warrant shall have been surrendered, properly endorsed, the completed
and executed Form of Subscription delivered, and payment made for such Warrant
Shares (such date, a “Date of Exercise”).  Certificates for
the Warrant Shares so purchased, together with any other securities or property
to which the Holder hereof is entitled upon such exercise, shall be delivered to
the Holder hereof by the Company at the Company’s expense as soon as practicable
after the rights represented by this Warrant have been so exercised, but in any
event not later than ten (10) business days following the Date of
Exercise.  In case of a purchase of less than all the Warrant Shares
which may be purchased under this Warrant, the Company shall cancel this Warrant
and execute and deliver to the Holder hereof within a reasonable time a new
Warrant or Warrants of like tenor for the balance of the Warrant Shares
purchasable under the Warrant surrendered upon such purchase.  Each
stock certificate so delivered shall be registered in the name of such Holder
and issued with a legend in substantially the form of the legend placed on the
front of this Warrant.

     

    (a)           The
Company’s obligations to issue and deliver Warrant Shares in accordance with the
terms hereof are absolute and unconditional, irrespective of any action or
inaction by the Holder to enforce the same.  Nothing herein
shall limit a Holder’s right to pursue any other remedies available to it
hereunder, at law or in equity including, without limitation, a decree of
specific performance and/or injunctive relief with respect to the Company’s
failure to timely deliver certificates representing shares of Common Stock upon
exercise of the Warrant as required pursuant to the terms hereof.

     

    (b)           Payment of Exercise
Price.  The Holder shall
pay the Exercise Price by delivering immediately available funds to the
Company.


    
      
         


      

      
        2

        
          

        

      

      
         


      

    


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

     

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

     

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

     

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


    
      
         


      

      
        3

        
          

        

      

      
         


      

    


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

     

    (d)           Termination Upon a Sale of
the Company.  Notwithstanding any other provision of this
Section 3, upon the consummation of a Sale of the Company (as defined in the
Note) prior to, but not in connection with, a Qualified Financing or Reverse
Merger, this Warrant shall terminate immediately upon such consummation without
the opportunity for exercise.  “Sale of the Company” shall mean a
transaction (or series of related transactions) with one or more non-affiliates,
pursuant to which such party or parties acquire (x) capital stock of the Company
or the surviving entity possessing the voting power to elect a majority of the
Board of Directors of the Company or the surviving entity (whether by merger,
consolidation, sale or transfer of the Company’s capital stock or otherwise); or
(y) all or substantially all of the Company’s assets determined on a
consolidated basis.

     

    4.           Redemption of
Warrants.

     

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

     

    (b)           Notice of
Redemption.  In the case of any redemption of this Warrant, the
Company shall give notice of such redemption to the Holder hereof as provided in
this Section 4(b).  Notice of redemption to the Holder of this Warrant
shall be given in person, by recognized overnight courier, mailed by certified
or registered mail, return receipt requested, or by confirmed facsimile
transmission, to the Holder’s last address and/or facsimile of record with the
Company not less than twenty (20) days prior to the date fixed for
redemption.  Any notice which is given in the manner herein provided
shall be conclusively presumed to have been duly given, whether or not the
Holder receives the notice.  Each such notice shall specify the date
fixed for redemption, the place of redemption and the aggregate Redemption
Price, and shall state that payment of the Redemption Price will be made upon
surrender of this Warrant at such place of redemption, and that if not exercised
by the close of business on the date fixed for redemption, the exercise rights
of the Warrant shall expire unless extended by the Company.  Such
notice shall also state the current Exercise Price and the date on which the
right to exercise the Warrant will expire unless extended by the
Company.


    
      
         


      

      
        4

        
          

        

      

      
         


      

    


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

     

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

     

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

     

    7.           Limited
Transferability.  The Holder represents that by accepting this
Warrant it understands that this Warrant and any securities obtainable upon
exercise of this Warrant have not been registered for sale under Federal or
state securities laws and are being offered and sold to the Holder pursuant to
one or more exemptions from the registration requirements of such securities
laws.  In the absence of an effective registration of such securities
or an exemption therefrom, any certificates for such securities shall bear the
legend set forth on the first page hereof.  The Holder understands
that it must bear the economic risk of its investment in this Warrant and any
securities obtainable upon exercise of this Warrant for an indefinite period of
time, as this Warrant and such securities have not been registered under Federal
or state securities laws and therefore cannot be sold unless subsequently
registered under such laws, unless an exemption from such registration is
available.

     

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

     

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


    
      
         


      

      
        5

        
          

        

      

      
         


      

    


    10.         Governing
Law.  This Warrant shall be construed and enforced in
accordance with, and the rights of the parties shall be governed by, the laws of
the State of New York without regard to the conflicts of laws provisions
thereof.

     

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

     

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

     

    13.         Successors and
Assigns.  This Warrant and the rights evidenced hereby shall
inure to the benefit of and be binding upon the successors of the Company and
the successors and assigns of the Holder.

     

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

     

    Remainder
of Page Intentionally Left Blank; Signature Page Follows


    
      
         


      

      
        6

        
          

        

      

      
         


      

    


    IN WITNESS WHEREOF, the
Company has caused this Warrant to be duly executed by its officer, thereunto
duly authorized as of this 1st day of
June, 2009.

     

    
      
        
          	
                  VENTRUS
      BIOSCIENCES, INC.

                	 
	 
      	 
	
                  By:

                	
                  /s/ Timothy M. Hofer

                	 
	
                  Name:  

                	
                  Timothy
      M. Hofer

                	 
	
                  Title:

                	
                  Authorized
      Signatory

                	 


        

      

    

    


    Signature
Page _____ Common Stock Warrant


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    


    FORM
OF SUBSCRIPTION

     

    (To be
signed only upon exercise of Warrant)

     

    To:         [COMPANY
NAME]

     

    The
undersigned, the holder of the attached Common Stock Warrant, hereby elects to
exercise the purchase right represented by such Warrant for, and to purchase
thereunder, ____________________ shares of Common Stock of [COMPANY NAME] and
such holder herewith makes payment of $________ therefor.

     

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

    delivered
to:  
_________________________________________________________________________________________

    whose
address is: 
_____________________________________________________________________________________

     

    DATED:                                                      

     

    
      
        
          	 
      
	
                  (Signature
      must conform in all respects to name of

                  Holder
      as specified on the face of the Warrant)

                
	 
      
	
                  Name:

                	
                       

                
	 
      	 
      
	
                  Title:

                	
                       

                


        

      

    


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

    


    VENTRUS
BIOSCIENCES, INC.

    COMMON
STOCK WARRANT

     

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

     

    This
certifies that PARAMOUNT CREDIT
PARTNERS, LLC (the “Holder”), its
designees or permitted assigns, subject to the terms and conditions set forth
herein, at any time after the Commencement Date and prior to the Expiration Date
(as such terms are defined below), is entitled to purchase from VENTRUS BIOSCIENCES, INC., a
Delaware corporation (the “Company”), that
number of fully-paid and non-assessable shares (subject to adjustment as
provided herein) (the “Warrant Shares”) of
the Company’s Common Stock, $0.001 par value per share (the “Common Stock”), equal
to (i) forty percent (40%) of the principal amount of that certain Senior 10%
Promissory Note dated the date hereof in the principal amount of $123,000,
issued by the Company to the Holder (the “Note”) pursuant to
that certain Note and Warrant Purchase Agreement dated the date hereof between
the Company and the Holder (the “Purchase Agreement”),
divided by (ii) the lowest price at which equity securities of the Company are
sold in the first Qualified Financing (as defined in the Note) following the
date hereof (the “Lowest Price Paid”),
upon surrender to the Company at its principal office (or at such other location
as the Company may advise the Holder in writing) of this Warrant properly
endorsed with the Form of Subscription attached hereto duly completed and signed
and upon payment of the aggregate Exercise Price (as defined below) for the
number of Warrant Shares for which this Warrant is being exercised determined in
accordance with the provisions hereof.  The exercise price (the “Exercise Price”) per
Warrant Share issuable pursuant to this Common Stock Warrant shall be equal to
110% of the Lowest Price Paid, payable in accordance with Section 1(b)
hereof.

     

    Notwithstanding
the foregoing, in the event that the Company consummates a merger, share
exchange, or other transaction (or series of related transactions), other than
in connection with a Qualified Financing, in which (i) the Company merges into
or otherwise becomes a wholly-owned subsidiary of a company subject to the
public company reporting requirements of the Securities Exchange Act of 1934, as
amended, and (ii) the aggregate consideration accorded to the Company in such
transaction(s) (the “Reverse Merger
Consideration”) is greater than or equal to $10,000,000 (a “Reverse Merger”),
then this Warrant shall be exercisable immediately prior to the Reverse Merger
(and subject to Section 3 hereof following the Reverse Merger) for that number
of Warrant Shares, with an Exercise Price, in each case determined in accordance
with, and on the same terms and conditions, as provided for in the event of a
Qualified Financing above, provided that for purposes thereof, the Lowest Price
Paid shall be deemed equal to the quotient obtained by dividing the (i) Reverse
Merger Consideration less the amount of unpaid principal and accrued interest
under the Note by (ii) the number of shares of Common Stock outstanding
immediately prior to such Reverse Merger, on a fully diluted basis, but without
giving effect to the conversion of the Notes or any other senior promissory
notes of the Company or any placement warrants that have been issued by the
Company issued to the Placement Agent (as defined in the Purchase
Agreement).  If any Reverse Merger Consideration is other than cash,
its value will be deemed to be its fair market value as determined, in good
faith, by the Board of Directors of the Company.


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    


    Notwithstanding
the foregoing, if neither a Qualified Financing nor a Reverse Merger occur on or
before June 24, 2011, then this Warrant will be exercisable for that number of
Warrant Shares equal to forty percent (40%) of the principal amount of the Note
purchased by the original holder divided by $1.00, at a per share exercise price
of $1.00.

     

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

     

    1.           Exercise, Issuance of
Certificates.  Subject to Sections 3(d) and 4 hereof, the
Holder may exercise this Warrant, at any time or from time to time, during the
period (a) commencing on the consummation of a Qualified Financing or a Reverse
Merger (the “Commencement
Date”), and (b)
expiring at 5:00 p.m. (Eastern Time) on June 24, 2014 (the “Expiration Date”).  The Holder may
exercise this Warrant on or prior to the Expiration Date for all or any part of
the Warrant Shares (but not for a fraction of a share) that may be purchased
hereunder, as that number may be adjusted pursuant to Section 3 of this
Warrant.  The Company agrees that the Warrant Shares purchased under
this Warrant shall be and are deemed to be issued to the Holder hereof as the
record owner of such Warrant Shares as of the close of business on the date on
which this Warrant shall have been surrendered, properly endorsed, the completed
and executed Form of Subscription delivered, and payment made for such Warrant
Shares (such date, a “Date of Exercise”).  Certificates for
the Warrant Shares so purchased, together with any other securities or property
to which the Holder hereof is entitled upon such exercise, shall be delivered to
the Holder hereof by the Company at the Company’s expense as soon as practicable
after the rights represented by this Warrant have been so exercised, but in any
event not later than ten (10) business days following the Date of
Exercise.  In case of a purchase of less than all the Warrant Shares
which may be purchased under this Warrant, the Company shall cancel this Warrant
and execute and deliver to the Holder hereof within a reasonable time a new
Warrant or Warrants of like tenor for the balance of the Warrant Shares
purchasable under the Warrant surrendered upon such purchase.  Each
stock certificate so delivered shall be registered in the name of such Holder
and issued with a legend in substantially the form of the legend placed on the
front of this Warrant.

     

    (a)           The
Company’s obligations to issue and deliver Warrant Shares in accordance with the
terms hereof are absolute and unconditional, irrespective of any action or
inaction by the Holder to enforce the same.  Nothing herein
shall limit a Holder’s right to pursue any other remedies available to it
hereunder, at law or in equity including, without limitation, a decree of
specific performance and/or injunctive relief with respect to the Company’s
failure to timely deliver certificates representing shares of Common Stock upon
exercise of the Warrant as required pursuant to the terms hereof.

     

    (b)           Payment of Exercise
Price.  The Holder shall
pay the Exercise Price by delivering immediately available funds to the
Company.


    
      
         


      

      
        2

        
          

        

      

      
         


      

    


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

     

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

     

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

     

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


    
      
         


      

      
        3

        
          

        

      

      
         


      

    


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

     

    (d)           Termination Upon a Sale of
the Company.  Notwithstanding any other provision of this
Section 3, upon the consummation of a Sale of the Company (as defined in the
Note) prior to, but not in connection with, a Qualified Financing or Reverse
Merger, this Warrant shall terminate immediately upon such consummation without
the opportunity for exercise.  “Sale of the Company” shall mean a
transaction (or series of related transactions) with one or more non-affiliates,
pursuant to which such party or parties acquire (x) capital stock of the Company
or the surviving entity possessing the voting power to elect a majority of the
Board of Directors of the Company or the surviving entity (whether by merger,
consolidation, sale or transfer of the Company’s capital stock or otherwise); or
(y) all or substantially all of the Company’s assets determined on a
consolidated basis.

     

    4.           Redemption of
Warrants.

     

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

     

    (b)           Notice of
Redemption.  In the case of any redemption of this Warrant, the
Company shall give notice of such redemption to the Holder hereof as provided in
this Section 4(b).  Notice of redemption to the Holder of this Warrant
shall be given in person, by recognized overnight courier, mailed by certified
or registered mail, return receipt requested, or by confirmed facsimile
transmission, to the Holder’s last address and/or facsimile of record with the
Company not less than twenty (20) days prior to the date fixed for
redemption.  Any notice which is given in the manner herein provided
shall be conclusively presumed to have been duly given, whether or not the
Holder receives the notice.  Each such notice shall specify the date
fixed for redemption, the place of redemption and the aggregate Redemption
Price, and shall state that payment of the Redemption Price will be made upon
surrender of this Warrant at such place of redemption, and that if not exercised
by the close of business on the date fixed for redemption, the exercise rights
of the Warrant shall expire unless extended by the Company.  Such
notice shall also state the current Exercise Price and the date on which the
right to exercise the Warrant will expire unless extended by the
Company.


    
      
         


      

      
        4

        
          

        

      

      
         


      

    


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

     

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

     

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

     

    7.           Limited
Transferability.  The Holder represents that by accepting this
Warrant it understands that this Warrant and any securities obtainable upon
exercise of this Warrant have not been registered for sale under Federal or
state securities laws and are being offered and sold to the Holder pursuant to
one or more exemptions from the registration requirements of such securities
laws.  In the absence of an effective registration of such securities
or an exemption therefrom, any certificates for such securities shall bear the
legend set forth on the first page hereof.  The Holder understands
that it must bear the economic risk of its investment in this Warrant and any
securities obtainable upon exercise of this Warrant for an indefinite period of
time, as this Warrant and such securities have not been registered under Federal
or state securities laws and therefore cannot be sold unless subsequently
registered under such laws, unless an exemption from such registration is
available.

     

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

     

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


    
      
         


      

      
        5

        
          

        

      

      
         


      

    


    10.         Governing
Law.  This Warrant shall be construed and enforced in
accordance with, and the rights of the parties shall be governed by, the laws of
the State of New York without regard to the conflicts of laws provisions
thereof.

     

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

     

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

     

    13.         Successors and
Assigns.  This Warrant and the rights evidenced hereby shall
inure to the benefit of and be binding upon the successors of the Company and
the successors and assigns of the Holder.

     

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

     

    Remainder
of Page Intentionally Left Blank; Signature Page Follows


    
      
         


      

      
        6

        
          

        

      

      
         


      

    
  

    IN WITNESS WHEREOF, the
Company has caused this Warrant to be duly executed by its officer, thereunto
duly authorized as of this 24th day of
June, 2009.

     

    
      
        
          	
                  VENTRUS
      BIOSCIENCES, INC.

                	 
	 
      	 
	
                  By:

                	
                  /s/ Thom Rowland

                	 
	
                  Name:  

                	
                  Thom
      Rowland

                	 
	
                  Title:

                	
                  President

                	 


        

      

    

    


    Signature
Page _____ Common Stock Warrant


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    


    FORM
OF SUBSCRIPTION

     

    (To be
signed only upon exercise of Warrant)

     

    To:        [COMPANY
NAME]

     

    The
undersigned, the holder of the attached Common Stock Warrant, hereby elects to
exercise the purchase right represented by such Warrant for, and to purchase
thereunder, ____________________ shares of Common Stock of [COMPANY NAME] and
such holder herewith makes payment of $_______ therefor.

     

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

    delivered
to:  
_________________________________________________________________________________________

    whose
address is: 
_____________________________________________________________________________________

    


    DATED:                                                      

     

    
      
        
          	 
      
	
                  (Signature
      must conform in all respects to name of

                  Holder
      as specified on the face of the Warrant)

                
	 
      
	
                  Name:  

                	
                     

                
	 
      	 
      
	
                  Title: