[FORM OF WARRANT]


 


THIS WARRANT AND THE SECURITIES ISSUABLE
UPON THE EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THEY MAY NOT BE SOLD, OFFERED FOR
SALE, PLEDGED, HYPOTHECATED, OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT REGISTRATION IS NOT REQUIRED UNDER SUCH ACT
OR UNLESS SOLD PURSUANT TO RULE 144 UNDER SUCH ACT.


 


Date of Issuance:Void after:


 


_________, 2012________, 2015


 


 


EMMAUS LIFE SCIENCES, INC.


 


Warrant to
Purchase Shares of


Common Stock


 


FOR VALUE RECEIVED,
_____________ (“Holder”), is entitled to purchase from the Company, subject to the provisions of this Warrant
(“Warrant”), from Emmaus Life Sciences, Inc., a Delaware corporation (“Company”), at any
time not later than 5:00 P.M., Pacific Time on ________, 2015 (the “Expiration Date”), ______ shares (the “Warrant
Shares”) of the Company’s Common Stock, par value $0.001 per share (“Common Stock”) at a price
per share equal to $1.00 (the “Exercise Price”). The Exercise Price and the number of Warrant Shares purchasable upon
exercise of this Warrant shall be subject to adjustment from time to time as described herein.


 


1.                 
Method of Exercise.


 


(a)               
Subject to compliance with the terms and conditions of this Warrant and applicable securities laws, this Warrant
may be exercised, in whole or in part at any time or from time to time, on or before the Expiration Date by the delivery (including,
without limitation, delivery by facsimile) of the form of Notice of Exercise attached hereto as Exhibit A (the
“Notice of Exercise”), duly executed by the Holder, at the principal office of the Company, and as soon as practicable
after such date, surrendering:


 


(i)                
this Warrant at the principal office of the Company, and


 


(ii)              
payment, (i) in cash (by check) or by wire transfer, (ii) by cancellation by the Holder of indebtedness
of the Company to the Holder; or (iii) by a combination of (i) and (ii), of an amount equal to the product obtained by multiplying
the number of shares of Common Stock being purchased upon such exercise by the then effective Exercise Price (the “Exercise
Amount”):


 






    	



    	 



    
 


(b)              
Each exercise of this Warrant shall be deemed to have been effected immediately prior to the close of business on
the day on which this Warrant is surrendered to the Company as provided above. The person or persons entitled to receive the Warrant
Shares issuable upon exercise of this Warrant shall be treated for all purposes as the holder of record of such Warrant Shares
as of the close of business on the date the Holder is deemed to have exercised this Warrant.


 


(c)               
As soon as practicable after the exercise of this Warrant in whole or in part, the Company at its expense will cause
to be issued in the name of, and delivered to, the Holder, or as such Holder (upon payment by such Holder of any applicable transfer
taxes) may direct:


 


(i)                
a certificate or certificates for the number of Warrant Shares to which such Holder shall be entitled, and


 


(ii)              
in case such exercise is in part only, a new warrant or warrants (dated the date hereof) of like tenor, calling in
the aggregate on the face or faces thereof for the number of Shares equal to the number of such Warrant Shares described in this
Warrant minus the number of such Warrant Shares purchased by the Holder upon all exercises made in accordance with this Section
1.


 


2.                 
Representations and Warranties of the Company.


 


In connection with
the transactions provided for herein, the Company hereby represents and warrants to the Holder that:


 


(a)               
Organization, Good Standing, and Qualification. The Company is a corporation duly organized, validly existing,
and in good standing under the laws of the State of Delaware and has all requisite corporate power and authority to carry on its
business as now conducted. The Company is duly qualified to transact business and is in good standing in each jurisdiction in which
the failure to so qualify would have a material adverse effect on its business or properties.


 


(b)              
Authorization. Except as may be limited by applicable bankruptcy, insolvency, reorganization or similar laws
relating to or affecting the enforcement of creditors’ rights, all corporate action has been taken on the part of the Company,
its officers and directors necessary for the authorization, execution and delivery of this Warrant. The Company has taken all corporate
action required to make all the obligations of the Company reflected in the provisions of this Warrant the valid and enforceable
obligations they purport to be. The issuance of this Warrant will not be subject to preemptive rights of any stockholders of the
Company. The Company has authorized sufficient shares of Common Stock to allow for the exercise of this Warrant.


 


3.                  Representations and Warranties of the Holder.


 


In connection with
the transactions provided for herein, the Holder hereby represents and warrants to the Company that:


 


(a)               
Authorization. Holder represents that it has full power and authority to enter into this Warrant. This Warrant
constitutes the Holder’s valid and legally binding obligation, enforceable in accordance with its terms, except as may be
limited by (i) applicable bankruptcy, insolvency, reorganization, or similar laws relating to or affecting the enforcement of creditors’
rights and (ii) laws relating to the availability of specific performance, injunctive relief or other equitable remedies.


 






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(b)              
Purchase Entirely for Own Account. The Holder acknowledges that this Warrant is entered into by the Holder
in reliance upon such Holder’s representation to the Company that the Warrant and the Warrant Shares (collectively, the “Securities”)
will be acquired for investment for the Holder’s own account, not as a nominee or agent, and not with a view to the resale
or distribution of any part thereof, and that the Holder has no present intention of selling, granting any participation in or
otherwise distributing the same. By acknowledging this Warrant, the Holder further represents that the Holder does not have any
contract, undertaking, agreement, or arrangement with any person to sell, transfer or grant participations to such person or to
any third person, with respect to the Securities.


 


(c)               
Disclosure of Information. The Holder acknowledges that it has received all the information it considers necessary
or appropriate for deciding whether to acquire the Securities. The Holder further represents that it has had an opportunity to
ask questions and receive answers from the Company regarding the terms and conditions of the offering of the Securities.


 


(d)              
Investment Experience. The Holder is an investor in securities of companies in the development stage and acknowledges
that it is able to fend for itself, can bear the economic risk of its investment, and has such knowledge and experience in financial
or business matters that it is capable of evaluating the merits and risks of the investment in the Securities. If other than an
individual, the Holder also represents it has not been organized solely for the purpose of acquiring the Securities.


 


(e)               
Accredited Investor. The Holder is an “accredited investor” within the meaning of Rule 501 of
Regulation D, as presently in effect, as promulgated by the Securities and Exchange Commission (the “SEC”) under
the Securities Act of 1933, as amended (the “Act”).


 


(f)               
Restricted Securities. The Holder understands that the Securities are characterized as “restricted securities”
under the federal securities laws inasmuch as they are being acquired from the Company in a transaction not involving a public
offering and that under such laws and applicable regulations such securities may be resold without registration under the Act,
only in certain limited circumstances. In this connection, Holder represents that it is familiar with Rule 144, as presently in
effect, as promulgated by the SEC under the Act (“Rule 144”), and understands the resale limitations imposed
thereby and by the Act.


 


(g)              
Further Limitations on Disposition. The Holder, by acceptance hereof, agrees that, absent an effective registration
statement filed with the SEC under the Act covering the disposition or sale of this Warrant or the Warrant Shares issued or issuable
upon exercise hereof, as the case may be, and registration or qualification under applicable state securities laws, such Holder
will not sell, transfer, pledge, or hypothecate any or all of this Warrant or such Warrant Shares, as the case may be, unless either
(i) the Company has received an opinion of counsel, in form and substance reasonably satisfactory to the Company, to the effect
that such registration is not required in connection with such disposition or (ii) the sale of such Securities is made pursuant
to SEC Rule 144.


 






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(h)              
Legends. It is understood that the Securities may bear the following or a similar legend:


 


“THESE SECURITIES HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED, OR OTHERWISE
TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR AN OPINION
OF COUNSEL SATISFACTORY TO THE COMPANY THAT REGISTRATION IS NOT REQUIRED UNDER SUCH ACT OR UNLESS SOLD PURSUANT TO RULE 144 UNDER
SUCH ACT.”


 


4.                 
Valid Issuance; Taxes. All Warrant Shares issued upon the exercise of this Warrant
shall be validly issued, fully paid and nonassessable, and the Company shall pay all taxes and other governmental charges that
may be imposed in respect of the issue or delivery thereof. The Company shall not be required to pay any tax or other charge imposed
in connection with any transfer involved in the issuance of any certificate for Warrant Shares in any name other than that of the
Holder of this Warrant, and in such case the Company shall not be required to issue or deliver any stock certificate or security
until such tax or other charge has been paid, or it has been established to the Company’s reasonable satisfaction that no
tax or other charge is due.


 


5.                 
Adjustment of Exercise Price and Number and Kind of Warrant Shares. The number
and kind of Warrant Shares purchasable upon exercise of this Warrant and the Exercise Price shall be subject to adjustment from
time to time as follows:


 


(a)               
Subdivisions, Combinations and Other Issuances. If the Company shall at any time after the issuance but prior
to the expiration of this Warrant subdivide its Common Stock, by split-up or otherwise, or combine its Common Stock, or issue additional
shares of its Common Stock as a dividend with respect to any shares of its Common Stock, the Exercise Price shall be proportionally
decreased and the number of Warrant Shares issuable on the exercise of this Warrant shall be proportionately increased in the case
of a subdivision or stock dividend. The Exercise Price shall be proportionally increased and the number of Warrant Shares issuable
on the exercise of this Warrant shall be proportionately decreased in the case of a combination. Any adjustment under this Section
5(a) shall become effective at the close of business on the date the subdivision or combination becomes effective, or as of the
record date of such dividend, or in the event that no record date is fixed, upon the making of such dividend.


 






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(b)              
Reclassification, Reorganization and Consolidation. In case of any reclassification, capital reorganization
or change in the capital stock of the Company (other than as a result of a subdivision, combination or stock dividend provided
for in Section 5(a) above), then, as a condition of such reclassification, reorganization or change, lawful provision shall be
made, and duly executed documents evidencing the same from the Company or its successor shall be delivered to the Holder, so that
the Holder shall have the right at any time prior to the expiration of this Warrant to purchase, at a total price equal to that
payable upon the exercise of this Warrant, the kind and amount of shares of stock and other securities or property receivable in
connection with such reclassification, reorganization or change by a holder of the same number and type of securities as were purchasable
as Warrant Shares by the Holder immediately prior to such reclassification, reorganization or change. In any such case appropriate
provisions shall be made with respect to the rights and interest of the Holder so that the provisions hereof shall thereafter be
applicable with respect to any shares of stock or other securities or property deliverable upon exercise hereof, and appropriate
adjustments shall be made to the per-share Exercise Price payable hereunder, provided the aggregate Exercise Price shall remain
the same.


 


(c)               
Notice of Adjustment. When any adjustment is required to be made in the number or kind of Warrant Shares purchasable
upon exercise of the Warrant, or in the Exercise Price, the Company shall promptly notify the Holder of such event and of the new
Exercise Price and number of Warrant Shares or other securities or property thereafter purchasable upon exercise of this Warrant.


 


6.            No Fractional
Shares or Scrip.


 


No fractional shares
or scrip representing fractional shares shall be issued upon the exercise of this Warrant, but in lieu of such fractional shares
the Company shall make a cash payment therefor on the basis of the Exercise Price then in effect.


 


7.            No Stockholder
Rights.


 


Prior to exercise of
this Warrant, the Holder shall not be entitled to any rights of a stockholder with respect to the Warrant Shares, including (without
limitation) the right to vote such Warrant Shares, receive dividends or other distributions thereon, exercise preemptive rights
or be notified of stockholder meetings, and, except as otherwise provided in this Warrant, such Holder shall not be entitled to
any stockholder notice or other communication concerning the business or affairs of the Company.


 


8.
           Restrictions on Transfer.


 


As provided herein,
this Warrant may be transferred only pursuant to a registration statement filed under the Act, or an exemption from such registration.
Subject to such restrictions, the Company shall transfer this Warrant from time to time upon the books to be maintained by the
Company for that purpose, upon surrender hereof for transfer, properly endorsed or accompanied by appropriate instructions for
transfer and such other documents as may be reasonably required by the Company, including, if required by the Company, an opinion
of its counsel to the effect that such transfer is exempt from the registration requirements of the Act, to establish that such
transfer is being made in accordance with the terms hereof, and a new Warrant shall be issued to the transferee and the surrendered
Warrant shall be canceled by the Company.


 






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9.            Governing
Law; Consent to Jurisdiction; Waiver of Jury Trial.


 


This Warrant shall
be governed by and construed under the laws of the State of California as applied to agreements among California residents, made
and to be performed entirely within the State of California. The Company and, by accepting this Warrant, the Holder, each irrevocably
submits to the exclusive jurisdiction of the courts of the State of California located in Los Angeles County and the United States
District Court for the Central District of California for the purpose of any suit, action, proceeding or judgment relating to or
arising out of this Warrant and the transactions contemplated hereby. Service of process in connection with any such suit, action
or proceeding may be served on each party hereto anywhere in the world by the same methods as are specified for the giving of notices
under this Warrant. The Company and, by accepting this Warrant, the Holder, each irrevocably consents to the jurisdiction of any
such court in any such suit, action or proceeding and to the laying of venue in such court. The Company and, by accepting this
Warrant, the Holder, each irrevocably waives any objection to the laying of venue of any such suit, action or proceeding brought
in such courts and irrevocably waives any claim that any such suit, action or proceeding brought in any such court has been brought
in an inconvenient forum.  EACH OF THE COMPANY AND, BY ITS ACCEPTANCE HEREOF, THE HOLDER HEREBY WAIVES ANY RIGHT TO REQUEST
A TRIAL BY JURY IN ANY LITIGATION WITH RESPECT TO THIS WARRANT AND REPRESENTS THAT COUNSEL HAS BEEN CONSULTED SPECIFICALLY AS TO
THIS WAIVER.


 


10.
            Successors and Assigns.


 


The terms and provisions
of this Warrant shall inure to the benefit of, and be binding upon, the Company and the holders hereof and their respective successors
and assigns.


 


11.             Titles
and Subtitles.


 


The titles and subtitles
used in this Warrant are used for convenience only and are not to be considered in construing or interpreting this Warrant.


 


12.
            Notices.


 


Unless otherwise provided,
any notice required or permitted under this Warrant shall be given in writing and shall be deemed effectively given as hereinafter
described (a) if given by personal delivery, then such notice shall be deemed given upon such delivery, (b) if given by telex or
facsimile, then such notice shall be deemed given upon receipt of confirmation of complete transmittal, (c) if given by mail, then
such notice shall be deemed given upon the earlier of (i) receipt of such notice by the recipient or (ii) three days after such
notice is deposited in first class mail, postage prepaid, and (d) if given by an internationally recognized overnight air courier,
then such notice shall be deemed given one business day after delivery to such carrier. All notices shall be addressed as follows:
if to the Holder, at its address as set forth in the Company’s books and records and, if to the Company, at the address as
follows, or at such other address as the Holder or the Company may designate by ten days’ advance written notice to the other:


 


If to the Company:


Emmaus Life Sciences,
Inc.


20725 South Western
Avenue, Suite 136


Torrance, CA 90501


Attn: Yasushi Nagasaki,
Chief Financial Officer


Fax: (310) 214-0075






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With a copy to:


K&L Gates


10100 Santa Monica
Boulevard Seventh Floor


Los Angeles, CA 90067


Attn: Katherine J.
Blair


Fax: (310) 552-5001


 


 


13.
             Expenses.


 


If any action at law
or in equity is necessary to enforce or interpret the terms of this Warrant, the prevailing party shall be entitled to reasonable
attorneys’ fees, costs and necessary disbursements in addition to any other relief to which such party may be entitled.


 


14.              Entire
Agreement; Amendments and Waivers.


 


This Warrant and any
other documents delivered pursuant hereto constitute the full and entire understanding and agreement between the parties with regard
to the subjects hereof and thereof. Nonetheless, any term of this Warrant may be amended and the observance of any term of this
Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively), with the written
consent of the Company and the Holder; or if this Warrant has been assigned in part, by the holders or rights to purchase a majority
of the shares originally issuable pursuant to this Warrant.


 


15.              Severability.


 


If any provision of
this Warrant is held to be unenforceable under applicable law, such provision shall be excluded from this Warrant and the balance
of the Warrant shall be interpreted as if such provision were so excluded and shall be enforceable in accordance with its terms.


 






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IN WITNESS WHEREOF,
the parties have executed this Warrant as of the date above written.


 


 


EMMAUS LIFE SCIENCES, INC.


 





 


By:  /s/ Yutaka Niihara


Name: Yutaka Niihara, M.D., M.P.H.


Title: President and Chief Executive
Officer


 


 



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EXHIBIT A


 


Notice of
Exercise


 


EMMAUS LIFE SCIENCES, INC.


 


Attention: Chief Financial Officer


 


The undersigned hereby
elects to purchase, pursuant to the provisions of the Warrant, as follows:


 


                                              shares
of Common Stock pursuant to the terms of the attached Warrant at $_______ per share (the applicable Exercise Price as of the date
of this Notice of Exercise) , and tenders herewith payment in cash of the Exercise Price of such Warrant Shares in full, together
with all applicable transfer taxes, if any.


 


The undersigned hereby
represents and warrants that Representations and Warranties in Section 3 of the Warrant are true and correct as of the date hereof.


 


 


 


HOLDER:


 





	Date:	 	By: 	 
	 	 	Name: 	 
	 	 	Address: 	 
	 	 	 	 
	 	 	 	 







 


 


 


Name in which shares should be registered:


 






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[INFORMATION FOR PURPOSES OF FILING WITH THE SECURITIES AND EXCHANGE
COMMISSION]


 


SCHEDULE A


 


WARRANTHOLDERS


 


	Holder	Issuance Date	Expiration Date	
        No. of

        Warrant Shares

	Lan T. Tran	2/10/2012	2/10/2015	56,945
	Tracey & Mark Doi	2/10/2012	2/10/2015	30,000
	Shigeru Matsuda	2/10/2012	2/10/2015	231,482
	Hideki & Eiko Uehara	2/15/2012	2/15/2015	37,037


  


 



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