Unassociated Document


    Exhibit
4.13

    


    Form
of Underwriters’ Warrant Agreement

     

    THE
REGISTERED HOLDER OF THIS WARRANT BY ITS ACCEPTANCE HEREOF, AGREES THAT IT WILL
NOT SELL, TRANSFER OR ASSIGN THIS WARRANT EXCEPT AS HEREIN PROVIDED AND THE
REGISTERED HOLDER OF THIS WARRANT AGREES THAT IT WILL NOT SELL, TRANSFER,
ASSIGN, PLEDGE OR HYPOTHECATE THIS WARRANT FOR A PERIOD OF ONE HUNDRED EIGHTY
DAYS FOLLOWING THE EFFECTIVE DATE (DEFINED BELOW) TO ANYONE OTHER THAN (I)
RODMAN & RENSHAW, LLC, NATIONAL SECURITIES CORPORATION OR AN
UNDERWRITER OR A SELECTED DEALER IN CONNECTION WITH THE OFFERING, OR (II) A BONA
FIDE OFFICER OR PARTNER OF RODMAN & RENSHAW, LLC, NATIONAL SECURITIES
CORPORATION OR OF ANY SUCH UNDERWRITER OR SELECTED DEALER.

     

    THIS
WARRANT IS NOT EXERCISABLE PRIOR TO ________________ [DATE THAT IS ONE YEAR FROM DATE OF
PROSPECTUS].  VOID
AFTER 5:00 P.M. EASTERN TIME, ___________________ [DATE THAT IS FIVE YEARS THE
FROM DATE OF THE PROSPECTUS].

     

    COMMON
STOCK PURCHASE WARRANT

     

    For the
Purchase of Shares of Common Stock

    Of

    VENTRUS
BIOSCIENCES, INC.

     

    1.           Warrant.  THIS
CERTIFIES THAT, in consideration of funds duly paid by or on behalf of
[         ]("Holder"), as
registered owner of this Warrant, to Ventrus Biosciences, Inc. (the "Company"),
Holder is entitled, at any time or from time to time from ________________ [DATE
THAT IS ONE YEAR FROM DATE OF PROSPECTUS] (the "Commencement Date"), and at or
before 5:00 p.m., Eastern Time, ___________________ [DATE THAT IS FIVE YEARS THE
FROM DATE OF THE PROSPECTUS] (the "Expiration Date"), but not
thereafter, to subscribe for, purchase and receive, in whole or in part, up to
[____] shares of common stock of the Company, par value $.001 per share (the
"Shares"), subject to adjustment as provided in Section 6 hereof. If the
Expiration Date is a day on which banking institutions are authorized by law to
close, then this Warrant may be exercised on the next succeeding day which is
not such a day in accordance with the terms herein.  During the period
ending on the Expiration Date, the Company agrees not to take any action that
would terminate the Warrant.  This Warrant is initially exercisable at
$[________] per Share (125% of the price of the Shares sold in the Offering);
provided, however, that upon the occurrence of any of the events specified in
Section 6 hereof, the rights granted by this Warrant, including the exercise
price per Share and the number of Shares to be received upon such exercise,
shall be adjusted as therein specified.  The term "Exercise Price" shall
mean the initial exercise price or the adjusted exercise price, depending on the
context.


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

     

    2.           Exercise.

     

    2.1           Exercise Form.
 In order to exercise this Warrant, the exercise form attached hereto must
be duly executed and completed and delivered to the Company, together with this
Warrant and payment of the Exercise Price for the Shares being purchased payable
in cash by wire transfer of immediately available funds to an account designated
by the Company or by certified check or official bank check.  If the
subscription rights represented hereby shall not be exercised at or before 5:00
p.m., Eastern time, on the Expiration Date, this Warrant shall become and be
void without further force or effect, and all rights represented hereby shall
cease and expire.

     

    2.2           Cashless
Exercise.  In
lieu of exercising this Warrant by payment of cash or certified check
or official bank check payable to the order of the Company pursuant to Section
2.1 above, Holder may elect to receive the number of Shares equal to the value
of this Warrant (or the portion thereof being
exercised), by surrender of this Warrant to the Company, together with the
exercise form attached hereto, in which event the issue to Holder, Shares
in accordance with the following formula:

    


    
      
        
          	 
      	 
      	
                  Y(A-B)

                
	
                  X

                	
                  =

                	
                  A

                


        

      

    

    
      
        	
                Where,

              	
                X

              	
                =

              	
                The
      number of Shares to be issued to Holder;

              
	 
      	
                Y

              	
                =

              	
                The
      number of Shares for which the Warrant is being
  exercised;

              
	 
      	
                A

              	
                =

              	
                The
      fair market value of one Share; and

              
	 
      	
                B

              	
                =

              	
                The
      Exercise Price.

              


      

    

     

    For purposes of this Section 2.2, the
fair market value of a Share is defined as follows:

     

    (i)       
    if the Company’s common stock is traded on a securities
exchange, the value shall be deemed to be the average of the closing prices on
such exchange or market over the thirty (30) day period ending three (3) days
prior to the date of the exercise form being submitted in connection with the
exercise of the Warrant; or

     

    (ii)           if
the Company’s common stock is actively traded over-the-counter, the value shall
be deemed to be the average of the closing bid prices over the thirty (30) day
period ending three (3) days prior to the date of the exercise form being
submitted in connection with the exercise of the Warrant; if there is no active
public market, the value shall be the fair market value thereof, as determined
in good faith by the Company’s Board of Directors.

     

    2.3           Legend.  Each
certificate for the securities purchased under this Warrant shall bear a legend
as follows unless such securities have been registered under the Securities Act
of 1933, as amended (the "Act"):


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

     

    "The
securities represented by this certificate have not been registered under the
Securities Act of 1933, as amended (the "Act") or applicable state law.
 Neither the securities nor any interest therein may be offered for sale,
sold or otherwise transferred except pursuant to an effective registration
statement under the Act, or pursuant to an exemption from registration under the
Act and applicable state law which, in the opinion of counsel to the Company, is
available."

     

    3.           Transfer.

     

    3.1           General Restrictions.
 The registered Holder of this Warrant agrees by his, her or its acceptance
hereof, that such Holder will not: (a) sell, transfer, assign, pledge
or  hypothecate this Warrant for a period of one hundred eighty (180)
days following the effective date (“the Effective Date”) of the Company’s
registration statement on Form S-1 (No. 333-168224) (the “Registration
Statement”) to anyone other than: (i) Rodman & Renshaw, LLC ("Rodman &
Renshaw"), National Securities Corporation (“National Securities”) or an
underwriter or a selected dealer participating in the Offering, or (ii) a bona
fide officer or partner of Rodman & Renshaw or National Securities or of any
such underwriter or selected dealer, in each case in accordance with FINRA
Conduct Rule 5110(g)(1), or (b) cause this Warrant or the securities issuable
hereunder to be the subject of any hedging, short sale, derivative, put or call
transaction that would result in the effective economic disposition of this
Warrant or the securities hereunder, except as provided for in FINRA Rule
5110(g)(2). On and after 180 days from the Effective Date, transfers to others
may be made subject to compliance with or exemptions from applicable securities
laws.  In order to make any permitted assignment, the Holder must deliver
to the Company the assignment form attached hereto duly executed and completed,
together with the Warrant and payment of all transfer taxes, if any, payable in
connection therewith.  The Company shall within five (5) business days
transfer this Warrant on the books of the Company and shall execute and deliver
a new Warrant or Warrants of like tenor to the appropriate assignee(s) expressly
evidencing the right to purchase the aggregate number of Shares purchasable
hereunder or such portion of such number as shall be contemplated by any such
assignment.

     

    3.2           Restrictions Imposed by the
Act.  The securities evidenced by this Warrant shall not be
transferred unless and until: (i) the Company has received the opinion of
counsel for the Holder that the securities may be transferred pursuant to an
exemption from registration under the Act and applicable state securities laws,
the availability of which is established to the reasonable satisfaction of the
Company (the Company hereby agreeing that the opinion of Littman Krooks LLP
(“Littman Krooks”) shall be deemed satisfactory evidence of the availability of
an exemption), or (ii) a registration statement or a post-effective amendment to
the registration statement relating to the offer and sale of such securities has
been filed by the Company and declared effective by the Securities and Exchange
Commission (the "Commission") and compliance with applicable state
securities law has been established.


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

     

    4.           Registration
Rights.

     

    4.1           Demand
Registration.

     

    4.1.1        Grant of Right.
 The Company, upon written demand (a "Demand Notice") of the Holder(s) of
at least 51% of the Warrants and/or the underlying Shares ("Majority Holders"),
agrees to register, on one occasion, all or any portion of the Shares underlying
the Warrants (collectively the "Registrable Securities"). On such occasion, the
Company will file a registration statement with the SEC covering the Registrable
Securities within sixty (60) days after receipt of a Demand Notice and use its
reasonable best efforts to have the registration statement declared effective
promptly thereafter, subject to compliance with review by the SEC; provided,
however, that the Company shall not be required to comply with a Demand Notice
if the Company has filed a registration statement with respect to which the
Holder is entitled to piggyback registration rights pursuant to Section 4.2
hereof and either: (i) the Holder has elected to participate in the offering
covered by such registration statement or (ii) if such registration statement
relates to an underwritten primary offering of securities of the Company, until
the offering covered by such registration statement has been withdrawn or until
thirty (30) days after such offering is consummated. The demand for registration
may be made at any time during a period of four (4) years beginning one (1) year
from the Closing Date. The Company covenants and agrees to give written notice
of its receipt of any Demand Notice by any Holder(s) to all other registered
Holders of the Warrants and/or the Registrable Securities within ten (10) days
from the date of the receipt of any such Demand Notice.

     

    4.1.2        Terms.  The
Company shall bear all fees and expenses attendant to the registration of the
Registrable Securities pursuant to Section 4.1.1, but the Holders shall pay any
and all underwriting commissions and the expenses of any legal counsel selected
by the Holders to represent them in connection with the sale of the Registrable
Securities. The Company agrees to use its reasonable best efforts to cause the
filing required herein to become effective promptly and to qualify or register
the Registrable Securities in such states as are reasonably requested by the
Holder(s); provided, however, that in no event shall the Company be required to
register the Registrable Securities in a state in which such registration would
cause: (i) the Company to be obligated to register or license to do business in
such state or submit to general service of process in such state, or (ii) the
principal shareholders of the Company to be obligated to escrow their shares of
capital stock of the Company. The Company shall cause any registration statement
filed pursuant to the demand right granted under Section 4.1.1 to remain
effective for a period of at least twelve (12) consecutive months from the date
that the Holders of the Registrable Securities covered by such registration
statement are first given the opportunity to sell all of such securities.
 The Holders shall only use the prospectuses provided by the Company to
sell the shares covered by such registration statement, and will immediately
cease to use any prospectus furnished by the Company if the Company advises the
Holder that such prospectus may no longer be used due to a material misstatement
or omission.

    


    4.2           "Piggy-Back"
Registration.

     

    4.2.1        Grant of Right.
 In addition to the demand right of registration, described in Section 4.1
hereof the Holder shall have the right, for a period of four (4) years
commencing one (1) year from the Closing Date, to include the Registrable
Securities as part of any other registration of securities filed by the Company
(other than in connection with a transaction contemplated by Rule 145(a)
promulgated under the Act or pursuant to Form S-8 or any equivalent form);
provided, however, that if, solely in connection with any primary underwritten
public offering for the account of the Company, the managing underwriter(s)
thereof shall, in its reasonable discretion, impose a limitation on the number
of shares of Common Stock which may be included in such registration statement
because, in such underwriter(s)' judgment, marketing or other factors dictate
such limitation is necessary to facilitate public distribution, then the Company
shall be obligated to include in such registration statement only such limited
portion of the Registrable Securities with respect to which the Holder requested
inclusion hereunder as the underwriter shall reasonably permit. Any exclusion of
Registrable Securities shall be made pro rata among the Holders seeking to
include Registrable Securities in proportion to the number of Registrable
Securities sought to be included by such Holders; provided, however, that the
Company shall not exclude any Registrable Securities unless the Company has
first excluded all outstanding securities, the holders of which are not entitled
to inclusion of such securities in such registration statement or are not
entitled to pro rata inclusion with the Registrable Securities.


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

     

    4.2.2        Terms. The Company
shall bear all fees and expenses attendant to registering the Registrable
Securities pursuant to Section 4.2.1 hereof, but the Holders shall pay any and
all underwriting commissions and the expenses of any legal counsel selected by
the Holders to represent them in connection with the sale of the Registrable
Securities. In the event of such a proposed registration, the Company shall
furnish the then Holders of outstanding Registrable Securities with not less
than thirty (30) days written notice prior to the proposed date of filing of
such registration statement.  Such notice to the Holders shall continue to
be given for each registration statement filed by the Company until such time as
all of the Registrable Securities have been sold by the Holder.  The
holders of the Registrable Securities shall exercise the "piggy-back" rights
provided for herein by giving written notice within ten (10) days of the receipt
of the Company's notice of its intention to file a registration
statement.

     

    4.3           General
Terms.

     

    4.3.1        Indemnification.  The
Company shall indemnify the Holder(s) of the Registrable Securities to be sold
pursuant to any registration statement hereunder and each person, if any, who
controls such Holders within the meaning of Section 15 of the Act or Section 20
(a) of the Securities Exchange Act of 1934, as amended ("Exchange Act"), against
all loss, claim, damage, expense or liability (including all reasonable
attorneys' fees and other expenses reasonably incurred in investigating,
preparing or defending against any claim whatsoever) to which any of them may
become subject under the Act, the Exchange Act or otherwise, arising from such
registration statement but only to the same extent and with the same effect as
the provisions pursuant to which the Company has agreed to indemnify the
Underwriters contained in Section 5.1 of the Underwriting Agreement between the
Underwriters and the Company, dated as of [_________________]. The Holder(s) of
the Registrable Securities to be sold pursuant to such registration statement,
and their successors and assigns, shall severally, and not jointly, indemnify
the Company, against all loss, claim, damage, expense or liability (including
all reasonable attorneys' fees and other expenses reasonably incurred in
investigating, preparing or defending against any claim whatsoever) to which
they may become subject under the Act, the Exchange Act or otherwise, arising
from information furnished by or on behalf of such Holders, or their successors
or assigns, in writing, for specific inclusion in such registration statement to
the same extent and with the same effect as the provisions contained in Section
5.2 of the Underwriting Agreement pursuant to which the Underwriters have agreed
to indemnify the Company.

     

    4.3.2        Exercise of Warrants.  Nothing
contained in this Warrant shall be construed as requiring the Holder(s) to
exercise their Warrants prior to or after the initial filing of any registration
statement or the effectiveness thereof.


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

     

    4.3.3        Documents Delivered to
Holders.  The Company shall furnish to each Holder participating in
any of the foregoing offerings and to each underwriter of any such offering, if
any, a signed counterpart, addressed to such Holder or underwriter, of (i) an
opinion of counsel to the Company, dated the effective date of such registration
statement (and, if such registration includes an underwritten public offering,
an opinion dated the date of the closing under any underwriting agreement
related thereto), and (ii) a "cold comfort" letter dated the effective date of
such registration statement (and, if such registration includes an underwritten
public offering, a letter dated the date of the closing under the underwriting
agreement) signed by the independent public accountants who have issued a report
on the Company's financial statements included in such registration statement,
in each case covering substantially the same matters with respect to such
registration statement (and the prospectus included therein) and, in the case of
such accountants' letter, with respect to events subsequent to the date of such
financial statements, as are customarily covered in opinions of issuer's counsel
and in accountants' letters delivered to underwriters in underwritten public
offerings of securities. The Company shall also deliver promptly to each Holder
participating in the offering requesting the correspondence and memoranda
described below and to the managing underwriter, if any, copies of all
correspondence between the SEC and the Company, its counsel or auditors and all
memoranda relating to discussions with the SEC or its staff with respect to the
registration statement and permit each Holder and underwriter to do such
investigation, upon reasonable advance notice, with respect to information
contained in or omitted from the registration statement as it deems reasonably
necessary to comply with applicable securities laws or rules of FINRA. Such
investigation shall include access to books, records and properties and
opportunities to discuss the business of the Company with its officers and
independent auditors, all to such reasonable extent and at such reasonable times
as any such Holder shall reasonably request.

     

    4.3.4        Underwriting
Agreement.  The Company shall enter into an underwriting agreement
with the managing underwriter(s), if any, selected by any Holders whose
Registrable Securities are being registered pursuant to this Section 4, which
managing underwriter shall be reasonably satisfactory to the Company.  Such
agreement shall be reasonably satisfactory in form and substance to the Company,
each Holder and such managing underwriters, and shall contain such
representations, warranties and covenants by the Company and such other terms as
are customarily contained in agreements of that type used by the managing
underwriter.  The Holders shall be parties to any underwriting agreement
relating to an underwritten sale of their Registrable Securities and may, at
their option, require that any or all the representations, warranties and
covenants of the Company to or for the benefit of such underwriters shall also
be made to and for the benefit of such Holders. Such Holders shall not be
required to make any representations or warranties to or agreements with the
Company or the underwriters except as they may relate to such Holders, their
Shares and their intended methods of distribution.

     

    4.3.5        Documents to be Delivered by
Holder(s).  Each of the Holder(s) participating in any of the
foregoing offerings shall furnish to the Company a completed and executed
questionnaire provided by the Company requesting information customarily sought
of selling security holders.

     

    4.3.6        Damages.  Should
the registration or the effectiveness thereof required by Sections 4.1 and 4.2
hereof be delayed by the Company or the Company otherwise fails to comply with
such provisions, the Holder(s) shall, in addition to any other legal or other
relief available to the Holder(s), be entitled to obtain specific performance or
other equitable (including injunctive) relief against the threatened breach of
such provisions or the continuation of any such breach, without the necessity of
proving actual damages and without the necessity of posting bond or other
security.


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

     

    5.           New Warrants to be
Issued.

     

    5.1           Partial Exercise or
Transfer.  Subject to the restrictions in Section 3 hereof, this
Warrant may be exercised or assigned in whole or in part.  In the event of
the exercise or assignment hereof in part only, upon surrender of this Warrant
for cancellation, together with the duly executed exercise or assignment form
and funds sufficient to pay any Exercise Price and/or transfer tax if exercised
pursuant to Section 2.1 hereto, the Company shall cause to be delivered to the
Holder without charge a new Warrant of like tenor to this Warrant in the name of
the Holder evidencing the right of the Holder to purchase the number of Shares
purchasable hereunder as to which this Warrant has not been exercised or
assigned.

     

    5.2           Lost
Certificate.  Upon receipt by the Company of evidence
satisfactory to it of the loss, theft, destruction or mutilation of this Warrant
and of reasonably satisfactory indemnification or the posting of a bond, the
Company shall execute and deliver a new Warrant of like tenor and date.
 Any such new Warrant executed and delivered as a result of such loss,
theft, mutilation or destruction shall constitute a substitute contractual
obligation on the part of the Company.

     

    6.           Adjustments.

     

    6.1           Adjustments to Exercise
Price and Number of Securities.  The Exercise Price and the number
of Shares underlying the Warrant shall be subject to adjustment from time to
time as hereinafter set forth:

     

    6.1.1           Share Dividends; Split
Ups.  If after the date hereof, and subject to the provisions of
Section 6.3 below, the number of outstanding Shares is increased by a stock
dividend payable in Shares or by a split up of Shares or other similar event,
then, on the effective day thereof, the number of Shares purchasable hereunder
shall be increased in proportion to such increase in outstanding shares, and the
Exercise Price shall be proportionately decreased.

     

    6.1.2           Aggregation of
Shares.  If after the date hereof, and subject to the provisions of
Section 6.3, the number of outstanding Shares is decreased by a consolidation,
combination or reclassification of Shares or other similar event, then, on the
effective date thereof, the number of Shares purchasable hereunder shall be
decreased in proportion to such decrease in outstanding shares, and the Exercise
Price shall be proportionately increased.


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    


    6.1.3           Replacement of Securities
upon Reorganization, etc.  In case of any reclassification or
reorganization of the outstanding Shares other than a change covered by Section
6.1.1 or 6.1.2 hereof or that solely affects the par value of such Shares, or in
the case of any share reconstruction or amalgamation or consolidation of the
Company with or into another corporation (other than a consolidation or share
reconstruction or amalgamation in which the Company is the continuing
corporation and that does not result in any reclassification or reorganization
of the outstanding Shares), or in the case of any sale or conveyance to another
corporation or entity of the property of the Company as an entirety or
substantially as an entirety in connection with which the Company is dissolved,
the Holder of this Warrant shall have the right thereafter (until the expiration
of the right of exercise of this Warrant) to receive upon the exercise hereof,
for the same aggregate Exercise Price payable hereunder immediately prior to
such event, the kind and amount of shares of stock or other securities or
property (including cash) receivable upon such reclassification, reorganization,
share reconstruction or amalgamation, or consolidation, or upon a dissolution
following any such sale or transfer, by a Holder of the number of Shares of the
Company obtainable upon exercise of this Warrant immediately prior to such
event; and if any reclassification also results in a change in Shares covered by
Section 6.1.1 or 6.1.2, then such adjustment shall be made pursuant to Sections
6.1.1, 6.1.2 and this Section 6.1.3. The provisions of this Section 6.1.3 shall
similarly apply to successive reclassifications, reorganizations, share
reconstructions or amalgamations, or consolidations, sales or other
transfers.

    


    6.1.4            Issuance or Sale of
Additional Securities .  If and whenever the Company issues or
sells any shares of Common Stock for a consideration per share of less than the
then-Exercise Price or for no consideration, or issues or grants any warrants,
rights or options, whether or not immediately exercisable, to subscribe for or
to purchase Common Stock or Common Stock Equivalents (such warrants, rights and
options to purchase Common Stock or Common Stock Equivalents are hereinafter
referred to as “ Options
”) and the effective price per share for which Common Stock is issuable upon the
exercise of such Options is less than the Exercise Price (such issuances are
collectively, a “Dilutive
Issuance”), then the Exercise Price shall be reduced to a price
determined by dividing (i) an amount equal to the sum of (a) the total number of
shares of Common Stock outstanding immediately prior to such issuance or sale
(excluding treasury shares, if any) plus (b) the number of shares of Common
Stock which the consideration, if any, received by the Company upon such
issuance or sale would purchase at the Exercise Price by (ii) the total number
of shares of Common Stock outstanding immediately after such issuance or sale
and multiplying the Exercise Price by such fraction; provided that, for purposes
hereof, all shares of Common Stock that are issuable upon conversion, exercise
or exchange of Common Stock Equivalents shall be deemed outstanding immediately
after the issuance of such Common Stock Equivalents.  Such adjustment shall
be made whenever such shares of Common Stock or Common Stock Equivalents are
issued.

     

    6.1.5           Changes in Form
of Warrant.  This
form of Warrant need not be changed because of any change pursuant to this
Section 6.1, and Warrants issued after such change may state the same Exercise
Price and the same number of Shares as are stated in the Warrants initially
issued pursuant to this Agreement. The acceptance by any Holder of the issuance
of new Warrants reflecting a required or permissive change shall not be deemed
to waive any rights to an adjustment occurring after the Commencement Date or
the computation thereof.

     

    6.2           Substitute Warrant.  In
case of any consolidation of the Company with, or share reconstruction or
amalgamation of the Company with or into, another corporation (other than a
consolidation or share reconstruction or amalgamation which does not result in
any reclassification or change of the outstanding Shares), the corporation
formed by such consolidation or share reconstruction or amalgamation shall
execute and deliver to the Holder a supplemental Warrant providing that the
holder of each Warrant then outstanding or to be outstanding shall have the
right thereafter (until the stated expiration of such Warrant) to receive, upon
exercise of such Warrant, the kind and amount of shares of stock and other
securities and property receivable upon such consolidation or share
reconstruction or amalgamation, by a holder of the number of Shares of the
Company for which such Warrant might have been exercised immediately prior to
such consolidation, share reconstruction or amalgamation, sale or transfer. Such
supplemental Warrant shall provide for adjustments which shall be identical to
the adjustments provided for in this Section 6. The above provision of this
Section shall similarly apply to successive consolidations or share
reconstructions or amalgamations.


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

     

    6.3           Elimination of Fractional
Interests.  The Company shall not be required to issue certificates
representing fractions of Shares upon the exercise of the Warrant, nor shall it
be required to issue scrip or pay cash in lieu of any fractional interests, it
being the intent of the parties that all fractional interests shall be
eliminated by rounding any fraction up or down, as the case may be, to the
nearest whole number of Shares or other securities, properties or
rights.

     

    7.           Reservation and
Listing.  The Company shall at all times reserve and keep available
out of its authorized Shares, solely for the purpose of issuance upon exercise
of the Warrants, such number of Shares or other securities, properties or rights
as shall be issuable upon the exercise thereof.  The Company covenants and
agrees that, upon exercise of the Warrants and payment of the Exercise Price
therefor, in accordance with the terms hereby, all Shares and other securities
issuable upon such exercise shall be duly and validly issued, fully paid and
non-assessable and not subject to preemptive rights of any shareholder.
 The Company further covenants and agrees that upon exercise of the
Warrants and payment of the exercise price therefor, all Shares and other
securities issuable upon such exercise shall be duly and validly issued, fully
paid and non-assessable and not subject to preemptive rights of any shareholder.
As long as the Warrants shall be outstanding, the Company shall use its
commercially reasonable efforts to cause all Shares issuable upon exercise of
the Warrants to be listed (subject to official notice of issuance) on all
securities exchanges (or, if applicable on the NASDAQ Global Select Market,
NASDAQ Global Market, NASDAQ Capital Market, NYSE Amex, OTC Bulletin Board or
any successor trading market) on which the shares of the Company’s common stock
may then be listed and/or quoted.

     

    8.           Certain Notice
Requirements.

     

    8.1           Holder's Right to Receive
Notice. Nothing herein shall be construed as conferring upon the Holders
the right to vote or consent or to receive notice as a shareholder for the
election of directors or any other matter, or as having any rights whatsoever as
a shareholder of the Company.  If, however, at any time prior to the
expiration of the Warrants and their exercise, any of the events described in
Section 8.2 shall occur, then, in one or more of said events, the Company shall
give written notice of such event at least fifteen (15) days prior to the date
fixed as a record date or the date of closing the transfer books for the
determination of the shareholders entitled to such dividend, distribution,
conversion or exchange of securities or subscription rights, or entitled to vote
on such proposed dissolution, liquidation, winding up or sale. Such notice shall
specify such record date or the date of the closing of the transfer books, as
the case may be.  Notwithstanding the foregoing, the Company shall deliver
to each Holder a copy of each notice given to the other shareholders of the
Company at the same time and in the same manner that such notice is given to the
shareholders.


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

     

    8.2           Events Requiring
Notice. The Company shall be required to give the notice described in
this Section 8 upon one or more of the following events: (i) if the Company
shall take a record of the holders of its Shares for the purpose of entitling
them to receive a dividend or distribution payable otherwise than in cash, or a
cash dividend or distribution payable otherwise than out of retained earnings,
as indicated by the accounting treatment of such dividend or distribution on the
books of the Company; (ii) the Company shall offer to all the holders of its
Shares any additional shares of capital stock of the Company or securities
convertible into or exchangeable for shares of capital stock of the Company, or
any option, right or warrant to subscribe therefor; or (iii) a dissolution,
liquidation or winding up of the Company (other than in connection with a
consolidation or share reconstruction or amalgamation) or a sale of all or
substantially all of its property, assets and business shall be
proposed.

     

    8.3           Notice of Change in Exercise
Price. The Company shall, promptly after an event requiring a change in
the Exercise Price pursuant to Section 6 hereof, send notice to the Holders of
such event and change ("Price Notice"). The Price Notice shall describe the
event causing the change and the method of calculating same and shall be
certified as being true and accurate by the Company's Chief Financial
Officer.

     

    8.4           Transmittal of
Notices. All notices, requests, consents and other communications under
this Warrant shall be in writing and shall be deemed to have been duly made when
hand delivered, or mailed by express mail or private courier service (i) if to
the registered Holder of the Warrant, to the address of such Holder as shown on
the books of the Company, or (ii) if to the Company, to following address or to
such other address as the Company may designate by notice to the
Holders:

    


    Ventrus Biosciences, Inc.

    787 Seventh Avenue, 48th
Floor

    New York, New York 10019

    Attention:  President

    Fax:  (212)
___-_____

     

    Copy
to:

    


    Wyrick
Robbins Yates & Ponton LLP

    4101 Lake
Boone Trail, Suite 300

    Raleigh,
NC 27607-7506

    Attention:
W. David Mannheim, Esq.

         Alexander
Donaldson, Esq.

    Fax:
(919) 781-4865

    


    9.           Miscellaneous.

     

    9.1           Amendments. The
Company and Rodman & Renshaw/National Securities may from time to time
supplement or amend this Warrant without the approval of any of the Holders in
order to cure any ambiguity, to correct or supplement any provision contained
herein that may be defective or inconsistent with any other provisions herein,
or to make any other provisions in regard to matters or questions arising
hereunder that the Company and Rodman & Renshaw/National Securities may deem
necessary or desirable and that the Company and Rodman & Renshaw/National
Securities deem shall not adversely affect the interest of the Holders. All
other modifications or amendments shall require the written consent of and be
signed by the party against whom enforcement of the modification or amendment is
sought.


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

     

    9.2           Headings. The
headings contained herein are for the sole purpose of convenience of reference,
and shall not in any way limit or affect the meaning or interpretation of any of
the terms or provisions of this Warrant.

     

    9.3.           Entire Agreement.
This Warrant (together with the other agreements and documents being delivered
pursuant to or in connection with this Warrant) constitutes the entire agreement
of the parties hereto with respect to the subject matter hereof, and supersedes
all prior agreements and understandings of the parties, oral and written, with
respect to the subject matter hereof.

     

    9.4           Binding Effect. This
Warrant shall inure solely to the benefit of and shall be binding upon, the
Holder and the Company and their permitted assignees, respective successors,
legal representative and assigns, and no other person shall have or be construed
to have any legal or equitable right, remedy or claim under or in respect of or
by virtue of this Warrant or any provisions herein contained.

     

    9.5           Governing Law; Submission to
Jurisdiction. This Warrant shall be governed by and construed and
enforced in accordance with the laws of the State of New York, without giving
effect to conflict of laws principles thereof.  The Company hereby agrees
that any action, proceeding or claim against it arising out of, or relating in
any way to, this Warrant shall be brought and enforced in the New York Supreme
Court, County of New York, or in the United States District Court for the
Southern District of New York, and irrevocably submits to such jurisdiction,
which jurisdiction shall be exclusive. The Company hereby waives any objection
to such exclusive jurisdiction and that such courts represent an inconvenient
forum. Any process or summons to be served upon the Company may be served by
transmitting a copy thereof by registered or certified mail, return receipt
requested, postage prepaid, addressed to it at the address set forth in Section
8 hereof.  Such mailing shall be deemed personal service and shall be legal
and binding upon the Company in any action, proceeding or claim. The Company and
the Holder agree that the prevailing party(ies) in any such action shall be
entitled to recover from the other party(ies) all of its reasonable attorneys'
fees and expenses relating to such action or proceeding and/or incurred in
connection with the preparation therefor.

     

    9.6           Waiver, etc. The
failure of the Company or the Holder to at any time enforce any of the
provisions of this Warrant shall not be deemed or construed to be a waiver of
any such provision, nor to in any way affect the validity of this Warrant or any
provision hereof or the right of the Company or any Holder to thereafter enforce
each and every provision of this Warrant. No waiver of any breach,
non-compliance or non-fulfillment of any of the provisions of this Warrant shall
be effective unless set forth in a written instrument executed by the party or
parties against whom or which enforcement of such waiver is sought; and no
waiver of any such breach, non-compliance or non-fulfillment shall be construed
or deemed to be a waiver of any other or subsequent breach, non-compliance or
non-fulfillment.

     

    9.7           Execution in
Counterparts.  This Warrant may be executed in one or more
counterparts, and by the different parties hereto in separate counterparts, each
of which shall be deemed to be an original, but all of which taken together
shall constitute one and the same agreement, and shall become effective when one
or more counterparts has been signed by each of the parties hereto and delivered
to each of the other parties hereto. Such counterparts may be delivered by
facsimile transmission or other electronic transmission.


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

     

    9.8           Exchange Agreement.
 As a condition of the Holder's receipt and acceptance of this Warrant,
Holder agrees that, at any time prior to the complete exercise of this Warrant
by Holder, if the Company, Rodman & Renshaw and National Securities enter
into an agreement ("Exchange Agreement") pursuant to which they agree that all
outstanding Warrants will be exchanged for securities or cash or a combination
of both, then Holder shall agree to such exchange and become a party to the
Exchange Agreement.

     

    [Remainder
of page deliberately left blank.]


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

     

    IN
WITNESS WHEREOF, the Company has caused this Warrant to be signed by its duly
authorized officer as of the ____ day of _______, 20___.

    


    
      
        	
                VENTRUS
      BIOSCIENCES, INC.

              
	 
      	 
      
	
                By:

              	
                  

              
	
                Name:

              	 
      
	
                Title:

              	 
      


      

    


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

     

    [Form to be used to exercise
Warrant:

     

    Date:                  ,                      20___

    


    The
undersigned hereby elects irrevocably to exercise the Warrant for [___] Shares
of VENTRUS BIOSCIENCES, INC. and hereby makes payment of $[_________] (at
the rate of $[___________] per Share) in payment of the Exercise Price pursuant
thereto. Please issue the Shares as to which this Warrant is exercised in
accordance with the instructions given below and, if applicable, a new Warrant
representing the number of Shares for which this Warrant has not been
exercised.

     

    or

     

    The
undersigned hereby elects irrevocably to convert its right to purchase [___]
Shares under the Warrant for [___] Shares, as determined in accordance with the
following formula:

    


    
      
        	 
      	 
      	
                Y(A-B)

              
	
                X

              	
                =

              	
                A

              


      

    

    
      
        	
                Where,

              	
                X

              	
                =

              	
                The
      number of Shares to be issued to Holder;

              
	 
      	
                Y

              	
                =

              	
                The
      number of Shares for which the Warrant is being
  exercised;

              
	 
      	
                A

              	
                =

              	
                The
      fair market value of one Share which is equal to $[____];
    and

              
	 
      	
                B

              	
                =

              	
                The
      Exercise Price which is equal to $[_____] per
  share

              


      

    

     

    The
undersigned agrees and acknowledges that the calculation set forth above is
subject to confirmation by the Company and any disagreement with respect to the
calculation shall be resolved by the Company in its sole
discretion.

     

    Please
issue the Shares as to which this Warrant is exercised in accordance with the
instructions given below and, if applicable, a new Warrant representing the
number of Shares for which this Warrant has not been converted.

    


    Signature

     

    Signature
Guaranteed


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    


    INSTRUCTIONS
FOR REGISTRATION OF SECURITIES

     

    Name:

     

    (Print in
Block Letters)

     

    Address:

     

    NOTICE:
The signature to this form must correspond with the name as written upon the
face of the Warrant without alteration or enlargement or any change whatsoever,
and must be guaranteed by a bank, other than a savings bank, or by a trust
company or by a firm having membership on a registered national securities
exchange.


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

     

    Form to
be used to assign Warrant:

     

    ASSIGNMENT

     

    (To be
executed by the registered Holder to effect a transfer of the within
Warrant):

    


    FOR VALUE
RECEIVED,     does hereby sell, assign and
transfer unto ______ the right to pruchaase Shares of VENTRUS BIOSCIENCES,
INC. ("Company") evidenced by the Warrant and does hereby authorize the Company
to transfer such right on the books of the Company.

     

    Dated:    ,
20__

     

    Signature

     

    Signature
Guaranteed

     

    NOTICE:
The signature to this form must correspond with the name as written upon the
face of the within Warrant without alteration or enlargement or any change
whatsoever, and must be guaranteed by a bank, other than a savings bank, or by a
trust company or by a firm having membership on a registered national securities
exchange.