EX-10.1





 Exhibit 10.1 

Execution Version 
  
 



 
 March 31, 2020 
 Pieris
Pharmaceuticals, Inc. 
 255 State Street, 9th Floor 
 Boston,
MA 02109 
 Attn: Stephen S. Yoder, Chief Executive Officer 
  

	 	Re:	 3(a)(9) Exchange Agreement 



Ladies and Gentlemen: 
 This letter agreement
(the “Agreement”) confirms the agreement of Pieris Pharmaceuticals, Inc. (the “Company”), and the holders of the Common Stock listed on Schedule I attached hereto (the
“Stockholders”), pursuant to which the Stockholders have agreed to exchange an aggregate of 3,000,000 shares (the “Shares”) of Common Stock, par value $0.001 per share, of the Company (the
“Common Stock”), beneficially owned by the Stockholders in consideration for a total of 3,000 shares of Series D Convertible Preferred Stock of the Company (the “Preferred Shares”), which shall have
the rights, preferences and privileges set forth in the Certificate of Designation set forth on Exhibit A attached hereto (the “COD”). The Preferred Shares will be convertible into a total of 3,000,000 shares of Common
Stock (subject to adjustment as provided in the COD), subject to beneficial ownership conversion limitations set forth in the COD. 
 In
consideration of the foregoing, the Company and the Stockholders agree as follows: 
 (1)    No later than the close of
business on the first business day after the date hereof (the “Closing Date”) and subject to the satisfaction or waiver of the conditions set forth herein, the Stockholders shall exchange the Shares for the Preferred Shares
(the “Exchange”) in the respective amounts listed on Schedule I. The Exchange shall be consummated pursuant to Section 3(a)(9) of the Securities Act of 1933, as amended (the “Securities
Act”). On the Closing Date: (a) the Company and the Stockholders shall jointly and irrevocably instruct Computershare Trust Company, N.A. (the “Transfer Agent”) to cancel the direct registration book-entry
statements from the Transfer Agent evidencing the Shares; and (b) the Company shall irrevocably instruct the Transfer Agent to issue and deliver to the Stockholders the Preferred Shares in book-entry form, in the amounts and in the names set
forth on Schedule I. 
 (2)    The Company represents and warrants to each Stockholder as follows: 

(a)    Neither the Company nor any of its affiliates nor any person acting on behalf of or for the benefit of any of the
forgoing, has paid or given, or agreed to pay or give, directly or indirectly, any commission or other remuneration (within the meaning of Section 3(a)(9) of the Securities Act and the rules and regulations of the U.S. Securities and Exchange
Commission (the “Commission”) promulgated thereunder) for soliciting the Exchange. Assuming 












 
the representations and warranties of the Stockholders contained herein are true and complete, the Exchange will qualify for the registration exemption contained in Section 3(a)(9) of the
Securities Act. 
 (b)    It has the requisite corporate power and authority and power to enter into this Agreement and
to consummate the Exchange and such transactions shall not contravene any contractual, regulatory, statutory or other obligation or restriction applicable to the Company. 

(c)    It has reserved a sufficient number of shares of Common Stock as may be necessary to fully permit the conversion of
the Preferred Shares and the issuance of the Common Stock issuable upon conversion of the Preferred Shares, without regard to any beneficial ownership limits. 

(3)    Each Stockholder, as to itself only, represents and warrants to the Company as follows: 

(a)    It has the requisite power and authority to enter into this Agreement and consummate the Exchange and such
transactions shall not contravene any contractual, regulatory, statutory or other obligation or restriction applicable to such Stockholder. 

(b)    It is the record and beneficial owner of the aggregate number of shares of Common Stock, Series A Convertible
Preferred Stock (the “Series A Preferred Stock”), Series B Convertible Preferred Stock (the “Series B Preferred Stock”) and Series C Convertible Preferred Stock (the “Series C Preferred
Stock”) of the Company set forth opposite its name on Schedule I, which shares constitute all of the shares of Common Stock, Series A Preferred Stock, Series B Preferred Stock and Series C Preferred Stock beneficially owned by
the Stockholders. 
 (c)    It is the record and beneficial owner of, and has valid and marketable title to, the Shares
being exchanged by it pursuant to this Agreement, free and clear of any lien, pledge, restriction or other encumbrance (other than restrictions arising pursuant to applicable securities laws), and has the absolute and unrestricted right, power and
capacity to surrender and exchange the Shares being exchanged by it pursuant to this Agreement, free and clear of any lien, pledge, restriction or other encumbrance. It is not a party to or bound by, and the Shares being exchanged by it pursuant to
this Agreement are not subject to, any agreement, understanding or other arrangement (i) granting any option, warrant or right of first refusal with respect to such Shares to any person, (ii) restricting its right to surrender and exchange
such Shares as contemplated by this Agreement, or (iii) restricting any other of its rights with respect to such Shares. 

(d)    Neither it nor any of its affiliates nor any person acting on behalf of or for the benefit of any of the forgoing,
has paid or given, or agreed to pay or give, directly or indirectly, any commission or other remuneration (within the meaning of Section 3(a)(9) of the Securities Act and the rules and regulations of the Commission promulgated thereunder) for
soliciting the Exchange, and the Stockholders have received no additional consideration for the Shares other than the Preferred Shares. 

(4)    This Agreement, and any action or proceeding arising out of or relating to this Agreement, shall be exclusively
governed by the laws of the State of New York. 

  
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 (5)    In the event that any part of this agreement is declared by any
court or other judicial or administrative body to be null, void or unenforceable, said provision shall survive to the extent it is not so declared, and all of the other provisions of this agreement shall remain in full force and effect. In such an
event, the Stockholders and the Company shall endeavor in good faith negotiations to modify this agreement so as to affect the original intent of the parties as closely as possible. 

(6)    No provision of this Agreement may be amended or modified except upon the written consent of the Company and each
of the Stockholders, and no provision hereof may be waived other than by a written instrument signed by the party against whom enforcement of such waiver is sought. 

(7)    This Agreement may be executed in two or more counterparts, each of which shall constitute an original, but all of
which, when taken together, shall constitute but one instrument, and shall become effective when one or more counterparts have been signed by each party hereto and delivered to the other parties. 

[SIGNATURE PAGE FOLLOWS] 

  
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 Please sign to acknowledge agreement with the above terms and return to the undersigned. 

 

			
	 Common Stockholder:
  

Biotechnology Value Fund, L.P.

		
	By:	 	/s/ Mark Lampert
	 Name:
 Title:
	 	 Mark Lampert
 Chief Executive Officer BVF I
GP LLC, itself General Partner of Biotechnology Value Fund, L.P.



  

			
	Biotechnology Value Fund II, L.P.
		
	By:	 	/s/ Mark Lampert
	 Name:
 Title:
	 	 Mark Lampert
 Chief Executive Officer BVF II
GP LLC, itself General Partner of Biotechnology Value Fund II, L.P.



  

			
	Biotechnology Value Trading Fund OS, L.P.
		
	By:	 	/s/ Mark Lampert
	 Name:
 Title:
	 	 Mark Lampert
 President BVF Inc., General
Partner of BVF Partners L.P., itself sole member of BVF Partners OS Ltd., itself GP of Biotechnology Value Trading Fund OS, L.P.



  












 Acknowledged and agreed: 
  

			
	Pieris Pharmaceuticals, Inc.
		
	By:	 	/s/ Stephen S. Yoder
	 Name:
 Title:
	 	 Stephen S. Yoder
 President and Chief
Executive Officer














 SCHEDULE I 
  

																									
	Stockholder	 	Shares of
Common
Stock
Beneficially
Owned	 	 	Shares of
Series A
Preferred
Stock
Beneficially
Owned	 	 	Shares of
Series B
Preferred
Stock
Beneficially
Owned	 	 	Shares of
Series C
Preferred
Stock
Beneficially
Owned	 	 	 Shares
of
Common
Stock
 to be
Exchanged
	 	 	 Shares of
Series
D
Preferred
Stock
 to be
Received
	 
	
Biotechnology Value Fund, L.P.
	 	 	2,898,617	 	 	 	1,567	 	 	 	2,573	 	 	 	1,796	 	 	 	1,759,000	 	 	 	1,759	 
	
Biotechnology Value Fund II, L.P.
	 	 	2,233,074	 	 	 	1,021	 	 	 	2,143	 	 	 	1,445	 	 	 	1,078,000	 	 	 	1,078	 
	
Biotechnology Value Trading Fund OS, L.P.
	 	 	314,139	 	 	 	319	 	 	 	284	 	 	 	265	 	 	 	163,000	 	 	 	163	 
	 MSI BVF
SPV, LLC
	 	 	426,932	 	 	 	—  	 	 	 	—  	 	 	 	16	 	 	 	—  	 	 	 	—  	 
	
Total
	 	 	5,872,762	 	 	 	2,907	 	 	 	5,000	 	 	 	3,522	 	 	 	3,000,000	 	 	 	3,000	 


  
 Schedule-1 













 Exhibit A 

CERTIFICATE OF DESIGNATION OF 

SERIES D CONVERTIBLE PREFERRED STOCK 

OF 
 PIERIS
PHARMACEUTICALS, INC. 
 Pieris Pharmaceuticals, Inc., a Nevada corporation (the “Corporation”), in accordance with the
provisions of Nevada Revised Statutes (“NRS”) 78.195 and 78.1955, does hereby certify that, pursuant to the authority conferred upon the board of directors of the Corporation (the “Board of Directors”)
by the Corporation’s articles of incorporation, as heretofore amended to date (the “Articles of Incorporation”), the Board of Directors has, by a resolution duly adopted pursuant thereto, established a series of the
Corporation’s preferred stock consisting of 3,000 shares of the Corporation’s preferred stock, par value $0.001 per share, designated as “Series D Convertible Preferred Stock” and having the voting powers, designations,
preferences, privileges, limitations, restrictions and relative rights set forth as follows, in addition to any provisions of the Articles of Incorporation applicable to all classes and series of Preferred Stock (all capitalized terms used but not
defined herein shall have the meanings set forth in the Articles of Incorporation): 
 Section 1.    Definitions. For the
purposes hereof, the following terms shall have the following meanings: 
 “Affiliate” means any person or entity
that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with a person or entity, as such terms are used in and construed under Rule 144 under the Securities Act. With respect to a
Holder, any investment fund or managed account that is managed on a discretionary basis by the same investment manager as such Holder will be deemed to be an Affiliate of such Holder. 

“Business Day” means any day except Saturday, Sunday, any day which shall be a federal legal holiday in the United
States or any day on which banking institutions in the State of New York are authorized or required by law or other governmental action to close. 

“Closing Sale Price” means, for any security as of any date, the last closing trade price for such security prior to
4:00 p.m., New York City time, on the principal securities exchange or trading market where such security is listed or traded, as reported by Bloomberg, L.P. (or an equivalent, reliable reporting service mutually acceptable to and hereafter
designated by Holders of a majority of the then-outstanding Series D Preferred Stock and the Corporation), or if the foregoing do not apply, the last trade price of such security in the
over-the-counter market on the electronic bulletin board for such security as reported by Bloomberg, L.P., or, if no last trade price is reported for such security by
Bloomberg, L.P., the average of the bid prices of any market makers for such security as reported on the OTC Pink Market by OTC Markets Group, Inc. If the Closing Sale Price cannot be calculated for a security on a particular date on any of the
foregoing bases, the Closing Sale Price of such security on such date shall be the fair market value as determined in good faith by the Board of Directors of the Corporation. 

“Commission” means the Securities and Exchange Commission. 

  
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 “Common Stock” means the Corporation’s common stock, par value
$0.001 per share, and stock of any other class of securities into which such securities may hereafter be reclassified or changed into. 

“Conversion Ratio” means 1,000 shares of Common Stock issuable upon conversion of every one share of Series D
Preferred Stock, as such 1,000: 1 ratio may be adjusted from time to time in accordance with Section 7. 
 “Conversion
Shares” means, collectively, the shares of Common Stock issuable upon conversion of the shares of Series D Preferred Stock in accordance with the terms hereof. 

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated
thereunder. 
 “Holder” means any holder of Series D Preferred Stock. 

“Issuance Date” means April 1, 2020. 

“Person” means any individual or corporation, partnership, trust, incorporated or unincorporated association, joint
venture, limited liability company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind. 

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

 “Trading Day” means a day on which the Common Stock is traded for any period on the principal securities exchange
or if the Common Stock is not traded on a principal securities exchange, on a day that the Common Stock is traded on another securities market on which the Common Stock is then being traded. 

Section 2.    Designation, Amount and Par Value; Assignment. 

a.    The series of preferred stock designated by this Certificate of Designation shall be designated as the
Corporation’s Series D Convertible Preferred Stock (the “Series D Preferred Stock”) and the number of shares so designated shall be 3,000 (which shall not be subject to increase except pursuant to an amendment to this
Certificate of Designation duly adopted in accordance with the applicable law and the written consent of the Holders of a majority of the issued and outstanding Series D Preferred Stock). Each share of Series D Preferred Stock shall have a par value
of $0.001 per share. 
 b.    The Corporation shall register shares of the Series D Preferred Stock in the name of the
Holders thereof from time to time upon records to be maintained by the Corporation for that purpose (the “Series D Preferred Stock Register”). The Series D Preferred Stock shall be issued in book entry only, provided that the
Corporation shall issue one or more certificates representing shares of Series D Preferred Stock, to the extent such issuance is requested by a given Holder. References herein to “certificates” representing the Series D Preferred Stock
shall apply only if such shares have been issued in certificated form. The Corporation may deem and treat the registered Holder of shares of Series D Preferred Stock as the absolute owner thereof for


  
 2 













 
the purpose of any conversion thereof and for all other purposes. The Corporation shall register the transfer of any shares of Series D Preferred Stock in the Series D Preferred Stock Register,
upon surrender of the certificates evidencing such shares to be transferred, duly endorsed by the Holder thereof, to the Corporation at its address specified herein. Upon any such registration or transfer, a new certificate evidencing the shares of
Series D Preferred Stock so transferred shall be issued to the transferee (if requested) and a new certificate evidencing the remaining portion of the shares not so transferred, if any, shall be issued to the transferring Holder, in each case,
within three Business Days. The provisions of this Certificate of Designation are intended to be for the benefit of all Holders from time to time and shall be enforceable by any such Holder. 

Section 3.    Dividends. Holders be entitled to receive when, as and if dividends are declared and paid on the
Corporation’s Common Stock, an equivalent dividend (with the same dividend declaration date and payment date), calculated on an as-converted basis. Other than the foregoing, the Holders of Series D
Preferred Stock shall not be entitled to receive any dividends in respect of the Series D Preferred Stock, unless and until specifically declared by the Board of Directors of the Corporation to be payable to the Holders of the Series D Preferred
Stock. 
 Section 4.    Voting Rights. Except as otherwise provided herein or as otherwise required by the NRS, the Series D
Preferred Stock shall have no voting rights. However, as long as any shares of Series D Preferred Stock are outstanding, the Corporation shall not, without the affirmative vote of the Holders of a majority of the then outstanding shares of the
Series D Preferred Stock, (a) alter or change adversely the powers, preferences or rights given to the Series D Preferred Stock or alter or amend this Certificate of Designation, (b) increase the number of authorized shares of Series D
Preferred Stock, or (c) enter into any agreement with respect to any of the foregoing. 
 Section 5.    Rank;
Liquidation. 
 a.    The Series D Preferred Stock shall rank (i) senior to the Common Stock, and
(ii) senior to any class or series of capital stock of the Corporation hereafter created specifically ranking by its terms junior to any Series D Preferred Stock (“Junior Securities”); (iii) on parity with all shares of
the Corporation’s Series A Convertible Preferred Stock, Series B Convertible Preferred Stock and Series C Convertible Preferred Stock; (iv) on parity with any class or series of capital stock of the Corporation hereafter created
specifically ranking by its terms on parity with the Series D Preferred Stock (together with the Corporation’s Series A Convertible Preferred Stock, Series B Convertible Preferred Stock and Series C Convertible Preferred Stock, the
“Parity Securities”); and (v) junior to any class or series of capital stock of the Corporation hereafter created specifically ranking by its terms senior to any Series D Preferred Stock (“Senior
Securities”), in each case, as to distributions of assets upon liquidation, dissolution or winding up of the Corporation, whether voluntarily or involuntarily. 

b.    Subject to the prior and superior rights of the holders of any Senior Securities of the Corporation, upon
liquidation, dissolution or winding up of the Corporation, whether voluntary or involuntary, each Holder shall be entitled to receive, in preference to any distributions of any of the assets or surplus funds of the Corporation to the holders of the
Common Stock and Junior Securities and pari passu with any distribution to the holders of Parity Securities, an amount equal to $0.001 per share of Series D Preferred Stock, plus an additional 

  
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amount equal to any dividends declared but unpaid on such shares, before any payments shall be made or any assets distributed to holders of any class of Common Stock or Junior Securities,
provided, however, if that if the amount payable on a per-share basis to the holders of Common Stock on any such liquidation, dissolution or winding up of the Corporation shall be greater than the
foregoing liquidation preference that is payable to the holders of the Series D Preferred Stock, then the holders of Series D Preferred Stock shall instead receive, on an per-share and as-converted basis, the same assets or surplus funds that is to be distributed to the holders of Common Stock. If, upon any such liquidation, dissolution or winding up of the Corporation, the assets of the
Corporation shall be insufficient to pay the holders of shares of the Series D Preferred Stock the amount required under the preceding sentence, then all remaining assets of the Corporation shall be distributed ratably to holders of the shares of
the Series D Preferred Stock and Parity Securities. 
 Section 6.    Conversion. 

a.    Conversions at Option of Holder. Each whole share of Series D Preferred Stock shall be convertible, at any
time and from time to time from and after the Issuance Date, at the option of the Holder thereof, into a number of shares of Common Stock equal to the Conversion Ratio, as adjusted from time to time pursuant to Section 7. Holders shall effect
conversions by providing the Corporation with the form of conversion notice attached hereto as Annex A (a “Notice of Conversion”), duly completed and executed. Other than a conversion following a Fundamental Transaction or
following a notice provided for under Section 7(d)(ii) hereof, the Notice of Conversion must specify at least a number of shares of Series D Preferred Stock to be converted equal to the lesser of (x) 100 shares (such number subject to
appropriate adjustment following the occurrence of an event specified in Section 7(a) hereof) and (y) the number of shares of Series D Preferred Stock then held by the Holder. Provided the Corporation’s transfer agent is participating
in the Depository Trust Company (“DTC”) Fast Automated Securities Transfer program, the Notice of Conversion may specify, at the Holder’s election, whether the applicable Conversion Shares shall be credited to the
account of the Holder’s prime broker with DTC through its Deposit Withdrawal Agent Commission system (a “DWAC Delivery”). The “Conversion Date”, or the date on which a conversion shall be deemed
effective, is defined as the Trading Day that the Notice of Conversion, completed and executed, is sent by facsimile to, and received during regular business hours by, the Corporation; provided that if such shares of Series D Preferred Stock were
issued in certificated form, then the original certificate(s) representing such shares of Series D Preferred Stock being converted, duly endorsed, and the accompanying Notice of Conversion, are received by the Corporation within two Trading Days
thereafter. In all other cases, the Conversion Date shall be defined as the Trading Day on which the original certificates (if any) representing the shares of Series D Preferred Stock being converted, duly endorsed, and the accompanying Notice of
Conversion, are received by the Corporation. The calculations set forth in the Notice of Conversion shall control in the absence of manifest or mathematical error. 

b.    Beneficial Ownership Limitation. Notwithstanding anything in this Certificate of Designation to the contrary,
the Corporation shall not effect any conversion of the Series D Preferred Stock, and a Holder shall not have the right to convert any portion of the Series D Preferred Stock, to the extent that, after giving effect to an attempted conversion set
forth on an applicable Notice of Conversion, such Holder (together with such Holder’s Affiliates, and any 

  
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other Person whose beneficial ownership of Common Stock would be aggregated with the Holder’s for purposes of Section 13(d) of the Exchange Act and the applicable regulations of the
Commission, including any “group” of which the Holder is a member) would beneficially own a number of shares of Common Stock in excess of the Beneficial Ownership Limitation (as defined below). For purposes of the foregoing sentence, the
number of shares of Common Stock beneficially owned by such Holder and its Affiliates shall include the number of shares of Common Stock issuable upon conversion of the Series D Preferred Stock subject to the Notice of Conversion with respect to
which such determination is being made, but shall exclude the number of shares of Common Stock which are issuable upon (A) conversion of the remaining, unconverted Series D Preferred Stock beneficially owned by such Holder or any of its
Affiliates, and (B) exercise or conversion of the unexercised or unconverted portion of any other securities of the Corporation (including any warrants) beneficially owned by such Holder or any of its Affiliates that are subject to a limitation
on conversion or exercise similar to the limitation contained herein. Except as set forth in the preceding sentence, for purposes of this Section 6(b), beneficial ownership shall be calculated in accordance with Section 13(d) of the
Exchange Act and the applicable regulations of the Commission. In addition, for purposes hereof, “group” has the meaning set forth in Section 13(d) of the Exchange Act and the applicable regulations of the Commission. For purposes of
this Section 6(b), it is understood that the number of shares of Common Stock beneficially owned by each Holder shall be aggregated with each other Holder for purposes of Section 13(d) of the Exchange Act. For purposes of this
Section 6(b), in determining the number of outstanding shares of Common Stock, absent actual knowledge of such Holder to the contrary, a Holder may rely on the number of outstanding shares of Common Stock as stated in the most recent of the
following: (A) the Corporation’s most recent periodic or annual filing with the Commission, as the case may be, (B) a more recent public announcement by the Corporation that is filed with the Commission, or (C) a more recent
notice by the Corporation or the Corporation’s transfer agent to the Holder setting forth the number of shares of Common Stock then outstanding. Upon the written request of a Holder (which may be by email), the Corporation shall, within three
Trading Days thereof, confirm in writing to such Holder (which may be via email) the number of shares of Common Stock then outstanding. In any case, the number of outstanding shares of Common Stock shall be determined after giving effect to any
actual conversion or exercise of securities of the Corporation, including shares of Series D Preferred Stock, by such Holder or its Affiliates since the date as of which such number of outstanding shares of Common Stock was last publicly reported or
confirmed to the Holder. The initial “Beneficial Ownership Limitation” shall be 9.99% of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock pursuant
to such Notice of Conversion (to the extent permitted pursuant to this Section 6(b)). By written notice to the Corporation, which will not be effective until the 61st day after such notice is delivered to the Corporation, a Holder may increase
or decrease the Beneficial Ownership Limitation applicable solely to such Holder to such other percentage limit as may be determined by the Holder, not to exceed 19.99%, provided that any increase in the Beneficial Ownership Limitation shall not be
effective until the 61st day after such notice is delivered to the Corporation. The Corporation shall be entitled to rely on representations made to it by the Holder in any Notice of Conversion regarding its Beneficial Ownership Limitation. 

c.    Mechanics of Conversion. 

  
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 i.    Delivery of Certificate or Electronic Issuance Upon
Conversion. Not later than two Trading Days after the applicable Conversion Date, or if the Holder requests the issuance of physical certificate(s), two Trading Days after receipt by the Corporation of the original certificate(s) representing
such shares of Series D Preferred Stock being converted, duly endorsed, and the accompanying Notice of Conversion (the “Share Delivery Date”), the Corporation shall (a) deliver, or cause to be delivered, to the
converting Holder a physical certificate or certificates representing the number of Conversion Shares being acquired upon the conversion of shares of Series D Preferred Stock or (b) in the case of a DWAC Delivery, electronically transfer such
Conversion Shares by crediting the account of the Holder’s prime broker with DTC through its DWAC system. If in the case of any Notice of Conversion such certificate or certificates are not delivered to or as directed by or, in the case of a
DWAC Delivery, such shares are not electronically delivered to or as directed by, the applicable Holder by the Share Delivery Date, the applicable Holder shall be entitled to elect to rescind such Conversion Notice by written notice to the
Corporation at any time on or before its receipt of such certificate or certificates for Conversion Shares or electronic receipt of such shares, as applicable, in which event the Corporation shall promptly return to such Holder any original Series D
Preferred Stock certificate delivered to the Corporation and such Holder shall promptly return to the Corporation any Common Stock certificates or otherwise direct the return of any shares of Common Stock delivered to the Holder through the DWAC
system, representing the shares of Series D Preferred Stock unsuccessfully tendered for conversion to the Corporation. 

ii.    Obligation Absolute. Subject to Section 6(b) hereof and subject to Holder’s right to rescind a
Conversion Notice pursuant to Section 6(c)(i) above, the Corporation’s obligation to issue and deliver the Conversion Shares upon conversion of Series D Preferred Stock in accordance with the terms hereof are absolute and unconditional,
irrespective of any action or inaction by a Holder to enforce the same, any waiver or consent with respect to any provision hereof, the recovery of any judgment against any Person or any action to enforce the same, or any setoff, counterclaim,
recoupment, limitation or termination, or any breach or alleged breach by such Holder or any other Person of any obligation to the Corporation or any violation or alleged violation of law by such Holder or any other Person, and irrespective of any
other circumstance which might otherwise limit such obligation of the Corporation to such Holder in connection with the issuance of such Conversion Shares. Subject to Section 6(b) hereof and subject to Holder’s right to rescind a
Conversion Notice pursuant to Section 6(c)(i) above, in the event a Holder shall elect to convert any or all of its Series D Preferred Stock, the Corporation may not refuse conversion based on any claim that such Holder or anyone associated or
affiliated with such Holder has been engaged in any violation of law, agreement or for any other reason, unless an injunction from a court, on notice to Holder, restraining and/or enjoining conversion of all or part of the Series D Preferred Stock
of such Holder shall have been sought and obtained by the Corporation, and the Corporation posts a surety bond for the benefit of such Holder in the amount of 150% of the value of the Conversion Shares into which would be converted the Series D
Preferred Stock which is subject to such injunction, which bond shall remain in effect until the completion of arbitration/litigation of the underlying dispute and the proceeds of which shall be payable to such Holder to the extent it obtains
judgment. In the absence of such injunction, the Corporation shall, subject to Section 6(b) hereof and subject to Holder’s right to rescind a Conversion Notice pursuant to Section 6(c)(i) above, issue Conversion Shares upon a properly
noticed conversion. Nothing herein shall limit a Holder’s right to pursue actual damages for the Corporation’s failure to deliver Conversion Shares within 

  
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the period specified herein and such Holder shall have the right to pursue all remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific
performance and/or injunctive relief; provided that Holder shall not receive duplicate damages for the Corporation’s failure to deliver Conversion Shares within the period specified herein. The exercise of any such rights shall not prohibit a
Holder from seeking to enforce damages pursuant to any other Section hereof or under applicable law. 

iii.    Compensation for Buy-In on Failure to Timely Deliver Certificates Upon
Conversion. If the Corporation fails to deliver to a Holder the applicable certificate or certificates or to effect a DWAC Delivery, as applicable, by the Share Delivery Date pursuant to Section 6(c)(i) (other than a failure caused by
incorrect or incomplete information provided by Holder to the Corporation), and if after such Share Delivery Date such Holder is required by its brokerage firm to purchase (in an open market transaction or otherwise), or the Holder’s brokerage
firm otherwise purchases, shares of Common Stock to deliver in satisfaction of a sale by such Holder of the Conversion Shares which such Holder was entitled to receive upon the conversion relating to such Share Delivery Date (a “Buy-In”), then the Corporation shall (A) pay in cash to such Holder (in addition to any other remedies available to or elected by such Holder) the amount by which (x) such Holder’s total
purchase price (including any brokerage commissions) for the shares of Common Stock so purchased exceeds (y) the product of (1) the aggregate number of shares of Common Stock that such Holder was entitled to receive from the conversion at
issue multiplied by (2) the actual sale price at which the sell order giving rise to such purchase obligation was executed (including any brokerage commissions) and (B) at the option of such Holder, either reissue (if surrendered) the
shares of Series D Preferred Stock equal to the number of shares of Series D Preferred Stock submitted for conversion or deliver to such Holder the number of shares of Common Stock that would have been issued if the Corporation had timely complied
with its delivery requirements under Section 6(c)(i). For the avoidance of doubt, this Section 6(c)(ii) shall not apply if the Corporation does not effect a conversion pursuant to the limitations of Section 6(b). For example, if a
Holder purchases shares of Common Stock having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted conversion of shares of Series D Preferred Stock with respect to which the actual
sale price (including any brokerage commissions) giving rise to such purchase obligation was a total of $10,000 under clause (A) of the immediately preceding sentence, the Corporation shall be required to pay such Holder $1,000. The Holder
shall provide the Corporation written notice, within three (3) Trading Days after the occurrence of a Buy-In, indicating the amounts payable to such Holder in respect of such Buy-In together with applicable confirmations and other evidence reasonably requested by the Corporation. 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 Corporation’s failure to timely deliver certificates representing shares of Common Stock upon conversion of the shares
of Series D Preferred Stock as required pursuant to the terms hereof; provided, however, that the Holder shall not be entitled to both (i) require the reissuance of the shares of Series D Preferred Stock submitted for conversion for which such
conversion was not timely honored and (ii) receive the number of shares of Common Stock that would have been issued if the Corporation had timely complied with its delivery requirements under Section 6(c)(i). 

iv.    Reservation of Shares Issuable Upon Conversion. The Corporation covenants that it will at all times reserve
and keep available out of its authorized and unissued 

  
 7 













 
shares of Common Stock for the sole purpose of issuance upon conversion of the Series D Preferred Stock, free from preemptive rights or any other actual contingent purchase rights of Persons
other than the Holders of the Series D Preferred Stock, not less than such aggregate number of shares of the Common Stock as shall be issuable (taking into account the adjustments of Section 7) upon the conversion of all outstanding shares of
Series D Preferred Stock. The Corporation covenants that all shares of Common Stock that shall be so issuable shall, upon issue, be duly authorized, validly issued, fully paid and nonassessable. 

v.    Fractional Shares. No fractional shares or scrip representing fractional shares of Common Stock shall be
issued upon the conversion of the Series D Preferred Stock. As to any fraction of a share which a Holder would otherwise be entitled to receive upon such conversion, the Corporation shall pay a cash adjustment in respect of such final fraction in an
amount equal to such fraction multiplied by the fair value of the fraction of the Common Stock (determined with reference to the Closing Sale Price). 

vi.    Transfer Taxes. The issuance of certificates for shares of the Common Stock upon conversion of the Series D
Preferred Stock shall be made without charge to any Holder for any documentary stamp or similar taxes that may be payable in respect of the issue or delivery of such certificates, provided that the Corporation shall not be required to pay any tax
that may be payable in respect of any transfer involved in the issuance and delivery of any such certificate upon conversion in a name other than that of the registered Holder(s) of such shares of Series D Preferred Stock and the Corporation shall
not be required to issue or deliver such certificates unless or until the Person or Persons requesting the issuance thereof shall have paid to the Corporation the amount of such tax or shall have established to the satisfaction of the Corporation
that such tax has been paid. 
 d.    Status as Stockholder. Upon each Conversion Date, (i) the shares of
Series D Preferred Stock being converted shall be deemed converted into shares of Common Stock and (ii) the Holder’s rights as a holder of such converted shares of Series D Preferred Stock shall cease and terminate, excepting only the
right to receive certificates for such shares of Common Stock and to any remedies provided herein or otherwise available at law or in equity to such Holder because of a failure by the Corporation to comply with the terms of this Certificate of
Designation. In all cases, the Holder shall retain all of its rights and remedies for the Corporation’s failure to convert Series D Preferred Stock. 

Section 7.    Certain Adjustments. 

a.    Stock Dividends and Stock Splits. If the Corporation, at any time while any Series D Preferred Stock is
outstanding: (i) pays a stock dividend or otherwise makes a distribution or distributions payable in shares of Common Stock (which, for avoidance of doubt, shall not include any shares of Common Stock issued by the Corporation upon conversion
of any Series D Preferred Stock) with respect to the then outstanding shares of Common Stock; (ii) subdivides outstanding shares of Common Stock into a larger number of shares; or (iii) combines (including by way of a reverse stock split)
outstanding shares of Common Stock into a smaller number of shares, then the Conversion Ratio shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock (excluding any treasury shares of the Corporation)
outstanding immediately after such event and of which the denominator shall be the number of 

  
 8 













 
shares of Common Stock outstanding immediately before such event (excluding any treasury shares of the Corporation). Any adjustment made pursuant to this Section 7(a) shall become effective
immediately after the record date for the determination of stockholders entitled to receive such dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision or combination. 

b.    Fundamental Transaction. If, at any time while any Series D Preferred Stock is outstanding, (i) the
Corporation effects any merger or consolidation of the Corporation with or into another Person (other than a merger in which the Corporation is the surviving or continuing entity and its Common Stock is not exchanged for or converted into other
securities, cash or property), (ii) the Corporation effects any sale of all or substantially all of its assets in one transaction or a series of related transactions, (iii) any tender offer or exchange offer (whether by the Corporation or
another Person) is completed pursuant to which all of the Common Stock is exchanged for or converted into other securities, cash or property, or (iv) the Corporation effects any reclassification of the Common Stock or any compulsory share
exchange pursuant (other than as a result of a dividend, subdivision or combination covered by Section 7(a) above) to which the Common Stock is effectively converted into or exchanged for other securities, cash or property (in any such case, a
“Fundamental Transaction”), then, upon any subsequent conversion of Series D Preferred Stock the Holders shall have the right to receive, in lieu of the right to receive Conversion Shares, for each Conversion Share that would
have been issuable upon such conversion immediately prior to the occurrence of such Fundamental Transaction, the same kind and amount of securities, cash or property as it would have been entitled to receive upon the occurrence of such Fundamental
Transaction if it had been, immediately prior to such Fundamental Transaction, the holder of one share of Common Stock (the “Alternate Consideration”). For purposes of any such subsequent conversion, the determination of the
Conversion Ratio shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in respect of one share of Common Stock in such Fundamental Transaction, and the Corporation shall
adjust the Conversion Ratio in a reasonable manner reflecting the relative value of any different components of the Alternate Consideration. If holders of Common Stock are given any choice as to the securities, cash or property to be received in a
Fundamental Transaction, then the Holders shall be given the same choice as to the Alternate Consideration it receives upon any conversion of Series D Preferred Stock following such Fundamental Transaction. To the extent necessary to effectuate the
foregoing provisions, any successor to the Corporation or surviving entity in such Fundamental Transaction shall file a new Certificate of Designation with the same terms and conditions and issue to the Holders new preferred stock consistent with
the foregoing provisions and evidencing the Holders’ right to convert such preferred stock into Alternate Consideration. The terms of any agreement to which the Corporation is a party and pursuant to which a Fundamental Transaction is effected
shall include terms requiring any such successor or surviving entity to comply with the provisions of this Section 7(b) and insuring that the Series D Preferred Stock (or any such replacement security) will be similarly adjusted upon any
subsequent transaction analogous to a Fundamental Transaction. The Corporation shall cause to be delivered to each Holder, at its last address as it shall appear upon the stock books of the Corporation, written notice of any Fundamental Transaction
at least 10 calendar days prior to the date on which such Fundamental Transaction is expected to become effective or close. 

  
 9 













 c.    Calculations. All calculations under this Section 7
shall be made to the nearest cent or the nearest 1/100th of a share, as the case may be. For purposes of this Section 7, the number of shares of Common Stock deemed to be issued and outstanding as of a given date shall be the sum of the number
of shares of Common Stock (excluding any treasury shares of the Corporation) issued and outstanding. 
 d.    Notice
to the Holders. 
 i.    Adjustment to Conversion Ratio. Whenever the Conversion Ratio is adjusted pursuant
to any provision of this Section 7, the Corporation shall promptly deliver to each Holder a notice setting forth the Conversion Ratio after such adjustment and setting forth a brief statement of the facts requiring such adjustment. 

ii.    Other Notices. If (A) the Corporation shall declare a dividend (or any other distribution in whatever
form) on the Common Stock, (B) the Corporation shall declare a special nonrecurring cash dividend on or a redemption of the Common Stock, (C) the Corporation shall authorize the granting to all holders of the Common Stock of rights or
warrants to subscribe for or purchase any shares of capital stock of any class or of any rights, (D) the approval of any stockholders of the Corporation shall be required in connection with any reclassification of the Common Stock, any
consolidation or merger to which the Corporation is a party, any sale or transfer of all or substantially all of the assets of the Corporation, or any compulsory share exchange whereby the Common Stock is converted into other securities, cash or
property, or (E) the Corporation shall authorize the voluntary or involuntary dissolution, liquidation or winding up of the affairs of the Corporation, then, in each case, the Corporation shall cause to be filed at each office or agency
maintained for the purpose of conversion of the Series D Preferred Stock, and shall cause to be delivered to each Holder at its last address as it shall appear upon the stock books of the Corporation, at least 10 calendar days prior to the
applicable record or effective date hereinafter specified, a notice stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants, or if a record is not to be taken, the
date as of which the holders of the Common Stock of record to be entitled to such dividend, distributions, redemption, rights or warrants are to be determined or (y) the date on which such reclassification, consolidation, merger, sale, transfer
or share exchange is expected to become effective or close, and the date as of which it is expected that holders of the Common Stock of record shall be entitled to exchange their shares of the Common Stock for securities, cash or other property
deliverable upon such reclassification, consolidation, merger, sale, transfer or share exchange, provided that the failure to deliver such notice or any defect therein or in the delivery thereof shall not affect the validity of the corporate action
required to be specified in such notice. 
 Section 8.    Miscellaneous. 

a.    Redemption. The Series D Preferred Stock is not redeemable. 

b.    Notices. Any and all notices or other communications or deliveries to be provided by the Holders hereunder
including, without limitation, any Notice of Conversion, shall be in writing and delivered personally, via email, by facsimile, or sent by a nationally recognized overnight courier service, addressed to the Corporation, at 255 State Street, 9th
Floor, Boston, 

  
 10 













 
MA, 02109, email mousa@pieris.com, or such other facsimile number or address as the Corporation may specify for such purposes by notice to the Holders delivered in accordance with this
Section. Any and all notices or other communications or deliveries to be provided by the Corporation hereunder shall be in writing and delivered personally, by facsimile, or sent by a nationally recognized overnight courier service addressed to each
Holder at the facsimile number or address of such Holder appearing on the books of the Corporation, or if no such facsimile number or address appears on the books of the Corporation, at the principal place of business of such Holder. Any notice or
other communication or deliveries hereunder shall be deemed given and effective on the earliest of (i) the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number specified in this Section prior
to 5:30 p.m. (New York City time) on any date, (ii) the date immediately following the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number specified in this Section between 5:30 p.m. and
11:59 p.m. (New York City time) on any date, (iii) the second Business Day following the date of mailing, if sent by nationally recognized overnight courier service, or (iv) upon actual receipt by the party to whom such notice is required
to be given. 
 c.    Lost or Mutilated Series D Preferred Stock Certificate. If a Holder’s Series D
Preferred Stock certificate shall be mutilated, lost, stolen or destroyed, the Corporation shall execute and deliver, in exchange and substitution for and upon cancellation of a mutilated certificate, or in lieu of or in substitution for a lost,
stolen or destroyed certificate, a new certificate for the shares of Series D Preferred Stock so mutilated, lost, stolen or destroyed, but only upon receipt of evidence of such loss, theft or destruction of such certificate, and of the ownership
thereof, reasonably satisfactory to the Corporation and, in each case, customary and reasonable indemnity, if requested. Applicants for a new certificate under such circumstances shall also comply with such other reasonable regulations and
procedures and pay such other reasonable third-party costs as the Corporation may prescribe. 
 d.    Waiver. Any
waiver by the Corporation or a Holder of a breach of any provision of this Certificate of Designation shall not operate as or be construed to be a waiver of any other breach of such provision or of any breach of any other provision of this
Certificate of Designation or a waiver by any other Holders. The failure of the Corporation or a Holder to insist upon strict adherence to any term of this Certificate of Designation on one or more occasions shall not be considered a waiver or
deprive that party (or any other Holder) of the right thereafter to insist upon strict adherence to that term or any other term of this Certificate of Designation. Any waiver by the Corporation or a Holder must be in writing. Notwithstanding any
provision in this Certificate of Designation to the contrary, any provision contained herein and any right of the Holders of Series D Preferred Stock granted hereunder may be waived as to all shares of Series D Preferred Stock (and the Holders
thereof) upon the written consent of the Holders of not less than a majority of the shares of Series D Preferred Stock then outstanding, unless a higher percentage is required by the NRS, in which case the written consent of the Holders of not less
than such higher percentage shall be required. 
 e.    Severability. If any provision of this Certificate of
Designation is invalid, illegal or unenforceable, the balance of this Certificate of Designation shall remain in effect, and if any provision is inapplicable to any Person or circumstance, it shall nevertheless remain applicable to all other Persons
and circumstances. If it shall be found that any interest or other amount deemed interest due hereunder violates the applicable law governing usury, the applicable rate of interest 

  
 11 













 
due hereunder shall automatically be lowered to equal the maximum rate of interest permitted under applicable law. 

f.    Next Business Day. Whenever any payment or other obligation hereunder shall be due on a day other than a
Business Day, such payment shall be made on the next succeeding Business Day. 
 g.    Headings. The headings
contained herein are for convenience only, do not constitute a part of this Certificate of Designation and shall not be deemed to limit or affect any of the provisions hereof. 

h.    Status of Converted Series D Preferred Stock. If any shares of Series D Preferred Stock shall be converted or
reacquired by the Corporation, such shares shall, without need for any action by the Board of Directors or otherwise, resume the status of authorized but unissued shares of preferred stock and shall no longer be designated as Series D Preferred
Stock. 
 ******************** 

  
 12 













 IN WITNESS WHEREOF, the undersigned has executed this Certificate of Designation this
31st day of March, 2020. 
  

			
	PIERIS PHARMACEUTICALS, INC.
		
	By:	 	/s/ Stephen S. Yoder
	 Name:
 Title:
	 	 Stephen S. Yoder
 President and Chief
Executive Officer















 ANNEX A 

NOTICE OF CONVERSION 
 (TO BE
EXECUTED BY THE REGISTERED HOLDER IN ORDER TO CONVERT SHARES 
 OF SERIES D PREFERRED STOCK) 

The undersigned Holder hereby irrevocably elects to convert the number of shares of Series D Convertible Preferred Stock indicated below, represented by stock
certificate No(s). (the “Preferred Stock Certificates”), into shares of common stock, par value $0.001 per share (the “Common Stock”), of Pieris Pharmaceuticals, Inc., a Nevada corporation (the
“Corporation”), as of the date written below. If securities are to be issued in the name of a person other than the undersigned, the undersigned will pay all transfer taxes payable with respect thereto. Capitalized terms
utilized but not defined herein shall have the meaning ascribed to such terms in that certain Certificate of Designation of Preferences, Rights and Limitations of Series D Convertible Preferred Stock (the “Certificate of
Designation”) filed by the Corporation with the Secretary of State of the State of Nevada on March _____, 2020. 
 As of the date hereof, the
number of shares of Common Stock beneficially owned by the undersigned Holder (together with such Holder’s Affiliates, and any other Person whose beneficial ownership of Common Stock would be aggregated with the Holder’s for purposes of
Section 13(d) of the Exchange Act and the applicable regulations of the Commission, including any “group” of which the Holder is a member), including the number of shares of Common Stock issuable upon conversion of the Series D
Preferred Stock subject to this Notice of Conversion, but excluding the number of shares of Common Stock which are issuable upon (A) conversion of the remaining, unconverted Series D Preferred Stock beneficially owned by such Holder or any of
its Affiliates, and (B) exercise or conversion of the unexercised or unconverted portion of any other securities of the Corporation (including any warrants) beneficially owned by such Holder or any of its Affiliates that are subject to a
limitation on conversion or exercise similar to the limitation contained in Section 6(b) of the Certificate of Designation, is [ ]. For purposes hereof, beneficial ownership shall be calculated in accordance with Section 13(d) of the
Exchange Act and the applicable regulations of the Commission. In addition, for purposes hereof, “group” has the meaning set forth in Section 13(d) of the Exchange Act and the applicable regulations of the Commission.

 Conversion calculations: 
 Date to Effect Conversion:
                                         
                                         
                                         
              
 Number of shares of Series D Preferred Stock owned prior to Conversion:
                                         
                    
 Number of shares of Series D
Preferred Stock to be Converted:
                                         
                                        

Number of shares of Common Stock to be Issued:
                                         
                                         
                   
 Address for delivery of physical
certificates:
                                         
                                         
                           

or 

  
 Annex A-1 













 for DWAC Delivery: 

DWAC Instructions: 
 Broker no:
                                         
                                         
                                         
                      
 Account no:
                                         
                                         
                                         
                      
  

 

			
	[HOLDER]
		
	By:	 	 
	Name:	 	  

	Title:	 	  

	Date:	 	  


  
  

			
	[HOLDER]
		
	By:	 	 
	Name:	 	  

	Title:	 	  

	Date:	 	  




  
 Annex A-2