Exhibit 10.1


 


SECURITIES PURCHASE AGREEMENT


 


This SECURITIES PURCHASE
AGREEMENT this (“Agreement”), dated as of June 2, 2016, by and among Lion Biotechnologies, Inc., a Nevada corporation
(the “Company”), and the purchasers listed on Exhibit A hereto (each, a “Purchaser”
and collectively, the “Purchasers”).


 


WHEREAS, the Company has
engaged Jefferies LLC and Piper Jaffray & Co. to act as placement agents (the “Placement Agents”) for the
offering of the securities of the Company as more fully described in this Agreement.


 


WHEREAS, subject to the
terms and conditions of this Agreement, the Purchasers desire to purchase and the Company desires to sell up to a maximum of $100
million consisting of (i) no more than 9,684,000 shares of the Company’s common stock, par value $0.000041666 per share (the
“Common Stock”), representing 19.9% of the Company’s outstanding Common Stock immediately prior to the
transactions contemplated by this Agreement and (ii) up to 11,500,000 shares of the Company’s Series B Preferred Stock, par
value $0.001 per share (the “Preferred Shares”). 


 


WHEREAS, subject to the
terms and conditions set forth in this Agreement and pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended (the
“Securities Act”), and Rule 506 promulgated thereunder, the Company desires to issue and sell to each Purchaser,
and each Purchaser, severally and not jointly, desires to purchase from the Company, securities of the Company as more fully described
in this Agreement.


 


WHEREAS, contemporaneously
with the execution and delivery of this Agreement, the parties hereto are executing and delivering a Registration Rights Agreement
in the form attached hereto as Exhibit C (the “Registration Rights Agreement”), pursuant to which the
Company has agreed to provide certain registration rights under the Securities Act and the rules and regulations promulgated thereunder,
and applicable state securities laws.


 


NOW, THEREFORE, IN CONSIDERATION
of the mutual covenants contained in this Agreement, and for other good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, the Company and each Purchaser agree as follows:


 




     


     


    

 


ARTICLE I


 


Purchase and Sale of
Common Stock and Preferred Shares


 


Section
1.1           Purchase and Sale of Shares. At the Closing,
upon the following terms and conditions, the Company shall issue and sell to the Purchasers, and each Purchaser shall, severally
but not jointly, purchase from the Company the number of shares of Common Stock and Preferred Shares listed on Exhibit A attached
hereto for an aggregate purchase price of set forth on Exhibit A (the shares of Common Stock purchased hereunder are herein referred
to as the “Common Shares”). The purchase price (the “Purchase Price”) paid by each Purchaser
shall be allocated as follows: 46.00% of the Purchase Price shall be allocated to the purchase of Common Shares at a price of $4.75
per share, and 54.00% of the Purchase Price shall be allocated to the purchase of Preferred Shares at a purchase price of $4.75
per share. No fractional Preferred Shares shall be issued; any fractional Preferred Share shall be rounded the next whole share.
The portion of the Purchase Price of Preferred Shares that is rounded up or down shall be added to, or subtracted from, the purchase
price of the Common Shares and will increase or decrease the number of Common Shares purchased. The Common Shares and the Preferred
Shares are collectively referred to herein as the “Shares”. Notwithstanding the foregoing, the number of Common
Shares that any Purchaser will be permitted to purchase hereunder may not exceed the difference between 11,611,900 (19.9% of the
Company’s outstanding Common Stock after the issuance of the Common Shares pursuant to this Agreement) and the number of
shares of Common Stock beneficially owned by that Purchaser immediately prior to the acquisition of Shares hereunder. The Company
and the Purchasers are executing and delivering this Agreement in accordance with and in reliance upon the exemption from securities
registration afforded by Section 4(a)(2) of the Securities Act, and the rules and regulations promulgated thereunder, including
Regulation D (“Regulation D”), and/or upon such other exemption from the registration requirements of the Securities
Act as may be available with respect to any or all of the investments to be made hereunder.


 


Section
1.2           Purchase Price and Closing. The Company agrees
to issue and sell to the Purchasers and, in consideration of and in express reliance upon the representations, warranties, covenants,
terms and conditions of this Agreement, the Purchasers, severally but not jointly, agree to purchase the number of Shares set forth
on the signature page hereof and opposite their respective names on Exhibit A. The closing of the purchase and sale of the
Shares to be acquired by the Purchasers from the Company under this Agreement shall take place remotely via the exchange of documents
and signatures (the “Closing”) at 10:00 a.m., Eastern Time (i) on or before June 7, 2016, provided, that
all of the conditions set forth in Article IV hereof and applicable to the Closing shall have been fulfilled or waived in accordance
herewith, or (ii) at such other time and place or on such date as the Purchasers and the Company may agree upon (the “Closing
Date”). The entire Purchase Price payable by each Purchaser shall be payable in cash, by wire transfer or in immediately
available funds, at the Closing.


 


Section
1.3           Underlying Shares. The Company has authorized
and has reserved and covenants to continue to reserve, free of preemptive rights and other similar contractual rights of stockholders,
a number of its authorized but unissued shares of Common Stock equal to the aggregate number of shares of Common Stock necessary
to effect the conversion of the Preferred Shares. The Purchasers acknowledge that the Preferred Shares shall not be convertible
into shares of Common Stock unless, and until the stockholders of the Company approve the convertibility of the Preferred Shares,
which approval shall be provided in accordance with the rules of The Nasdaq Global Market. Any shares of Common Stock issuable
upon conversion of the Preferred Shares (and such shares when issued) are herein referred to as the “Underlying Shares”.
The Common Shares, the Preferred Shares and the Underlying Shares are sometimes collectively referred to herein as the “Securities”.


 




    	 	-2-	 



     


    

 


ARTICLE II


 


Representations and Warranties


 


Section
2.1           Representations and Warranties of the Company.
In order to induce the Purchasers to enter into this Agreement and to purchase the Shares, the Company hereby makes the following
representations and warranties to the Purchasers and the Placement Agents, as applicable:


 


(a)          Organization,
Good Standing and Power. The Company is a corporation duly incorporated, validly existing and in good standing under the laws
of the State of Nevada and has the requisite corporate power to own, lease and operate its properties and assets and to conduct
its business as it is now being conducted. The Company does not have any subsidiaries or own securities of any kind in any other
entity. The Company is duly qualified as a foreign corporation to do business and is in good standing in every jurisdiction in
which the nature of the business conducted or property owned by it makes such qualification necessary, except for any jurisdiction(s)
(alone or in the aggregate) in which the failure to be so qualified will not have a Material Adverse Effect. For the purposes of
this Agreement, “Material Adverse Effect” means any adverse effect on the business, operations, properties,
prospects or financial condition of the Company which is material to such entity or other entities controlling or controlled by
such entity or which is likely to materially affect the Company’s business or hinder the performance by the Company of its
material obligations hereunder and under the other Transaction Documents (as defined in Section 2.1(b) hereof).


 


(b)          Authorization;
Enforcement. The Company has the requisite corporate power and authority to enter into and perform this Agreement, the Certificate
of Designation of Rights, Preferences and Privileges of the Series B Preferred Stock setting forth the preferences, rights and
limitations of the Preferred Shares to be filed prior to the Closing by the Company with the Secretary of State of Nevada substantially
in the form attached hereto as Exhibit B (the “Certificate of Designation”), the Registration Rights Agreement,
and the other agreements and documents contemplated hereby and thereby and executed by the Company or to which the Company is party
(collectively, the “Transaction Documents”), and to issue and sell the Shares in accordance with the terms hereof.
The execution, delivery and performance of the Transaction Documents by the Company and the consummation by it of the transactions
contemplated thereby have been duly and validly authorized by all necessary corporate action, and no further consent or authorization
of the Company, the Company’s board of directors (the “Board”) or its stockholders is required. This Agreement
has been duly executed and delivered by the Company. The other Transaction Documents will have been duly executed and delivered
by the Company at or prior to the Closing. Each of the Transaction Documents constitutes, or shall constitute when executed and
delivered, a valid and binding obligation of the Company enforceable against the Company in accordance with its terms, except as
such enforceability may be limited by applicable bankruptcy, reorganization, moratorium, liquidation, conservatorship, receivership
or similar laws relating to, or affecting generally the enforcement of, creditor’s rights and remedies or by other equitable
principles of general application.


 




    	 	-3-	 



     


    

 


(c)          Capitalization.
The authorized capital stock of the Company and the shares thereof issued and outstanding as of the date of this Agreement are
set forth on Schedule 2.1(c) hereto. All of the outstanding shares of the Company’s Common Stock and any other security
of the Company have been duly and validly authorized. Except as set forth on Schedule 2.1(c) hereto, no shares of Common
Stock or any other security of the Company are entitled to preemptive rights or registration rights and there are no outstanding
options, warrants, scrip, rights to subscribe to, call or commitments of any character whatsoever relating to, or securities or
rights convertible into, any shares of capital stock of the Company. Furthermore, except as set forth on Schedule 2.1(c)
hereto, there are no contracts, commitments, understandings, or arrangements by which the Company is or may become bound to issue
additional shares of the capital stock of the Company or options, securities or rights convertible into shares of capital stock
of the Company. Except for customary transfer restrictions contained in agreements entered into by the Company in order to sell
restricted securities or as provided on Schedule 2.1(c) hereto, the Company is not a party to or bound by any agreement
or understanding granting registration or anti-dilution rights to 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 (each, a “Person”) with respect to any of its equity or debt securities.
The Company is not a party to, and it has no knowledge of, any agreement or understanding restricting the voting or transfer of
any shares of the capital stock of the Company. The offer and sale of all capital stock, convertible securities, rights, warrants,
or options of the Company issued prior to the Closing complied with all applicable federal and state securities laws, and no holder
of such securities has a right of rescission or claim for damages with respect thereto which could have a Material Adverse Effect.
The Company has furnished or made available to the Purchasers true and correct copies of the Company’s Articles of Incorporation
as amended and restated and in effect on the date hereof (the “Articles”), and the Company’s Bylaws as
in effect on the date hereof (the “Bylaws”).


 


(d)          Issuance
of Securities. The Shares to be issued at the Closing have been duly authorized by all necessary corporate action and, when
paid for or issued in accordance with the terms hereof, the Shares shall be validly issued and outstanding, fully paid and nonassessable
and free and clear of all liens, encumbrances and rights of refusal of any kind and the holders shall be entitled to all rights
accorded to a holder of Common Stock. The Underlying Shares to be issued upon conversion of the Preferred Shares have been duly
authorized by all necessary corporate action and when issued and paid for in accordance with the terms of this Agreement and as
set forth in the Certificate of Designation, such shares will be validly issued and outstanding, fully paid and nonassessable,
free and clear of all liens, encumbrances and rights of refusal of any kind and the holders shall be entitled to all rights accorded
to a holder of Common Stock.


 




    	 	-4-	 



     


    

 


(e)          No
Conflicts. The execution, delivery and performance of the Transaction Documents by the Company and the consummation by the
Company of the transactions contemplated hereby and thereby do not and will not (i) violate any provision of the Articles or Bylaws,
(ii) conflict with, or constitute a default (or an event which with notice or lapse of time or both would become a default) under,
or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, mortgage, deed of trust,
indenture, note, bond, license, lease agreement, instrument or obligation to which the Company is a party or by which the Company’s
respective properties or assets are bound, (iii) create or impose a lien, mortgage, security interest, charge or encumbrance of
any nature on any property or asset of the Company under any agreement or any commitment to which the Company is a party or by
which the Company is bound or by which any of their respective properties or assets are bound, or (iv) result in a violation of
any federal, state, local or foreign statute, rule, regulation, order, judgment or decree (including federal and state securities
laws and regulations) applicable to the Company or by which any property or asset of the Company is bound or affected, except,
in all cases other than violations pursuant to clauses (i) or (iv) (with respect to federal and state securities laws) above, for
such conflicts, defaults, terminations, amendments, acceleration, cancellations and violations as would not, individually or in
the aggregate, have a Material Adverse Effect. The business of the Company is not being conducted in violation of any laws, ordinances
or regulations of any governmental entity, except for possible violations which singularly or in the aggregate do not and will
not have a Material Adverse Effect. The Company is not required under federal, state, foreign or local law, rule or regulation
to obtain any consent, authorization or order of, or make any filing or registration with, any court or governmental agency in
order for it to execute, deliver or perform any of its obligations under the Transaction Documents or issue and sell the Securities
in accordance with the terms hereof or thereof (other than any filings which may be required to be made by the Company with the
Securities and Exchange Commission (the “Commission”) and/or FINRA prior to or subsequent to the Closing, or
state securities administrators subsequent to the Closing, or any registration statement which may be filed pursuant hereto or
thereto).


 


(f)          Commission
Documents; Financial Statements. The Company has made available to the Purchasers through the EDGAR system, true and complete
copies of the Company’s most recent Annual Report on Form 10-K for the fiscal year ended December 31, 2015 (the “Form
10-K”), and all other reports, schedules, forms, statements and other documents required to be filed by the Company pursuant
to the Securities Act and the Exchange Act of 1934, as amended (the “Exchange Act”), including pursuant to Section
13(a) or 15(d) thereof, since December 31, 2015 (all of the foregoing, including filings incorporated by reference therein, being
referred to herein as the “Commission Documents”). The Company has not provided to the Purchasers any material
non-public information or other information which, according to applicable law, rule or regulation, should have been disclosed
publicly by the Company but which has not been so disclosed, other than with respect to the transactions contemplated by this Agreement.
At the time of their filing, other than the timeliness of the filings, each Commission Document complied in all material respects
with the requirements of the Securities Act or Exchange Act, as applicable, and the rules and regulations of the Commission promulgated
thereunder and other federal, state and local laws, rules and regulations applicable to such documents, and, at the time of its
filing, each Commission Document did not contain any untrue statement of a material fact or omit to state a material fact required
to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were
made, not misleading. As of their respective dates, the financial statements of the Company included in the Commission Documents
complied as to form in all material respects with applicable accounting requirements and the published rules and regulations of
the Commission or other applicable rules and regulations with respect thereto. Such financial statements have been prepared in
accordance with generally accepted accounting principles (“GAAP”) applied on a consistent basis during the periods
involved (except (i) as may be otherwise indicated in such financial statements or the Notes thereto or (ii) in the case of unaudited
interim statements, to the extent they may not include footnotes or may be condensed or summary statements), and fairly present
in all material respects the financial position of the Company and its subsidiary as of the dates thereof and the results of operations
and cash flows for the periods then ended (subject, in the case of unaudited statements, to normal year-end audit adjustments).


 




    	 	-5-	 



     


    

 


(g)          No
Material Adverse Change. Since March 31, 2016, the Company has not experienced or suffered any Material Adverse Effect.


 


(h)          No
Undisclosed Liabilities. The Company has not incurred any liabilities, obligations, claims or losses (whether liquidated or
unliquidated, secured or unsecured, absolute, accrued, contingent or otherwise) other than those set forth in the Commission Documents
or incurred in the ordinary course of the Company’s business since March 31, 2016, and which, individually or in the aggregate,
do not or would not have a Material Adverse Effect on the Company.


 


(i)          No
Undisclosed Events or Circumstances. Since March 31, 2016, except as disclosed in the Commission Documents filed prior to the
date hereof, (i) to the Company’s knowledge, there has been no event, occurrence or development that has had or that could
reasonably be expected to result in a Material Adverse Effect, (ii) the Company has not incurred any liabilities (contingent or
otherwise) other than (A) trade payables and accrued expenses incurred in the ordinary course of business consistent with past
practice and (B) liabilities not required to be reflected in the Company’s financial statements pursuant to GAAP or disclosed
in filings made with the Commission, (iii) the Company has not altered its method of accounting, (iv) the Company has not declared
or made any dividend or distribution of cash or other property to its stockholders or purchased, redeemed or made any agreements
to purchase or redeem any shares of its capital stock and (v) the Company has not issued any equity securities to any officer,
director or affiliate, except pursuant to any existing Company stock option plans. The Company does not have pending before the
Commission any request for confidential treatment of information. Except for the issuance of the Securities contemplated by this
Agreement and set forth on Schedule 2.1(i) hereto, no event, liability, fact, circumstance, occurrence or development has
occurred or exists or is reasonably expected to occur or exist with respect to the Company or its subsidiary or their respective
businesses, properties, operations, assets or financial condition that would be required to be disclosed by the Company under applicable
securities laws at the time this representation is made or deemed made that has not been publicly disclosed at least one (1) trading
day prior to the date that this representation is made.


 


(j)          Title
to Assets. The Company has good and marketable title to all of its personal property, free and clear of any mortgages, pledges,
charges, liens, security interests or other encumbrances of any nature whatsoever, except for those that, individually or in the
aggregate, do not have a Material Adverse Effect. All said leases of the Company are valid and subsisting and in full force and
effect. The Company does not own any real property.


 


(k)          Actions
Pending. There is no action, suit, claim, investigation, arbitration, alternate dispute resolution proceeding or other proceeding
pending or, to the knowledge of the Company, threatened, against the Company which questions the validity of this Agreement or
any of the other Transaction Documents or any of the transactions contemplated hereby or thereby or any action taken or to be taken
pursuant hereto or thereto. Except as disclosed in the Commission Documents, there is no action, suit, claim, investigation, arbitration,
alternate dispute resolution proceeding or other proceeding pending or, to the knowledge of the Company, threatened against or
involving the Company or any of their respective properties or assets, which individually or in the aggregate, would have a Material
Adverse Effect. There are no outstanding orders, judgments, injunctions, awards or decrees of any court, arbitrator or governmental
or regulatory body against the Company or any officers or directors of the Company in their capacities as such, which individually,
or in the aggregate, would have a Material Adverse Effect.


 




    	 	-6-	 



     


    

 


(l)          Compliance
with Law. The business of the Company has been and is presently being conducted in accordance with all applicable federal,
state and local governmental laws, rules, regulations and ordinances, except as set forth in the Commission Documents or such that,
individually or in the aggregate, the noncompliance therewith would not have a Material Adverse Effect. The Company has all franchises,
permits, licenses, consents and other governmental or regulatory authorizations and approvals necessary for the conduct of its
business as now being conducted by it unless the failure to possess such franchises, permits, licenses, consents and other governmental
or regulatory authorizations and approvals, individually or in the aggregate, could not reasonably be expected to have a Material
Adverse Effect.


 


(m)          Taxes.
The Company has accurately prepared and filed all federal, state and other tax returns required by law to be filed by it, has paid
or made provisions for the payment of all taxes shown to be due and all additional assessments, and adequate provisions have been
and are reflected in the financial statements of the Company for all current taxes and other charges to which the Company is subject
and which are not currently due and payable. None of the federal income tax returns of the Company have been audited by the Internal
Revenue Service. The Company has no knowledge of any additional assessments, adjustments or contingent tax liability (whether federal
or state) of any nature whatsoever, whether pending or threatened against the Company for any period, nor of any basis for any
such assessment, adjustment or contingency.


 


(n)          Certain
Fees. The Company has not employed any broker or finder or incurred any liability for any brokerage or investment banking fees,
commissions, finders’ structuring fees, financial advisory fees or other similar fees in connection with the Transaction
Documents, except for dealings with the Placement Agents. The Company has agreed to pay customary commissions and fees to the Placement
Agents.


 


(o)          Disclosure.
Except with respect to the material terms and conditions of the transactions contemplated by the Transaction Documents, the Company
confirms that neither it nor any other Person acting on its behalf has provided any of the Purchasers or their agents or counsel
with any information that it believes constitutes or might constitute material, non-public information which is not otherwise disclosed
in the Commission Documents. The Company understands and confirms that the Purchasers will rely on the foregoing representation
in effecting transactions in securities of the Company. All of the disclosure furnished by or on behalf of the Company to the Purchasers
regarding the Company and its subsidiaries, their respective businesses and the transactions contemplated hereby, including any
disclosure schedules to this Agreement, is true and correct and does not contain any untrue statement of a material fact or omit
to state any material fact necessary in order to make the statements made therein, in light of the circumstances under which they
were made, not misleading. The Company acknowledges and agrees that no Purchaser makes or has made any representations or warranties
with respect to the transactions contemplated hereby other than those specifically set forth in Section 2.2 hereof.


 




    	 	-7-	 



     


    

 


(p)          Intellectual
Property. The Company and its subsidiary have, or have rights to use, all patents, patent applications, trademarks, trademark
applications, service marks, trade names, trade secrets, inventions, copyrights, licenses and other intellectual property rights
and similar rights necessary or required for use in connection with its current business as described in the Commission Documents
(collectively, the “Intellectual Property Rights”). Neither the Company nor its subsidiary has received a notice
(written or otherwise) that any of the material Intellectual Property Rights has expired, terminated or been abandoned, or is expected
to expire or terminate or be abandoned, within two (2) years from the date of this Agreement. Neither the Company nor any of its
subsidiaries has received, since the date of the latest audited financial statements included within the Commission Documents,
a written notice of a claim or otherwise has any knowledge that the Intellectual Property Rights violate or infringe upon the rights
of any Person. To the knowledge of the Company, all such Intellectual Property Rights are enforceable and there is no existing
infringement by another Person of any of the Intellectual Property Rights. The Company and its subsidiaries have taken reasonable
security measures to protect the secrecy, confidentiality and value of all of their intellectual properties.


 


(q)          Books
and Records; Sarbanes-Oxley; Internal Accounting Controls. The books, records and documents of the Company accurately reflect
in all material respects the information relating to the business of the Company, the location and collection of their assets,
and the nature of all transactions giving rise to the obligations or accounts receivable of the Company. The Company maintains
a system of internal accounting controls sufficient to provide reasonable assurance that: (i) transactions are executed in accordance
with management’s general or specific authorizations, (ii) transactions are recorded as necessary to permit preparation of
financial statements in conformity with GAAP and to maintain asset accountability, (iii) access to assets is permitted only in
accordance with management’s general or specific authorization, and (iv) the recorded accountability for assets is compared
with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences. The Company and
its subsidiaries have established disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e))
for the Company and its subsidiaries and designed such disclosure controls and procedures to ensure that information required to
be disclosed by the Company in the reports it files or submits under the Exchange Act is recorded, processed, summarized and reported,
within the time periods specified in the Commission’s rules and forms. The Company’s certifying officers have evaluated
the effectiveness of the disclosure controls and procedures of the Company and its subsidiaries as of the end of the period covered
by the most recently filed periodic report under the Exchange Act (such date, the “Evaluation Date”) and have
presented in the Company’s most recently filed periodic report under the Exchange Act the conclusions of the certifying officers
about the disclosure controls and procedures based on their evaluations as of the Evaluation Date. Since the Evaluation Date, there
have been no changes in the internal control over financial reporting (as such term is defined in the Exchange Act) of the Company
that have adversely affected, or is reasonably likely to adversely affect, the internal control over financial reporting of the
Company.


 




    	 	-8-	 



     


    

 


(r)          Material
Agreements. Except the Transaction Documents, or as disclosed in any of the Schedules attached hereto, or as included
as exhibits to the Commission Documents, the Company is not a party to any written or oral contract, instrument, agreement, commitment,
obligation, plan or arrangement, a copy of which would be required to be filed with the Commission (collectively, “Material
Agreements”) if the Company was registering securities under the Securities Act. The Company has in all material respects
performed all the obligations required to be performed by it to date under the foregoing agreements, and the Company has not received
a notice of default and, to the best of the Company’s knowledge, it is not in default under any Material Agreement now in
effect, the result of which could cause a Material Adverse Effect.


 


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


 


(t)          Private
Placement. Assuming the accuracy of the Purchasers’ representations and warranties set forth in Section 2.2, no registration
under the Securities Act is required for the offer and sale of the Securities by the Company to the Purchasers as contemplated
hereby. The issuance and sale of the Securities hereunder does not contravene the rules and regulations of The Nasdaq Global Market,
or any other market or exchange on which the Common Stock is listed or quoted for trading on the Closing Date.


 


(u)          No
Integrated Offering. Assuming the accuracy of the Purchasers’ representations and warranties set forth in Section 2.2,
neither the Company, nor any of its affiliates, nor any Person acting on its or their behalf has, directly or indirectly, made
any offers or sales of any security or solicited any offers to buy any security, under circumstances that would cause this offering
of the Securities to be integrated with prior offerings by the Company for any purposes, including the Securities Act which would
require the registration of any such securities under the Securities Act.


 


(v)         Securities
Act of 1933. The Company has complied and will comply with all applicable federal and state securities laws in connection with
the offer, issuance and sale of the Securities hereunder. Neither the Company nor anyone acting on its behalf, directly or indirectly,
has or will sell, offer to sell or solicit offers to buy any of the Securities, or similar securities to, or solicit offers with
respect thereto from, or enter into any preliminary conversations or negotiations relating thereto with, any Person, or has taken
or will take any action so as to bring the issuance and sale of any of the Securities under the registration provisions of the
Securities Act and applicable state securities laws. Neither the Company nor any of its affiliates, nor any Person acting on its
or their behalf, has engaged in any form of general solicitation or general advertising (within the meaning of Regulation D under
the Securities Act) in connection with the offer or sale of any of the Securities.


 




    	 	-9-	 



     


    

 


(w)          Governmental
Approvals. Except for the filing of any notice prior or subsequent to the Closing that may be required under applicable state
and/or federal securities laws (which if required, shall be filed on a timely basis), no authorization, consent, approval, license,
exemption of, filing or registration with any court or governmental department, commission, board, bureau, agency or instrumentality,
domestic or foreign, is or will be necessary for, or in connection with, the execution or delivery of the Shares, or for the performance
by the Company of its obligations under the Transaction Documents.


 


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


 


(y)          Foreign
Corrupt Practices. Neither the Company nor to the knowledge of the Company, any agent or other Person acting on behalf of the
Company, has: (i) directly or indirectly, used any funds for unlawful contributions, gifts, entertainment or other unlawful expenses
related to foreign or domestic political activity, (ii) made any unlawful payment to foreign or domestic government officials or
employees or to any foreign or domestic political parties or campaigns from corporate funds, (iii) failed to disclose fully any
contribution made by the Company (or made by any Person acting on its behalf of which the Company is aware) which is in violation
of law or (iv) violated in any material respect any provision of Foreign Corrupt Practices Act of 1977, as amended.


 


(z)          No
Disagreements with Accountants. There are no disagreements of any kind presently existing between the Company and the accountants
formerly or presently employed by the Company.


 


(aa)         Acknowledgment
Regarding Purchasers’ Purchase of Securities. The Company acknowledges and agrees that each of the Purchasers is acting
solely in the capacity of an arm’s length purchaser with respect to the Transaction Documents and the transactions contemplated
thereby. The Company further acknowledges that no Purchaser is acting as a financial advisor or fiduciary of the Company (or in
any similar capacity) with respect to the Transaction Documents and the transactions contemplated thereby and any advice given
by any Purchaser or any of their respective representatives or agents in connection with the Transaction Documents and the transactions
contemplated thereby is merely incidental to the Purchasers’ purchase of the Securities. The Company further represents to
each Purchaser that the Company’s decision to enter into this Agreement and the other Transaction Documents has been based
solely on the independent evaluation of the transactions contemplated hereby by the Company and its representatives.


 




    	 	-10-	 



     


    

 


(bb)       Investment
Company Act Status. The Company is not, and as a result of and immediately upon Closing will not be, an “investment company”
or a company “controlled” by an “investment company”, within the meaning of the Investment Company Act
of 1940, as amended.


 


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


 


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


 


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


 


(ff)         Bank
Holding Company Act. The Company is not subject to the Bank Holding Company Act of 1956, as amended (the “BHCA”)
and to regulation by the Board of Governors of the Federal Reserve System (the “Federal Reserve”). The Company
does not own or control, directly or indirectly, five percent (5%) or more of the outstanding shares of any class of voting securities
or twenty-five percent or more of the total equity of a bank or any entity that is subject to the BHCA and to regulation by the
Federal Reserve.  The Company does not exercise a controlling influence over the management or policies of a bank or
any entity that is subject to the BHCA and to regulation by the Federal Reserve.


 


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


 




    	 	-11-	 



     


    

 


(hh)       Acknowledgement
Regarding Purchaser’s Trading Activity. Anything in this Agreement or elsewhere herein to the contrary notwithstanding
(except for Section 2.2(f) hereof), it is understood and acknowledged by the Company that: (i) none of the Purchasers has been
asked by the Company to agree, nor has any Purchaser agreed, to desist from purchasing or selling, long and/or short, securities
of the Company, or “derivative” securities based on securities issued by the Company or to hold the Securities for
any specified term; (ii) past or future open market or other transactions by any Purchaser, specifically including, without limitation,
short sales or “derivative” transactions, before or after the closing of this or future private placement transactions,
may negatively impact the market price of the Company’s publicly-traded securities; (iii) any Purchaser, and counter-parties
in “derivative” transactions to which any such Purchaser is a party, directly or indirectly, presently may have a “short”
position in the Common Stock, and (iv) each Purchaser shall not be deemed to have any affiliation with or control over any arm’s
length counter-party in any “derivative” transaction. The Company further understands and acknowledges that (y) one
or more Purchasers may engage in hedging activities at various times during the period that the Securities are outstanding, including,
without limitation, during the periods that the value of the Underlying Shares deliverable with respect to Securities are being
determined, and (z) such hedging activities (if any) could reduce the value of the existing stockholders’ equity interests
in the Company at and after the time that the hedging activities are being conducted. The Company acknowledges that such aforementioned
hedging activities do not constitute a breach of any of the Transaction Documents.


 


(ii)         Regulatory
Permits. The Company and its subsidiaries possess all certificates, authorizations and permits issued by the appropriate federal,
state, local or foreign regulatory authorities necessary to for their respective businesses as currently conducted and as described
in the Commission Documents, except where the failure to possess such permits could not reasonably be expected to result in a Material
Adverse Effect (“Material Permits”), and neither the Company nor any of its subsidiaries has received any notice
of proceedings relating to the revocation or modification of any Material Permit.


 


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


 




    	 	-12-	 



     


    

 


(kk)        No
Disqualification Events. None of the Company, any of its predecessors, any affiliated issuer, any director, executive officer,
other officer of the Company participating in the offering, any beneficial owner of 20% or more of the Company’s outstanding
voting equity securities, calculated on the basis of voting power, nor any promoter (as that term is defined in Rule 405 under
the Securities Act) connected with the Company in any capacity at the time of sale (each, a "Company Covered
Person" and, together, "Company Covered Persons") is
subject to any of the "Bad Actor" disqualifications described in Rule 506(d)(1)(i) to (viii) under the Securities Act
(a "Disqualification Event"), except for a Disqualification Event covered
by Rule 506(d)(2) or (d)(3). The Company has exercised reasonable care to determine whether any Company Covered Person is subject
to a Disqualification Event. The Company has complied, to the extent applicable, with its disclosure obligations under Rule 506(e),
and has furnished to the Placement Agents a copy of any disclosures provided thereunder.


 


(ll)         Other
Covered Persons. Other than the Placement Agents, the Company is not aware of any Person (other than any Company Covered Person)
that has been or will be paid (directly or indirectly) remuneration for solicitation of purchasers in connection with the sale
of the Securities pursuant to this Agreement.


 


(mm)      Notice
of Disqualification Events. The Company will notify the Purchasers and the Placement Agents in writing, prior to the Closing
Date of (i) any Disqualification Event relating to any Company Covered Person and (ii) any event that would, with the passage of
time, become a Disqualification Event relating to any Company Covered Person.


 


(nn)       No
Registration Rights. No Person has the right to (i) prohibit the Company from filing a registration statement or (ii) other
than as disclosed in the Commission Documents, require the Company to register any securities for sale under the Securities Act
by reason of the filing of a registration statement. The granting and performance of the registration rights under the Registration
Rights Agreement will not violate or conflict with, or result in a breach of any provision of, or constitute a default under, any
agreement, indenture, or instrument to which the Company is a party.


 


Section
2.2           Representations and Warranties of the Purchasers.
Each of the Purchasers hereby makes the following representations and warranties to the Company with respect solely to itself and
not with respect to any other Purchaser:


 


(a)          Organization
and Standing of the Purchasers. If such Purchaser is an entity, such Purchaser is a corporation, limited liability company,
partnership or any other entity duly incorporated or organized, validly existing and in good standing under the laws of the jurisdiction
of its incorporation or organization.


 


(b)          Authorization
and Power. Such Purchaser has the requisite power and authority to enter into and perform the Transaction Documents and to
purchase the Shares being sold to it hereunder. The execution, delivery and performance of the Transaction Documents by such Purchaser
and the consummation by it of the transactions contemplated hereby have been duly authorized by all necessary corporate or partnership
action, and no further consent or authorization of such Purchaser or its board of directors, stockholders, or partners, as the
case may be, is required. This Agreement has been duly authorized, executed and delivered by such Purchaser. The other Transaction
Documents constitute, or shall constitute when executed and delivered, valid and binding obligations of such Purchaser enforceable
against such Purchaser in accordance with their terms, except as such enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, liquidation, conservatorship, receivership or similar laws relating to, or affecting generally the
enforcement of, creditor’s rights and remedies or by other equitable principles of general application.


 




    	 	-13-	 



     


    

 


(c)          Acquisition
for Investment. Such Purchaser is purchasing the Shares solely for its own account for the purpose of investment and not with
a view to or for sale in connection with the distribution thereof. Such Purchaser does not have a present intention to sell any
of the Securities, nor a present arrangement (whether or not legally binding) or intention to effect any distribution of any of
the Securities to or through any Person; provided, however, that by making the representations herein and subject
to Section 2.2(e) below, such Purchaser does not agree to hold any of the Securities for any minimum or other specific term and
reserves the right to pledge any of the Securities for margin purposes and/or to dispose of any of the Securities at any time in
accordance with federal and state securities laws applicable to such disposition. Such Purchaser acknowledges that it (i) has such
knowledge and experience in financial and business matters such that such Purchaser is capable of evaluating the merits and risks
of its investment in the Company, (ii) is able to bear the financial risks associated with an investment in the Securities, and
(iii) has been given full access to such records of the Company and to the officers of the Company as it has deemed necessary or
appropriate to conduct its due diligence investigation.


 


(d)          Rule
144. Such Purchaser understands that the Securities must be held indefinitely unless such Securities are registered under the
Securities Act or an exemption from registration is available. Such Purchaser acknowledges that it is familiar with Rule 144 of
the rules and regulations of the Commission, as amended, promulgated pursuant to the Securities Act (“Rule 144”),
and that such Purchaser has been advised that Rule 144 permits resales only under certain circumstances. Such Purchaser understands
that to the extent that Rule 144 is not available, such Purchaser will be unable to sell any Securities without either registration
under the Securities Act or the existence of another exemption from such registration requirement.


 


(e)          General.
Such Purchaser understands that the Securities are being offered and sold in reliance on a transactional exemption from the registration
requirements of United States federal and state securities laws and the Company is relying in part upon the truth and accuracy
of the representations, warranties, agreements, acknowledgments and understandings of such Purchaser set forth herein in order
to determine the availability of such exemptions and the suitability of such Purchaser to acquire the Securities. Such Purchaser
understands that no United States federal or state agency or any government or governmental agency has passed upon or made any
recommendation or endorsement of the Securities.


 


(f)          Experience
of Such Purchaser; Independent Investment Decision. Such Purchaser, either alone or together with its representatives, has
such knowledge, sophistication and experience in business and financial matters so as to be capable of evaluating the merits and
risks of the prospective investment in the Securities, and has so evaluated the merits and risks of such investment. Such Purchaser
is able to bear the economic risk of an investment in the Securities and, at the present time, is able to afford a complete loss
of such investment. Such Purchaser understands that the Placement Agents have acted solely as the agents of the Company in this
placement of the Securities and such Purchaser has not relied on the business or legal advice of the Placement Agents or any of
its agents, counsel or affiliates in making its investment decision hereunder, and confirms that none of such persons has made
any representations or warranties to such Purchaser in connection with the transactions contemplated herein..


 




    	 	-14-	 



     


    

 


(g)          No
General Solicitation. Such Purchaser acknowledges that the Securities were not offered to such Purchaser by means of any form
of general or public solicitation or general advertising, or publicly disseminated advertisements or sales literature, including
(i) any advertisement, article, notice or other communication published in any newspaper, magazine, or similar media, or broadcast
over television or radio, or (ii) any seminar or meeting to which such Purchaser was invited by any of the foregoing means of communications.


 


(h)          Accredited
Investor. At the time such Purchaser was offered the Securities, it was, and at the date hereof it is, an “accredited
investor” as defined in Rule 501(a) under the Securities Act, as amended by the Dodd-Frank Wall Street Reform and Consumer
Protection Act. Such Purchaser is not a registered broker-dealer under Section 15 of the Exchange Act. Such Purchaser has such
experience in business and financial matters that it is capable of evaluating the merits and risks of an investment in the Securities.
Such Purchaser acknowledges that an investment in the Securities is speculative and involves a high degree of risk.


 


(i)          Certain
Trading Activities. Other than with respect to the purchase of Securities hereunder, such Purchaser has not directly or indirectly,
nor has any Person acting on behalf of or pursuant to any understanding with such Purchaser, engaged in any transactions in the
securities of the Company (including, without limitation, any short sales (as defined in Rule 200 promulgated under Regulation
SHO under the Exchange Act) involving the Company’s securities) since the time that such Purchaser was first contacted by
the Company, the Placement Agents or any other Person regarding the specific investment contemplated hereby. Such Purchaser covenants
that neither it nor any Person acting on its behalf or pursuant to any understanding with it will engage in any purchase or sale
of securities of the Company (including short sales) other than with respect to the purchase of Securities hereunder prior to the
time that the transactions contemplated by this Agreement are first publicly disclosed. Notwithstanding the foregoing, in the case
of a Purchaser that is a multi-managed investment vehicle whereby separate portfolio managers manage separate portions of such
Purchaser’s assets and the portfolio managers have no direct knowledge of the investment decisions made by the portfolio
managers managing other portions of such Purchaser’s assets, the representation and covenant set forth above shall apply
only with respect to the portion of assets managed by the portfolio manager that has knowledge about the financing transaction
contemplated by this Agreement. Other than to other Persons party to this Agreement and the Placement Agents or their, or their
affiliates’, respective employees, representative and affiliates, such Purchaser has maintained the confidentiality of all
disclosures made to it in connection with this transaction (including the existence and terms of this transaction). Notwithstanding
the foregoing, for avoidance of doubt, nothing contained herein shall constitute a representation or warranty, or preclude any
actions, with respect to the identification of the availability of, or securing of, available shares to borrow in order to effect
short sales or similar transactions in the future.


 




    	 	-15-	 



     


    

 


(j)           Compliance.
To its knowledge, no part of the funds being used by such Purchaser to acquire the Securities has been, or shall be, directly or
indirectly derived from any activity that may contravene United States federal or state or non-United States laws or regulations
applicable to such Purchaser, including, without limitation, applicable Money Laundering Laws.


 


(k)          Ownership
Percentage. The number of Common Shares that such Purchaser proposes to purchase hereunder, when added to any shares of Common
Stock beneficially owned by such Purchaser immediately prior to this offering, does not exceed, in the aggregate, 11,611,900 shares
of Common Stock.


 


(l)          Acknowledgements
Regarding Placement Agents by each Purchaser.


 


(i)          The
Purchaser acknowledges that the Placement Agents are acting as Placement Agents on a “best efforts” basis for the Securities
being offered hereby and will be compensated by the Company for acting in such capacity. The Purchaser represents that (i) the
Purchaser was contacted regarding the sale of the Securities by a Placement Agent or the Company (or an authorized agent or representative
thereof) with whom the Purchaser entered into a verbal or written confidentiality agreement; and (ii) no Securities were offered
or sold to it by means of any form of general solicitation or general advertising as such terms are used in Regulation D of the
Securities Act.


 


(ii)         The
Purchaser represents that it is making this investment based on the results of its own due diligence investigation of the Company,
and has not relied on any information or advice furnished by or on behalf of the Placement Agents in connection with the transactions
contemplated hereby. The Purchaser acknowledges that the Placement Agents have not made, and will not make, any representations
and warranties with respect to the Company or the transactions contemplated hereby, and the Purchaser will not rely on any statements
made by the Placement Agents, orally or in writing, to the contrary.


 


Section
2.3           Exculpation of the Placement Agents. Each party
acknowledges that it has read the notice available at http://www.jefferies.com/CMSFiles/Jefferies.com/files/Reg%20A%20and%20D%20Disclosure%207_2014(1).pdf
and the information set forth on Exhibit D to this Agreement and hereto agrees for the express benefit of each of the Placement
Agents, its affiliates and its representatives that:


 


(a)          Neither
the Placement Agents nor any of their affiliates or any of their representatives (i) has any duties or obligations other than those
specifically set forth herein or in the engagement letter, dated as of June 1, 2016 among the Company, Jefferies LLC and Piper
Jaffray & Co. (the “Engagement Letter”); (ii) shall be liable for any improper payment made in accordance
with the information provided by the Company; (iii) makes any representation or warranty, or has any responsibilities as to the
validity, accuracy, value or genuineness of any information, certificates or documentation delivered by or on behalf of the Company
pursuant to this Agreement or the Transaction Documents or in connection with any of the transactions contemplated hereby and thereby;
or (iv) shall be liable (A) for any action taken, suffered or omitted by any of them in good faith and reasonably believed to be
authorized or within the discretion or rights or powers conferred upon it by this Agreement or any Transaction Documents or (B)
for anything which any of them may do or refrain from doing in connection with this Agreement or any Transaction Documents, except
for such party’s own gross negligence, willful misconduct or bad faith.


 




    	 	-16-	 



     


    

 


(b)          Each
of the Placement Agents, their affiliates and their representatives shall be entitled to (i) rely on, and shall be protected in
acting upon, any certificate, instrument, notice, letter or any other document or security delivered to any of them by or on behalf
of the Company, and (ii) be indemnified by the Company for acting as a Placement Agent hereunder pursuant the indemnification provisions
set forth in the Engagement Letter.


 


ARTICLE III


 


Covenants


 


The Company covenants with
each Purchaser as follows, which covenants are for the benefit of each Purchaser and their respective permitted assignees.


 


Section
3.1           Securities Compliance. The Company shall notify
the Commission, in accordance with its rules and regulations, of the transactions contemplated by any of the Transaction Documents,
and shall take all other necessary action and proceedings as may be required and permitted by applicable law, rule and regulation,
for the legal and valid issuance of the Securities to the Purchasers, or their respective subsequent holders.


 


Section
3.2           Listing of Common Stock. The Company hereby
agrees to use best efforts to maintain the listing or quotation of the Common Stock on The Nasdaq Stock Market, and, prior to the
Closing, the Company shall apply to list or quote all of the Common Shares and the Underlying Shares on such trading market and
promptly secure the listing of all of the Underlying Shares on such trading market. The Company further agrees, if the Company
applies to have the Common Stock traded on any other trading market, it will then include in such application all of the Underlying
Shares, and will take such other action as is necessary to cause all of the Underlying Shares to be listed or quoted on such other
trading market as promptly as possible. The Company will then take all action reasonably necessary to continue the listing or quotation
and trading of its Common Stock on a trading market and will comply in all respects with the Company’s reporting, filing
and other obligations under the bylaws or rules of the trading market.


 


Section
3.3           Keeping of Records and Books of Account. The
Company shall keep adequate records and books of account, in which complete entries will be made in accordance with GAAP consistently
applied, reflecting all financial transactions of the Company, and in which, for each fiscal year, all proper reserves for depreciation,
depletion, obsolescence, amortization, taxes, bad debts and other purposes in connection with its business shall be made.


 


Section
3.4           Use of Proceeds. The Company will use the net
proceeds from the sale of the Securities to repay existing indebtedness, research and development of its product candidates, and
for working capital purposes and not for the redemption of any Common Stock, debentures, preferred stock, rights, options, warrants
or other instrument that is at any time convertible into or exchangeable for, or otherwise entitles the holder thereof to receive
Common Stock.


 




    	 	-17-	 



     


    

 


Section
3.5           Reservation of Shares of Common Stock. So long
as the Preferred Shares remain outstanding, the Company shall take all action necessary to at all times have authorized, and reserved
for the purpose of issuance, the maximum number of shares of Common Stock to effect the conversion of the Preferred Shares.


 


Section
3.6           Disclosure of Transactions and Other Material Information.
On or before 8:30 a.m., New York City time, on the Business Day immediately following the Closing Date, the Company shall file
a Current Report on Form 8-K (including all attachments, the “8-K Filing”) with the Commission describing the
terms of the transactions contemplated by the Transaction Documents and including as exhibits to such Current Report on Form 8-K
this Agreement, the Certificate of Designation, and the Registration Rights Agreement in the form required by the Exchange Act
and reviewed by counsel to the Lead Investor (as defined in Section 3.13 hereto) and counsel to the Placement Agents. As
of the time of the filing of the 8-K Filing with the Commission, no Purchaser shall be in possession of any material, nonpublic
information received from the Company or any of their respective officers, directors, employees or agents, that is not disclosed
in the 8-K Filing. The Company shall not, and shall cause each of its respective officers, directors, employees and agents not
to, provide any Purchaser with any material, nonpublic information regarding the Company from and after the filing of the 8-K Filing
with the Commission without the express written consent of such Purchaser. Subject to the foregoing, neither the Company nor any
Purchaser shall issue any press releases or any other public statements with respect to the transactions contemplated hereby except
as may be reviewed and approved by the Company and counsel to the Lead Investor and counsel to the Placement Agents; provided,
however, that the Company shall be entitled, without the prior approval of any Purchaser, to make any press release or other
public disclosure with respect to such transactions (i) in substantial conformity with the 8-K Filing and contemporaneously therewith,
and (ii) as is required by applicable law and regulations (provided that in the case of clause (i) above, Purchaser and the Placement
Agents shall be notified by the Company (although the consent of such Purchaser and the Placement Agents shall not be required)
in connection with any such press release or other public disclosure prior to its release).


 


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


 


Section
3.8           Form D; Blue Sky Filings. The Company agrees
to timely file a Form D with respect to the Securities as required under Regulation D and to provide a copy thereof, promptly upon
request of any Purchaser. The Company, on or before the Closing, shall take such action as the Company shall reasonably determine
is necessary in order to obtain an exemption for, or to qualify the Securities for, sale to the Purchasers at the Closing under
applicable securities or “Blue Sky” laws of the states of the United States, and shall provide evidence of such actions
promptly upon request of any Purchaser.


 




    	 	-18-	 



     


    

 


Section
3.9           Furnishing of Information; Public Information.


 


(a)          Until
the time that no Purchaser owns Securities, the Company covenants to maintain the registration of the Common Stock under Section
12(b) or 12(g) of the Exchange Act and to timely file (or obtain extensions in respect thereof and file within the applicable grace
period) all reports required to be filed by the Company after the date hereof pursuant to the Exchange Act even if the Company
is not then subject to the reporting requirements of the Exchange Act.


 


(b)          At
any time during the period commencing from the six (6) month anniversary of the date hereof and ending at such time that all of
the Securities may be sold without the requirement for the Company to be in compliance with Rule 144(c)(1) and otherwise without
restriction or limitation pursuant to Rule 144, if the Company shall fail for any reason to satisfy the current public information
requirement under Rule 144(c) (a “Public Information Failure”) then, in addition to such Purchaser’s other
available remedies, the Company shall pay to a Purchaser, in cash, as partial liquidated damages and not as a penalty, by reason
of any such delay in or reduction of its ability to sell the Securities, an amount in cash equal to two percent (2.0%) of the aggregate
Purchase Price of such Purchaser’s Securities on the day of a Public Information Failure and on every thirtieth (30th) day
(pro rated for periods totaling less than thirty days) thereafter until the earlier of (a) the date such Public Information Failure
is cured and (b) such time that such public information is no longer required for the Purchasers to transfer the Common Shares
and the Underlying Shares pursuant to Rule 144. The payments to which a Purchaser shall be entitled pursuant to this Section 3.9
are referred to herein as “Public Information Failure Payments.” Public Information Failure Payments shall be
paid on the earlier of (i) the last day of the calendar month during which such Public Information Failure Payments are incurred
and (ii) the third (3rd) trading day after the event or failure giving rise to the Public Information Failure Payments is cured.
In the event the Company fails to make Public Information Failure Payments in a timely manner, such Public Information Failure
Payments shall bear interest at the rate of 1.5% per month (prorated for partial months) until paid in full. Nothing herein shall
limit such Purchaser’s right to pursue actual damages for the Public Information Failure, and such Purchaser shall have the
right to pursue all remedies available to it at law or in equity including, without limitation, a decree of specific performance
and/or injunctive relief. Notwithstanding the foregoing, the aggregate amount of Public Information Payments due hereunder shall
not exceed twelve percent (12.0%) of the aggregate Purchase Price of such Purchaser’s Securities.


 


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


 




    	 	-19-	 



     


    

 


Section
3.11         Equal Treatment of Purchasers. No consideration (including
any modification of any Transaction Document) shall be offered or paid to any Person to amend or consent to a waiver or modification
of any provision of this Agreement unless the same consideration is also offered to all of the parties to this Agreement. For clarification
purposes, this provision constitutes a separate right granted to each Purchaser by the Company and negotiated separately by each
Purchaser, and is intended for the Company to treat the Purchasers as a class and shall not in any way be construed as the Purchasers
acting in concert or as a group with respect to the purchase, disposition or voting of Securities or otherwise.


 


Section
3.12         Conversion and Exercise Procedures. The form of Notice
of Conversion included in the Certificate of Designation set forth the totality of the procedures required of the Purchasers in
order to convert the Preferred Stock. No additional legal opinion, other information or instructions shall be required of the Purchasers
to convert their Preferred Stock. The Company shall honor conversions of the Preferred Stock and shall deliver Underlying Shares
in accordance with the terms, conditions and time periods set forth in the Transaction Documents.


 


Section
3.13         Board Provisions.


 


(a)          The
Company further agrees that, as of the Closing Date:


 


(i)          the
number of directors constituting the full Board will be increased by the Board from five to seven directors;


 


(ii)         Mr.
Wayne P. Rothbaum will be appointed to the Board as the Interim Chairman to fill one of the vacant directorships;


 


(iii)        Mr.
Iain Dukes will be appointed to the Board to fill the other vacant directorship.


 


(b)          From
and after the date of the appointments of Messrs. Rothbaum and Dukes until the earlier of (i) date as of which Quogue Capital,
LLC (the “Lead Investor” or “Quogue”) beneficially owns less than 5.0% of the Company's outstanding
common stock or (ii) June 30, 2017 (such period, the “Effective Period”), the Company shall take no other action
to (i) otherwise change the size (whether by increase or decrease) of the Board, other than as contemplated herein, (ii) amend,
in any respect, the Articles or Bylaws of the Company, other than as contemplated herein or (iii) enter into any agreement
to do any of the foregoing, in each case, without the prior written consent of the Lead Investor.


 


(c)          During
the Effective Period, Quogue shall have the right to have two representatives designated by Quogue (the “Quogue Designees”)
included in the Board's slate nominated for election to the Board, and the Board will duly adopt a resolution nominating such representatives
for election to the Board at each annual meeting of the Company's stockholders during the Effective Period and directing the Company
and its officers and agents to solicit votes for the election of each of the Quogue Designees included in the Board's slate in
the same manner.


 




    	 	-20-	 



     


    

 


(d)          If,
during the Effective Period, any Quogue Designee is unable or unwilling to continue to serve on the Board and as a result there
is a vacancy created on the Board, the Board shall, consistent with its fiduciary duties, appoint a replacement designated by Quogue
to fill the resulting vacancy. In addition, Quogue shall have the right to designate a replacement Quogue Designee, for election
to the Board at any meeting of Company stockholders during the Effective Period, upon notice to the Company.


 


(e)          During
the Effective Period the Board shall, consistent with its fiduciary duties, (a) nominate such Quogue Designee for election at such
annual stockholders meeting, (b) recommend and support each such Quogue Designee's election to the Board as described in Section
3.13(c); and (c) appoint such Quogue Designees to the committees of the Board as described in Section 3.13(f).


 


(f)          During
the Effective Period, the Board will appoint one of the Quogue Designees to each of the Compensation Committee, Audit Committee,
and Nominating and Governance Committee. If, at any time during the Effective Period, the Board forms a committee of the Board
to evaluate, negotiate or approve an extraordinary transaction involving a possible change in control of the Company, the sale
of all or substantially all or a material portion of the assets of the Company, or any other material transaction out of the ordinary
course of business, the Board will offer to appoint the Quogue Designees to serve on any such committee.


 


(g)          Notwithstanding
the foregoing or anything to the contrary herein, nothing in this Agreement shall in any way limit Quogue's rights as a stockholder
to freely vote its securities on any matter.


 


(h)          The
Quogue Designees, upon appointment or election to the Board, will be provided the same protections, rights and benefits, including
(but not limited to) with respect to insurance, indemnification, compensation and fees, and will have the same obligations regarding
confidentiality, conflicts of interests, fiduciary duties, trading and disclosure policies and other governance guidelines, as
are applicable to all non-management directors of the Company. Promptly following the appointment of the Quogue Designees to the
Board, the Company and each of the Quogue Designees will enter into the Company’s standard indemnification agreement.


 


(i)          The
provisions of this Section 3.14 may only be modified through a written agreement signed by the Company and by Quogue.


 


(j)          The
Company acknowledges and agrees that irreparable harm to Quogue would occur in the event any of the provision of Section 3.14 were
not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that Quogue shall be
entitled to specific relief hereunder, including, without limitation, an injunction or injunctions to prevent and enjoin breach
of the provisions of Section 3.14 and to enforce specifically the terms and provisions hereof in the Court of Chancery or any federal
court in the State of Delaware, in addition to any other remedy to which they may be entitled at law or in equity. Any requirements
for the securing or posting of any bond with such remedy are hereby waived.


 




    	 	-21-	 



     


    

 


ARTICLE IV


 


Conditions


 


Section
4.1           Conditions Precedent to the Obligation of the Company
to Close and to Sell the Shares. The obligation hereunder of the Company to close and issue and sell the Shares to the Purchasers
on the Closing Date is subject to the satisfaction or waiver, at or before the Closing, of the conditions set forth below. These
conditions are for the Company’s sole benefit and may be waived by the Company at any time in its sole discretion.


 


(a)          Accuracy
of the Purchasers’ Representations and Warranties. The representations and warranties of each Purchaser shall be true
and correct in all material respects as of the date when made and as of the Closing Date as though made at that time, except for
representations and warranties that are expressly made as of a particular date, which shall be true and correct in all material
respects as of such date.


 


(b)          Performance
by the Purchasers. Each Purchaser shall have performed, satisfied and complied in all material respects with all covenants,
agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Purchasers at or prior
to the Closing Date.


 


(c)          No
Injunction. No statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated
or endorsed by any court or governmental authority of competent jurisdiction which prohibits the consummation of any of the transactions
contemplated by this Agreement.


 


(d)          Delivery
of Purchase Price. The Purchase Price for the Shares shall have been delivered to the Company at the Closing.


 


(e)          Delivery
of Transaction Documents. The Transaction Documents to which the Purchasers are party shall have been duly executed and delivered
by the Purchasers to the Company.


 


(f)          Nasdaq
Qualification. The Common Shares and the Underlying Shares to be issued shall be duly authorized for listing by The Nasdaq
Stock Market, subject to official notice of issuance, to the extent required by the rules of The Nasdaq Stock Market.


 


(g)          Series
A Consent. The Company shall have received the consent of at least a majority of shares of Series A Convertible Preferred Stock
outstanding as to the authorization or creation of a new class of preferred stock of the Company.


 


Section
4.2           Conditions Precedent to the Obligation of the Purchasers
to Close and to Purchase the Shares. The obligation hereunder of the Purchasers to purchase the Shares and consummate the transactions
contemplated by this Agreement is subject to the satisfaction or waiver, at or before the Closing, of each of the conditions set
forth below. These conditions are for the Purchasers’ sole benefit and may be waived by the Purchasers at any time in their
sole discretion.


 




    	 	-22-	 



     


    

 


(a)          Accuracy
of the Company’s Representations and Warranties. Each of the representations and warranties of the Company in this Agreement
and the Registration Rights Agreement shall be true and correct in all material respects as of the Closing Date, except for representations
and warranties that speak as of a particular date, which shall be true and correct in all material respects as of such date.


 


(b)          Performance
by the Company. The Company shall have performed, satisfied and complied in all respects with all covenants, agreements and
conditions required by this Agreement to be performed, satisfied or complied with by the Company at or prior to the Closing Date.


 


(c)          No
Suspension, Etc. Trading in the Common Stock shall not have been suspended by the Commission (except for any suspension of
trading of limited duration agreed to by the Company, which suspension shall be terminated prior to the Closing), and, at any time
prior to the Closing Date, trading in securities generally as reported by Bloomberg L.P. (“Bloomberg”) shall
not have been suspended or limited, or minimum prices shall not have been established on securities whose trades are reported by
Bloomberg, nor shall a banking moratorium have been declared either by the United States or Nevada State authorities, nor shall
there have occurred any national or international calamity or crisis of such magnitude in its effect on any financial market which,
in each case, in the reasonable judgment of the Purchasers, makes it impracticable or inadvisable to purchase the Securities.


 


(d)          No
Injunction. No statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated
or endorsed by any court or governmental authority of competent jurisdiction which prohibits the consummation of any of the transactions
contemplated by this Agreement.


 


(e)          No
Proceedings or Litigation. No action, suit or proceeding before any arbitrator or any governmental authority shall have been
commenced, and no investigation by any governmental authority shall have been threatened, against the Company, or any of the officers,
directors or affiliates of the Company, seeking to restrain, prevent or change the transactions contemplated by this Agreement,
or seeking damages in connection with such transactions.


 


(f)          Reservation
of Shares of Common Stock. As of the Closing Date, the Company shall have reserved out of its authorized and unissued Common
Stock, solely for the purpose of effecting the conversion of the Preferred Shares, a number of shares of Common Stock equal to
the number of Underlying Shares issuable upon conversion of the Preferred Shares.


 


(g)          Secretary’s
Certificate. The Company shall have delivered to the Purchasers a secretary’s certificate, dated as of the Closing Date,
as to (i) resolutions adopted by the Board consistent with Section 2.1(b), (ii) resolutions adopted by the Board as contemplated
by Section 3.13, (iii) the Articles and the Bylaws, each as in effect at the Closing, and (iv) the authority and incumbency of
the officers of the Company executing the Transaction Documents and any other documents required to be executed or delivered in
connection therewith.


 




    	 	-23-	 



     


    

 


(h)         Officer’s
Certificate. On the Closing Date, the Company shall have delivered to the Purchasers a certificate of an executive officer
of the Company, dated as of the Closing Date, confirming the accuracy of the Company’s representations, warranties and covenants
as of the Closing Date and confirming the compliance by the Company with the conditions precedent set forth in this Section 4.2
as of the Closing Date.


 


(i)          Fees
and Expenses. As of the Closing Date, all fees and expenses related to this Agreement and the transactions contemplated hereby
and required to be paid by the Company, shall have been or authorized to be paid by the Company as of the Closing Date.


 


(j)          Registration
Rights Agreement. As of the Closing Date, the parties shall have entered into the Registration Rights Agreement in the Form
of Exhibit C attached hereto.


 


(k)          Certificate
of Designation. As of the Closing Date, the Certificate of Designation shall have been filed with the Secretary of State of
Nevada.


 


(l)          Legal
Opinions. The Company shall have delivered to the Purchasers a legal opinion, dated as of the Closing Date, from (i) TroyGould
PC, counsel for the Company, in a form mutually agreed-upon by the parties, and (ii) Sklar Williams PLLC, Nevada counsel for the
Company, in a form mutually agreed-upon by the parties.


 


(m)         Material
Adverse Effect. No Material Adverse Effect shall have occurred.


 


(n)          Blue
Sky. The Company shall have obtained all necessary “Blue Sky” law permits and qualifications, or secured exemptions
therefrom, required by any state or foreign or other jurisdiction for the offer and sale of the Shares.


 


ARTICLE V


 


Transfer Restrictions;
Certificate Legend; Post-Closing Covenants


 


Section
5.1           Transfer Restrictions. The Securities may only
be disposed of in compliance with state and federal securities laws. In connection with any transfer of Securities other than pursuant
to an effective registration statement or Rule 144 or to the Company, the Company may require the transferor thereof to provide
to the Company an opinion of counsel selected by the transferor and reasonably acceptable to the Company, the form and substance
of which opinion shall be reasonably satisfactory to the Company, to the effect that such transfer does not require registration
of such transferred Securities under the Securities Act and, as a condition of such transfer, any such transferee shall agree in
writing to be bound by the terms of this Agreement and the Registration Rights Agreement and shall have the rights and obligations
of a Purchaser under this Agreement and the Registration Rights Agreement.


 


Section
5.2           Legend. Each certificate representing the Shares
shall be stamped or otherwise imprinted with a legend substantially in the following form (in addition to any legend required by
applicable state securities or “blue sky” laws):


 




    	 	-24-	 



     


    

 


THE SECURITIES REPRESENTED BY THIS
CERTIFICATE (THE “SECURITIES”) HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”) OR ANY STATE SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER THE
SECURITIES ACT AND UNDER APPLICABLE STATE SECURITIES LAWS OR LION BIOTECHNOLOGIES, INC. SHALL HAVE RECEIVED AN OPINION OF ITS COUNSEL
THAT REGISTRATION OF SUCH SECURITIES UNDER THE SECURITIES ACT AND UNDER THE PROVISIONS OF APPLICABLE STATE SECURITIES LAWS IS NOT
REQUIRED.


 


(a)          The
Company acknowledges and agrees that a Purchaser may from time to time pledge pursuant to a bona fide margin agreement with a registered
broker-dealer or grant a security interest in some or all of the Securities to a financial institution that is an “accredited
investor” as defined in Rule 501(a) under the Securities Act and who agrees to be bound by the provisions of this Agreement
and the Registration Rights Agreement and, if required under the terms of such arrangement, such Purchaser may transfer pledged
or secured Securities to the pledgees or secured parties. Such a pledge or transfer would not be subject to approval of the Company
and no legal opinion of legal counsel of the pledgee, secured party or pledgor shall be required in connection therewith. Further,
no notice shall be required of such pledge. At the appropriate Purchaser’s expense, the Company will execute and deliver
such reasonable documentation as a pledgee or secured party of Securities may reasonably request in connection with a pledge or
transfer of the Securities, including, if the Securities are subject to registration pursuant to the Registration Rights Agreement,
the preparation and filing of any required prospectus supplement under Rule 424(b)(3) under the Securities Act or other applicable
provision of the Securities Act to appropriately amend the list of Selling Stockholders (as defined in the Registration Rights
Agreement) thereunder.


 




    	 	-25-	 



     


    

 


(b)          Certificates
evidencing the Common Shares and the Underlying Shares shall not contain any legend (including the legend set forth in this Section
5.2), (i) while a registration statement covering the resale of such security is effective under the Securities Act, (ii) following
any sale of such Common Shares or Underlying Shares pursuant to Rule 144, (iii) if such Common Shares or Underlying Shares are
eligible for sale under Rule 144, without the requirement for the Company to be in compliance with the current public information
required under Rule 144 as to such Common Shares and Underlying Shares and without volume or manner-of-sale restrictions, or (iv)
if such legend is not required under applicable requirements of the Securities Act (including judicial interpretations and pronouncements
issued by the staff of the Commission). The Company shall cause its counsel to issue a legal opinion to its transfer agent promptly
if required by the transfer agent to effect the removal of the legend hereunder. If all or any portion of Preferred Shares are
converted at a time when there is an effective registration statement to cover the resale of the Underlying Shares, or if the Common
Shares or Underlying Shares may be sold under Rule 144 and the Company is then in compliance with the current public information
required under Rule 144, or if the Common Shares or Underlying Shares may be sold under Rule 144 without the requirement for the
Company to be in compliance with the current public information required under Rule 144 as to such Common Shares or Underlying
Shares or if such legend is not otherwise required under applicable requirements of the Securities Act (including judicial interpretations
and pronouncements issued by the staff of the Commission) then such Common Shares and Underlying Shares shall be issued free of
all legends. The Company agrees that following such time as such legend is no longer required under this Section 5.2(b), it will,
no later than three trading days following the delivery by a Purchaser to the Company or the transfer agent of a certificate representing
the Common Shares or Underlying Shares, as the case may be, issued with a restrictive legend (such third trading day, the “Legend
Removal Date”), deliver or cause to be delivered to such Purchaser a certificate representing such shares that is free
from all restrictive and other legends. The Company may not make any notation on its records or give instructions to the transfer
agent that enlarge the restrictions on transfer set forth in this Article 5. Certificates for Securities subject to legend removal
hereunder shall be transmitted by the transfer agent to the Purchaser by crediting the account of the Purchaser’s prime broker
with the Depository Trust Company System as directed by such Purchaser. If a Purchaser shall make a sale or transfer of any Common
Shares or Underlying Shares either pursuant to (x) Rule 144 or (y) a registration statement, and in each case shall have
delivered to the Company or the Company’s transfer agent the certificate representing the applicable Common Shares or Underlying
Shares containing a restrictive legend which are the subject of such sale or transfer and a representation letter in customary
form (the date of such sale or transfer and delivery being the “Share Delivery Date”) and (1) the
Company shall fail to deliver or cause to be delivered to such Purchaser a certificate representing such Common Shares or Underlying
Shares that is free from all restrictive or other legends by 6:00 p.m. (New York City time) on the third trading day on which the
Common Stock is listed or quoted for trading following the Share Delivery Date and (2) following such third trading day after
the Share Delivery Date and prior to the time such Common Shares or Underlying Shares are received free from restrictive legends,
the Purchaser, or any third party on behalf of such Purchaser, purchases (in an open market transaction or otherwise) shares of
Common Stock to deliver in satisfaction of a sale by the Purchaser of such Common Shares, Underlying, Shares or Underlying Shares
(a “Buy-In”), then, in addition to any other rights available to the Purchaser under the Transaction
Documents and applicable law, the Company shall pay in cash to the Purchaser (for costs incurred either directly by such Purchaser
or on behalf of a third party) the amount by which the total purchase price paid for Common Stock as a result of the Buy-In (including
brokerage commissions, if any) exceed the proceeds received by such Purchaser as a result of the sale to which such Buy-In relates.
The Purchaser shall provide the Company written notice indicating the amounts payable to the Purchaser in respect of the Buy-In.
The Company may not make any notation on its records or give instructions to any transfer agent of the Company that enlarge the
restrictions on transfer set forth in this Section.


 


Section
5.3           Compliance With Sales Provisions. Each Purchaser,
severally and not jointly with the other Purchasers, agrees with the Company that such Purchaser will sell any Securities pursuant
to either the registration requirements of the Securities Act, including any applicable prospectus delivery requirements, or an
exemption therefrom, and that if Securities are sold pursuant to a registration statement, they will be sold in compliance with
the plan of distribution set forth therein, and acknowledges that the removal of the restrictive legend from certificates representing
Securities as set forth in Section 5.2 is predicated upon the Company’s reliance upon this understanding.


 




    	 	-26-	 



     


    

 


Section
5.4           Proxy Statement


 


(a)          As
promptly as practicable after the execution of this Agreement, but in no event later than 30 days after the Closing Date, the Company
shall prepare and file with the Commission a definitive proxy statement (the “Proxy Statement”) for a stockholders
meeting scheduled to be held no later than 90 days after the Closing Date.


 


(b)          The
Proxy Statement shall include a proposal to permit the Preferred Shares to become convertible into shares of Common Stock as set
forth in, and to the extent permitted by the Certificate of Designation, and the issuance of the Underlying Shares upon such conversion,
which issuance of shares, when aggregated with the Common Shares, may exceed 20% of the outstanding Common Stock prior to the date
of this Agreement. The Proxy Statement shall include the recommendation of the Board to its stockholders that they vote in favor
of adoption of the foregoing proposal.


 


(c)          The
Company shall give counsel to the Lead Investor a reasonable opportunity to review and comment on the Proxy Statement each time
before that document (or any amendment or supplement thereto) is filed with the Commission, and reasonable and good faith consideration
shall be given to any comments made by counsel. The Company shall (i) promptly provide such counsel with any comments or other
communications, whether written or oral, that the Company may receive from the Commission or its staff with respect to the Proxy
Statement promptly after receipt of those comments or other communications and (ii) provide such counsel with a reasonable opportunity
to participate in the response to those comments and to provide comments on that response (to which reasonable and good faith consideration
shall be given), including by participating in any discussions or meetings with the Commission. Thereafter, the Company shall promptly
respond to such comments and file any amendments thereto.


 


ARTICLE VI


 


Termination


 


Section
6.1           Termination by Mutual Consent. This Agreement
may be terminated at any time prior to the Closing Date:


 


(a)          by
the mutual written consent of the Company and the Purchasers who subscribed for a majority of the Securities (on an as-converted
basis); and


 


(b)          by
the Company or a Purchaser (as to itself but no other Purchaser) upon written notice to the other, if the Closing shall not have
taken place by 5:30 p.m. Eastern time on June 10, 2016; provided, that the right to terminate this Agreement under this
Section 6.1(b) shall not be available to any Person whose failure to comply with its obligations under this Agreement has been
the cause of or resulted in the failure of the Closing to occur on or before such time.


 


Section
6.2           Effect of Termination. In the event of termination
by the Company or the Purchasers, written notice thereof shall forthwith be given to the other party and the transactions contemplated
by this Agreement shall be terminated without further action by any party. If this Agreement is terminated as provided in Section
6.1 herein, this Agreement shall become void and of no further force and effect, except for Sections 7.1, 7.2 and 7.3. Nothing
in this Section 6.2 shall be deemed to release the Company or any Purchaser from any liability for any breach under this Agreement,
or to impair the rights of the Company or such Purchaser to compel specific performance by the other party of its obligations under
this Agreement.


 




    	 	-27-	 



     


    

 


ARTICLE VII


 


Miscellaneous


 


Section
7.1           Fees and Expenses. Each party shall pay the
fees and expenses of its advisors, counsel, accountants and other experts, if any, and all other expenses, incurred by such party
incident to the negotiation, preparation, execution, delivery and performance of this Agreement; provided, however,
that the Company shall pay all fees and expenses (including attorneys’ fees and expenses) incurred by the Lead Investor in
connection with the preparation, negotiation, execution, delivery and performance of this Agreement and the other Transaction Documents
and the transactions contemplated thereunder up to an aggregate maximum of $100,000, regardless of whether or not the Closing occurs
(unless the failure of the Closing to occur is a result of a breach by any Purchaser of this Agreement, in which event the Company
shall not be required to pay any of such fees or expenses). In addition, the Company shall pay all reasonable fees and expenses
incurred by the Purchasers in connection with any amendments, modifications or waivers of this Agreement or any of the other Transaction
Documents or incurred in connection with the enforcement of this Agreement and any of the other Transaction Documents, following
a breach by the Company of this Agreement or any of the other Transaction Documents, including, without limitation, all reasonable
attorneys’ fees, disbursements and expenses.


 


Section
7.2           Indemnification of Purchasers. Subject to the
provisions of this Section 7.2, the Company will indemnify and hold each Purchaser and its directors, officers, shareholders, members,
partners, employees and agents (and any other Persons with a functionally equivalent role of a Person holding such titles notwithstanding
a lack of such title or any other title), each Person who controls such Purchaser (within the meaning of Section 15 of the Securities
Act and Section 20 of the Exchange Act), and the directors, officers, shareholders, agents, members, partners or employees (and
any other Persons with a functionally equivalent role of a Person holding such titles notwithstanding a lack of such title or any
other title) of such controlling Persons (each, a “Purchaser Party”) harmless from any and all losses that any
such Purchaser Party may suffer or incur as a result of or relating to (a) any material breach of any of the representations, warranties,
covenants or agreements made by the Company in this Agreement or in the other Transaction Documents or (b) any action instituted
against the Purchaser Parties in any capacity, or any of them or their respective affiliates, by any stockholder of the Company
who is not an affiliate of such Purchaser Parties, with respect to any of the transactions contemplated by the Transaction Documents
(unless such action is based upon a breach of such Purchaser Party’s representations, warranties or covenants under the Transaction
Documents or any agreements or understandings such Purchaser Parties may have with any such stockholder or any violations by such
Purchaser Parties of state or federal securities laws or any conduct by such Purchaser Parties which constitutes fraud, gross negligence,
willful misconduct or malfeasance). If any action shall be brought against any Purchaser Party in respect of which indemnity may
be sought pursuant to this Agreement, such Purchaser Party shall promptly notify the Company in writing, and the Company shall
have the right to assume the defense thereof with counsel of its own choosing reasonably acceptable to the Purchaser Party. Any
Purchaser Party shall have the right to employ separate counsel in any such action and participate in the defense thereof, but
the fees and expenses of such counsel shall be at the expense of such Purchaser Party except to the extent that (i) the employment
thereof has been specifically authorized by the Company in writing, (ii) the Company has failed after a reasonable period of time
to assume such defense and to employ counsel or (iii) in such action there is, in the reasonable opinion of counsel, a material
conflict on any material issue between the position of the Company and the position of such Purchaser Party, in which case the
Company shall be responsible for the reasonable fees and expenses of no more than one such separate counsel.  The Company
will not be liable to any Purchaser Party under this Agreement (y) for any settlement by a Purchaser Party effected without the
Company’s prior written consent, which shall not be unreasonably withheld or delayed; or (z) to the extent, but only to the
extent that a loss, claim, damage or liability is attributable to any Purchaser Party’s breach of any of the representations,
warranties, covenants or agreements made by such Purchaser Party in this Agreement or in the other Transaction Documents. The indemnification
required by this Section 7.2 shall be made by periodic payments of the amount thereof during the course of the investigation or
defense, as and when bills are received or are incurred. The indemnity agreements contained herein shall be in addition to any
cause of action or similar right of any Purchaser Party against the Company or others and any liabilities the Company may be subject
to pursuant to law.


 




    	 	-28-	 



     


    

 


Section
7.3           Specific Enforcement; Consent to Jurisdiction.


 


(a)          The
Company and the Purchasers acknowledge and agree that irreparable damage would occur in the event that any of the provisions of
this Agreement or the other Transaction Documents were not performed in accordance with their specific terms or were otherwise
breached. It is accordingly agreed that the parties shall be entitled to an injunction or injunctions to prevent or cure breaches
of the provisions of this Agreement or the other Transaction Documents and to enforce specifically the terms and provisions hereof
or thereof, this being in addition to any other remedy to which any of them may be entitled by law or equity.


 


(b)          The
Company and each Purchaser (i) hereby irrevocably submit to the non-exclusive jurisdiction of the United States District Court
sitting in the Southern District of New York and the courts of the State of New York located in the City of New York, for the purposes
of any suit, action or proceeding arising out of or relating to this Agreement or any of the other Transaction Documents or the
transactions contemplated hereby or thereby, and (ii) hereby waive, and agree not to assert in any such suit, action or proceeding,
any claim that it is not personally subject to the jurisdiction of such court, that the suit, action or proceeding is brought in
an inconvenient forum or that the venue of the suit, action or proceeding is improper. The Company and each Purchaser consent to
process being served in any such suit, action or proceeding by mailing a copy thereof to such party at the address in effect for
notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice
thereof. Nothing in this Section 7.3 shall affect or limit any right to serve process in any other manner permitted by law. The
Company and the Purchasers hereby agree that the prevailing party in any suit, action or proceeding arising out of or relating
to the Shares, this Agreement, or the Registration Rights Agreement, shall be entitled to reimbursement for reasonable legal fees
from the non-prevailing party.


 




    	 	-29-	 



     


    

 


Section
7.4           Entire Agreement; Amendment. This Agreement
and the Transaction Documents contain the entire understanding and agreement of the parties with respect to the matters covered
hereby and, except as specifically set forth herein or in the other Transaction Documents, neither the Company nor any Purchaser
makes any representation, warranty, covenant or undertaking with respect to such matters, and they supersede all prior understandings
and agreements with respect to said subject matter, all of which are merged herein. No provision of this Agreement may be waived
or amended other than by a written instrument signed by the Company and the holders of at least a majority in interest of the then-outstanding
Shares, and no such amendment shall be effective to the extent that it applies to less than all of the holders of the Shares then
outstanding. No consideration shall be offered or paid to any Person to amend or consent to a waiver or modification of any provision
of any of the Transaction Documents unless the same consideration is also offered to all of the parties to the Transaction Documents
or holders of Shares, as the case may be.


 


Section
7.5           Notices. Any notice, demand, request, waiver
or other communication required or permitted to be given hereunder shall be in writing and shall be effective (a) upon hand delivery,
by telecopy/facsimile or e-mail of a PDF document (with confirmation of transmission) at the address or number designated below
(if delivered on a business day during normal business hours where such notice is to be received), or the first business day following
such delivery (if delivered other than on a business day during normal business hours where such notice is to be received), or
(b) on the second business day following the date of mailing by express courier service, fully prepaid, addressed to such address,
or upon actual receipt of such mailing, whichever shall first occur. The addresses for such communications shall be:


 


	If to the Company:	 	
        Lion Biotechnologies, Inc.

        Attention: Chief Executive Officer

        112 West 34th Street, 18th Floor,

        New York, New York 10120

        Facsimile:     (212) ________

        Telephone:   (212) 946-4856

        E-mail:

         

	with copies (which copies shall not constitute notice to the Company) to:	 	
        TroyGould PC

        1801 Century Park East, 16th Floor

        Los Angeles, California 90067-2367

        Attention: Istvan Benko

        Facsimile:     (310) 201-4746

        Telephone:   (310) 553-4441

        E-mail: IBenko@troygould.com

         

	If to any Purchaser:	 	
        At the address of such Purchaser set forth on

        Exhibit A to this Agreement.

         



 




    	 	-30-	 



     


    

 


	with copies (which copies shall not constitute notice to any Purchaser) to:	 	
        Morgan, Lewis & Bockius LLP

        502 Carnegie Center

        Princeton, New Jersey 08540

        Attention: Emilio Ragosa

        Facsimile:      (609) 919-6701

        Telephone:    (609) 919-6600

        E-mail: emilio.ragosa@morganlewis.com



 


Any party hereto may from
time to time change its address for notices by giving at least ten (10) days written notice of such changed address to the other
party hereto.


 


Section
7.6           Waivers. No waiver by any party of any default
with respect to any provision, condition or requirement of this Agreement shall be deemed to be a continuing waiver in the future
or a waiver of any other provision, condition or requirement hereof, nor shall any delay or omission of any party to exercise any
right hereunder in any manner impair the exercise of any such right accruing to it thereafter.


 


Section
7.7           Headings; Interpretation. The article, section
and subsection headings in this Agreement are for convenience only and shall not constitute a part of this Agreement for any other
purpose and shall not be deemed to limit or affect any of the provisions hereof. The interpretation of this Agreement shall not
be affected by the party who drafted this Agreement, and all parties waive any statute, legal decision, or common law principle
that would require interpretation of any ambiguities in this Agreement against the party that drafted this Agreement.


 


Section
7.8           Successors and Assigns. This Agreement shall
be binding upon and inure to the benefit of the parties and their successors and assigns. After the Closing, the assignment by
a party to this Agreement of any rights hereunder shall not affect the obligations of such party under this Agreement. After the
Closing, the Purchasers may assign the Shares and their rights under this Agreement and the other Transaction Documents and any
other rights hereto and thereto without the consent of the Company, except as limited by law or otherwise required in this Agreement.


 


Section
7.9           Third Party Beneficiaries. This Agreement is
intended for the benefit of the parties hereto, their respective permitted successors and assigns and the Placement Agents, and
is not for the benefit of, nor may any provision hereof be enforced by, any other Person (other than indemnified parties, as contemplated
by Article VII).


 


Section
7.10         Governing Law. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New York, without giving effect to the choice of law provisions.
This Agreement shall not be interpreted or construed with any presumption against the party causing this Agreement to be drafted.


 


Section
7.11         Survival. The representations and warranties of the Company
and the Purchasers shall survive the execution and delivery hereof and the Closing until the date one year from the Closing Date,
and the agreements and covenants set forth in Articles I, III, V, VII and VIII of this Agreement shall survive the execution and
delivery hereof and the Closing hereunder.


 




    	 	-31-	 



     


    

 


Section
7.12         Counterparts. This Agreement may be executed in any number
of counterparts, all of which taken together shall constitute one and the same instrument and shall become effective when counterparts
have been signed by each party and delivered to the other parties hereto, it being understood that all parties need not sign the
same counterpart.


 


Section
7.13         Publicity. The Company agrees that it will not disclose,
and will not include in any public announcement, the names of the Purchasers without the consent of such Purchasers, which consent
shall not be unreasonably withheld or delayed, or unless and until such disclosure is required by law, rule or applicable regulation,
and then only to the extent of such requirement.


 


Section
7.14         Severability. The provisions of this Agreement are severable
and, in the event that any court of competent jurisdiction shall determine that any one or more of the provisions or part of the
provisions contained in this Agreement shall, for any reason, be held to be invalid, illegal or unenforceable in any respect, such
invalidity, illegality or unenforceability shall not affect any other provision or part of a provision of this Agreement and this
Agreement shall be reformed and construed as if such invalid or illegal or unenforceable provision, or part of such provision,
had never been contained herein, so that such provisions would be valid, legal and enforceable to the maximum extent possible.


 


Section
7.15         Further Assurances. From and after the date of this Agreement,
upon the request of the Purchasers or the Company, the Company and each Purchaser shall execute and deliver such instruments, documents
and other writings as may be reasonably necessary or desirable to confirm and carry out and to effectuate fully the intent and
purposes of this Agreement and the Registration Rights Agreement.


 


Section
7.16         Independent Nature of Purchasers’ Obligations and Rights.
The obligations of each Purchaser under any Transaction Document are several and not joint with the obligations of any other Purchaser,
and no Purchaser shall be responsible in any way for the performance of the obligations of any other Purchaser under any Transaction
Document. Nothing contained herein or in any other Transaction Document, and no action taken by any Purchaser pursuant hereto or
thereto, shall be deemed to constitute the Purchasers as a partnership, an association, a joint venture or any other kind of entity,
or create a presumption that the Purchasers are in any way acting in concert or as a group with respect to such obligations or
the transactions contemplated by the Transaction Documents. Each Purchaser confirms that it has independently participated in the
negotiation of the transactions contemplated hereby with the advice of its own counsel and advisors. Each Purchaser shall be entitled
to independently protect and enforce its rights, including, without limitation, the rights arising out of this Agreement or out
of any other Transaction Documents, and it shall not be necessary for any other Purchaser to be joined as an additional party in
any proceeding for such purpose.


 




    	 	-32-	 



     


    

 


Section
7.17         Payment Set Aside. To the extent that the Company makes
a payment or payments to any Purchaser pursuant to any Transaction Document or a Purchaser enforces or exercises its rights thereunder,
and such payment or payments or the proceeds of such enforcement or exercise or any part thereof are subsequently invalidated,
declared to be fraudulent or preferential, set aside, recovered from, disgorged by or are required to be refunded, repaid or otherwise
restored to the Company, a trustee, receiver or any other person under any law (including, without limitation, any bankruptcy law,
state or federal law, common law or equitable cause of action), then to the extent of any such restoration the obligation or part
thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such payment had not
been made or such enforcement or setoff had not occurred.


 


Section
7.18         Liquidated Damages. The Company’s obligations to
pay any partial liquidated damages or other amounts owing under the Transaction Documents is a continuing obligation of the Company
and shall not terminate until all unpaid partial liquidated damages and other amounts have been paid notwithstanding the fact that
the instrument or security pursuant to which such partial liquidated damages or other amounts are due and payable shall have been
canceled.


 


Section
7.19         Replacement of Securities. If any certificate or instrument
evidencing any Securities is mutilated, lost, stolen or destroyed, the Company shall issue or cause to be issued in exchange and
substitution for and upon cancellation thereof (in the case of mutilation), or in lieu of and substitution therefor, a new certificate
or instrument, but only upon receipt of evidence reasonably satisfactory to the Company of such loss, theft or destruction. The
applicant for a new certificate or instrument under such circumstances shall also pay any reasonable third-party costs (including
customary indemnity) associated with the issuance of such replacement Securities.


 


[Remainder of page intentionally left blank.
Signature pages to follow.]


 




    	 	-33-	 



     


    

 


IN WITNESS WHEREOF, the
parties hereto have caused this Agreement to be duly executed by their respective authorized officers as of the date first above
written.


 


	 	LION BIOTECHNOLOGIES, INC.
	 	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:


 


[Signatures continued on the following pages]


 


[Company signature page to Securities Purchase
Agreement] 


 




     


     


    

 


	 	“PURCHASER”
	 	___________________________________
	 	(Printed name of Purchaser)
	 	 
	 	By:                                                                     
	 	 
	 	Name:                                                                
	 	 
	 	Title:                                                                  
	 	 
	 	Number of Shares to be purchased:
	 	 
	 	Common Shares: _______   _____
	 	 
	 	Preferred Shares: ________   ____
	 	 
	 	Purchase Price: $_______________
	 	 
	 	
        Address for Notice:

        ___________________________________

	 	 
	 	___________________________________
	 	(Print address)
	 	 
	 	Telephone: _____________________
	 	 
	 	Facsimile:______________________
	 	 
	 	E-mail:_________________________
	 	 
	 	Delivery Instructions:
	 	(if different than above)
	 	 
	 	c/o _______________________________
	 	 
	 	Street: ____________________________
	 	 
	 	City/State/Zip: ______________________
	 	 
	 	Attention: __________________________
	 	 
	 	Telephone No.: 
	 	__________________________________


 


[Purchaser signature page to Securities Purchase
Agreement]


 




     


     


    

 


SCHEDULE 2.1(c)


 


Capitalization


 


Common stock: $0.000041666
par value; 150,000,000 shares authorized; 48,667,478 shares issued and outstanding as of June 2, 2016.


 


Preferred stock: $0.0001
par value, 50,000,000 shares authorized; 1,694 shares of Series A Convertible Preferred Stock were issued and outstanding and no
shares of Series B Preferred Stock were issued or outstanding, each as of June 2, 2016.


 


Stock Options: Stock options
to purchase 3,493,454 shares of Common Stock were outstanding as of June 2, 2016.


 


Warrants: Warrants to purchase
7,073,716 shares of Common Stock were issued and outstanding as of June 2, 2016.


 


Common Stock that may be
issued:


 


Commitments to Issue Additional Shares


 


None


 


Registration Rights


 


None


 


Anti-Dilution


 


The number of shares of
Common Stock to be issued upon the conversion of the Series A Convertible Preferred Stock subject to adjustment based on stock
dividends, stock splits and similar event.


 


SCHEDULE 2.1(i)


 


On June 1, 2016, Elma Hawkins
PhD. resigned as the President and Chief Executive Officer of the Company and as a member of the Board of Directors, effective
June 3, 2016. The Company intends to disclose Dr. Hawkins’ resignation in a Current Report filed on Form 8-K that is currently
scheduled to be filed on June 3, 2016. In addition to paying Dr. Hawkins the severance payments due to her under her employment
agreement, the Company agreed to extend exercise period of all of Dr. Hawkins’ stock purchase options to two years after
her resignation date. The Company also entered into a three month adviser’s agreement with Dr. Hawkins pursuant to which
Dr. Hawkins will provide advisory services to the Board and Maria Fardis PhD. was appointed as the new President and Chief Executive
Officer of the Company. Dr. Hawkins will receive $10,000 per month under the advisers agreement.


 


Effective June 1, 2016,
Maria Fardis PhD. was appointed as the new President and Chief Executive Officer of the Company. Concurrently, Dr. Fardis was appointed
as a member of the Board of Directors to fill the vacancy created by Dr. Hawkins’ resignation. The Company intends to disclose
Dr. Hawkins’ resignation in a Current Report filed on Form 8-K scheduled to be filed on June 3, 2016. Dr. Fardis entered
into an employment agreement with the Company pursuant to which she will receive an annual salary of $500,000. The Company also
agreed to pay Dr. Fardis a signing bonus of $150,000. In addition, the Company granted Dr. Fardis (i) stock options to purchase
an aggregate of 500,000 shares of the Company’s common stock, and (ii) 550,000 non-transferrable Restricted Stock Units.
The stock options will have an exercise price of $5.87, to the closing trading price of the Common Stock on June 1, 2016.


 




     


     


    

 


EXHIBIT A


 


LIST OF PURCHASERS


 


 




     


     


    

 


EXHIBIT B


 


FORM OF


CERTIFICATE OF DESIGNATION OF RIGHTS, PREFERENCES
AND PRIVILEGES OF SERIES B PREFERRED STOCK


 




     


     


    

 


EXHIBIT C


 


FORM OF REGISTRATION RIGHTS AGREEMENT


 




     


     


    

 


EXHIBIT D


 


In October 2013, Piper Jaffray entered into
a settlement of an administrative enforcement action brought by the SEC (see SEC Administrative Proceeding No. 3-15603/Securities
Act Release No. 33-9472/Exchange Act Release 34-70804), which related to Piper Jaffray’s role as an underwriter of a municipal
bond issue for the City of Wenatchee, WA (the “Settlement”). As part of the Settlement, the SEC found that Piper Jaffray
and one of its public finance bankers, Jane Towery, violated Sections 17(a)(2) and 17(a)(3) of the Securities Act of 1933, as amended
(the “Securities Act”). The Settlement also included an order censuring Piper Jaffray and Towery and ordering that
Piper Jaffray and Towery pay civil penalties in the amounts of $300,000 and $25,000, respectively. Finally, the Settlement included
an undertaking from Piper Jaffray to engage an independent consultant to review its municipal underwriting due diligence policies
and procedures and submit a written report and for Piper Jaffray thereafter to certify its compliance with the independent consultant’s
recommendations. The Settlement became effective on November 4, 2013.


 


The Staff of the SEC Division of Corporation
Finance (the “Staff”) takes the position that the inclusion of the independent consultant undertaking in the Settlement
is a “limitation on its activities” within the meaning of subparagraph (d)(1)(iv)(B) of Rule 506 of Regulation D (“Rule
506”) of the Securities Act, thereby triggering a disqualification of Piper Jaffray in terms of its ability to act as a placement
agent in connection with any private placement conducted solely under Rule 506 or as an underwriter or as an underwriter in connection
with any offering conducted under Regulation A.


 


As a result, Piper Jaffray sought and obtained
a waiver from the SEC in July 2015 (see Staff Waiver Letter dated July 20, 2015, the “Waiver”). The Waiver permits
Piper Jaffray to continue to act as a placement agent in connection with any private placement conducted under Rule 506 of Regulation
D or as an underwriter in connection with any offering conducted under Regulation A. This disclosure exhibit is being provided
to any purchaser in connection with any such placement or offering in compliance with one of the conditions of the Waiver.