Exhibit
10.13





 




CERTAIN
CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY [***], HAS BEEN OMITTED PURSUANT TO ITEM 601(B)(10)(iv) BECAUSE
IT IS BOTH (i) NOT MATERIAL AND (ii) IS THE TYPE THAT THE REGISTRANT TREATS AS PRIVATE OR CONFIDENTIAL.



 


Execution
Copy


 


SHAREHOLDERS
AGREEMENT


 


This
Shareholders Agreement (this “Agreement”) is made as of May 26, 2005 (the “Effective Date”),
by and among Lipella Pharmaceuticals Inc., a Delaware corporation (“Company”), [***], an individual resident
of [***] (“[***]”), [***], and individual resident of [***] (“[***]”), [***], an individual resident of
[***] (“[***]”), and [***], an individual resident of [***] ([***], [***], [***], and [***], together with any other
person or entity which becomes a shareholder of the Company and a party hereto are, for so long as they are shareholders of Company,
collectively referred to herein as the “Shareholders” or individually a “Shareholder.”)


 


BACKGROUND


 


The
parties have determined that it is in the best interests of Company and the Shareholders to provide for certain rights and restrictions
on the future disposition of Company’s shares of capital stock (the “Shares”), and various other matters
set forth herein.


 


NOW,
THEREFORE, in consideration of the agreements and mutual promises and covenants set forth herein, the parties hereto, intending
to be legally bound hereby, agree as follows:


 


ARTICLE
I

CERTAIN DEFINITIONS


 


In
addition to other terms defined in this Agreement, the following terms have the following definitions:


 


1.1.       “Affiliate”
shall have the meaning prescribed in Rule 405 promulgated by the Securities and Exchange Commission under the Securities Act of
1933, as amended.


 


1.2.       “As-Converted
Basis” shall mean as if all stock convertible into common stock of Company, including preferred stock, if any, were
converted into common stock of Company.


 


1.3.       “Board”
shall mean the Board of Directors of Company.


 


1.4.       “Business
Dav” shall mean any day other than a Saturday, Sunday or Federal holiday.


 


1.5.       “Change
In Control” shall mean (a) a merger or consolidation in which Company is not the surviving entity, (b) the
acquisition by any independent Person or independent affiliated group of Persons of more than 50% of the combined voting
power of the Company’s outstanding stock (on an As-Converted Basis) (excluding a financing transaction, which financing
transaction for this purpose would include an investment in Company) or (c) a transaction requiring shareholder approval and
involving the sale, lease or exchange of all or substantially all the assets of the Company to an independent third
party.


 






     


     


    

 


1.6.       “Convertible
Security” shall mean any evidence of indebtedness, share of stock, warrant or other security of Company which is directly
or indirectly convertible into or exchangeable for shares of Company’s capital stock, with or without the payment of additional
consideration or the happening of a specified event.


 


1.7.       “Established
Percentage” shall mean, with respect to the applicable Shareholder, an amount equal to the percentage determined by
dividing the number of Shares held by such Shareholder on an As-Converted Basis, by the number of Shares held by all Shareholders
on an As-Converted Basis.


 


1.8.       “Exempt
Transfer” shall mean a Transfer of Shares under the provisions of Section 2.2 of this Agreement.


 


1.9.       “Initial
Public Offering” shall mean the first firmly underwritten public offering of Company’s securities amounting to
not less than $10,000,000 in proceeds.


 


1.10.     “Person”
shall mean any individual, partnership, corporation, limited liability company, trust, joint venture, unincorporated organization
or other entity.


 


1.11.     “Prospective
Purchaser” shall mean any Person to whom Shares are or may be Transferred if such Transfer is not, in its entirety,
an Exempt Transfer.


 


1.12.     “Securities
Act” shall mean the Securities Act of 1933, as amended.


 


1.13.     “Significant
Shareholder” shall mean any Shareholder holding at least 5% of the issued and outstanding Shares on an As-Converted
Basis.


 


1.14.     “Start-up
Period” shall mean the period commencing on the Effective Date and ending on the earlier to occur of an Initial Public
Offering or a Change in Control.


 


1.15.     “Transfer”
shall mean any sale, conveyance, encumbrance, pledge or other transfer, whether voluntary, involuntary or by operation of law.


 


ARTICLE II


RESTRICTIONS
ON TRANSFER OF SHARES


 


2.1.       Restrictions
on Shareholders. No Shareholder shall Transfer any Shares now or hereafter owned (of record or beneficially) by such Shareholder
unless such Shareholder has complied with the terms and conditions of this Agreement.


 


2.2.       Certain
Permitted Transfers. The provisions of Articles III and IV of this Agreement shall not apply to the following Transfer of Shares:


 


(a)  Gifts,
bequests or transfers by any individual Shareholder to spouses, parents, siblings, children, nieces, nephews, grandchildren, trusts
for the benefit of any one or more of the foregoing or entities controlled by any one or more of the foregoing;


 






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(b)  Transfers
from an estate of any individual Shareholder to any spouse or relative of the decedent or any trust for the benefit of any one
or more of the foregoing; and


 


(c)  Transfers
by any Shareholder to any Affiliate thereof, which shall include for this purpose, as to any Person which is an entity, any direct
or indirect holders of equity thereof, including, with respect to any partnership, corporation, or limited liability company,
the general partner, limited partners, shareholders and/or members thereof, as applicable.


 


ARTICLE
III


SHAREHOLDER’S
LIMITED RIGHT TO DISPOSE OF SHARES


 


3.1.       Offer
to Sell Shares. Except as otherwise provided herein, if any Shareholder shall at any time desire to sell all or any of such
Shareholder’s Shares, such Shareholder (the “Selling Shareholder”) shall first prepare a written offer
(the “Offer”) to sell such Shares (the “Offered Shares”) setting forth the proposed date
of the sale, the proposed price per Share, and the other terms and conditions upon which the sale is proposed to be made. Such
notice shall also specify whether a Prospective Purchaser has made an Offer to acquire such Shares. The Selling Shareholder shall
then transmit a copy of the Offer to Company. Within five (5) Business Days of receipt of the Offer, Company shall transmit a
copy of the Offer to the Significant Shareholders other than the Selling Shareholder.


 


3.2.       Option
of Company. Transmittal of the Offer to Company by the Selling Shareholder shall constitute an offer by the Selling
Shareholder to sell the Selling Shareholder’s Offered Shares to Company at the price and upon the terms set forth in
the Offer. For a period of fifteen (15) days after the submission of the Offer to Company, Company shall have the option,
exercisable by written notice to the Selling Shareholder (with a copy to the Significant Shareholders), to accept the Selling
Shareholder’s Offer as to all or any part of the Selling Shareholder’s Offered Shares. Such notice shall state
the number of Shares Company will purchase, if any, and the number of Offered Shares available to be purchased.


 


3.3.       Option
of Significant Shareholders. In the event that Company does not exercise its option with respect to any or all of the
Offered Shares in accordance with Section 3.2, the Selling Shareholder, upon notice from Company to the Selling Shareholder
(with a copy to the Significant Shareholders) of Company’s decision not to accept the Offer as to any or all of the
Offered Shares (or upon expiration of the fifteen-day option period referred to in Section 3.2 if Company fails to give
notice as aforesaid), shall be deemed to have offered in writing to sell its remaining Offered Shares (those not purchased by
Company) to the Significant Shareholders at the price and upon the terms set forth in the Offer. For a period of fifteen (15)
days after such Offer to the Significant Shareholders, the Significant Shareholders shall have the option, exercisable by
written notice to the Selling Shareholder with a copy to Company and to each of the other Significant Shareholders, to accept
the Offer as to the remaining Offered Shares. Each Significant Shareholder who exercises this option shall agree, by doing
so, to purchase that proportionate part of the remaining Offered Shares that the number of Shares owned by such Significant
Shareholder bears to the total number of Shares owned by all Significant Shareholders (or in such other proportions as the
participating Significant Shareholders may agree among themselves). In the event that one or more of the Significant
Shareholders does not exercise its option in accordance with this Section, the Significant Shareholders who exercised their
options pursuant to this Section shall have a further option for a period of five (5) additional days following the
expiration of the fifteen-day period set forth in this Section to accept the Offer as to the then remaining Offered Shares,
and each such participating Significant Shareholder who exercises this further option shall agree, by doing so, to purchase
that proportionate part of the then remaining Offered Shares, which the number of Shares owned by such Significant
Shareholder bears to the total number of Shares owned by all of the participating Significant Shareholders exercising this
further option pursuant to this Section (or in such other proportions as such participating Significant Shareholders
may agree among themselves).


 






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3.4.       Sale
to Prospective Purchaser. If, at the end of the option periods described in Sections 3.2 and 3.3 (the “Option Periods”),
options have not been exercised by Company and/or the Significant Shareholders to purchase all of the Offered Shares, then the
Selling Shareholder shall be free, subject to the co-sale provisions of Section 4 hereof and the requirements of Section 6.2 hereof,
for a period of sixty (60) days thereafter to sell any or all of the Offered Shares as to which options have not been exercised
(the “Remaining Shares”) to a Prospective Purchaser at the price and upon the terms and conditions set forth
in the Offer. If such Remaining Shares are not so sold within the aforesaid sixty (60) day period, then the Selling Shareholder
shall not be permitted to sell such Remaining Shares without again complying with this Article III.


 


ARTICLE
IV 


CO-SALE
AND DRAG-ALONG PROVISIONS


 


4.1.       Notice
of Third-Party Offer. Within five (5) days of the end of the Option Periods, if there are any Remaining Shares available for
sale to the Prospective Purchaser, the Selling Shareholder shall submit a written notice (the “Co-Sale Notice”)
to the Significant Shareholders disclosing the number of Remaining Shares proposed to be sold and the total number of Shares owned
by the Selling Shareholder (including those, if any, designated for sale to Company and the Significant Shareholders pursuant
to Article III).


 


4.2.       Right
of Participation in Sales.


 


(a)  Co-Sale
Right. Upon receipt of a Co-Sale Notice from the Selling Shareholder, each Significant Shareholder shall have the right to
sell to the Prospective Purchaser, at the same price per share and on the same terms and conditions set forth in the Offer, such
number of Shares held by such Significant Shareholder (assuming a conversion if such Significant Shareholder holds stock that
is convertible into the class of stock being sold) equal to the Remaining Shares multiplied by a fraction, the numerator of which
is the aggregate number of Shares held by such Significant Shareholder on an As-Converted Basis and the denominator of which is
the sum of: (i) all Shares held by such Selling Shareholder on an As-Converted Basis (excluding those, if any, Shares designated
for sale to Company and the Significant Shareholders pursuant to Article III); and (ii) all of the Shares held by any Significant
Shareholder or Significant Shareholders on an As-Converted Basis electing to participate in such sale to the Prospective Purchaser.


 






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(b)  Notice
of Intent to Participate. If a Significant Shareholder wishes to participate in any sale under this Section 4.2, such Significant
Shareholder shall notify the Selling Shareholder in writing of such intention as soon as practicable after such Significant Shareholder’s
receipt of the Co-Sale Notice made pursuant to Section 4.1, and in any event within ten (10) days after the date of such Co-Sale
Notice has been delivered.


 


(c)  Sale
of Co-Sale Shares. The Selling Shareholder and each Significant Shareholder participating shall sell to the Prospective Purchaser
all, or, at the option of the Prospective Purchaser, any part, of the Shares proposed to be sold by them at not less than the
price and upon other terms and conditions, if any, not more favorable to the Prospective Purchaser than those in the Co-Sale Notice
provided by the Selling Shareholder under Section 4.1 above; provided that any purchase of less than all of such shares by the
Prospective Purchaser shall be made from the Selling Shareholder and each participating Offering Shareholder pro rata based upon
the relative amount of the Shares that the Selling Shareholder and each such participating Significant Shareholder is otherwise
entitled to sell pursuant to Section 4.2(a).


 


4.3.       Drag-Along
Rights. Notwithstanding Article III and Sections 4.1 and 4.2 above, if the holder or holders of at least seventy-five percent
(75%) of the issued and outstanding Shares on an As-Converted Basis, voting together as a single class (collectively, the “Initiating
Shareholder(s)”), approve a Transfer of all of the Shares held by them, such Initiating Shareholder(s) may require each
of the remaining Shareholders to sell their Shares in the manner set forth in this Section 4.3 for the same consideration and
on the same terms and conditions applicable to the Initiating Shareholder(s). The Initiating Shareholders) shall exercise their
rights pursuant to this Section 4.3 by delivering to the remaining Shareholders a written notice of such proposed Transfer no
later than ten (10) days prior to the execution of a definitive agreement with respect thereto, setting forth the name and address
of the prospective buyer, the proposed purchase price and the other terms and conditions of the proposed sale (the “Drag-
Along Notice”). Each remaining Shareholder shall thereupon be required, with respect to such Transfer, to execute and
deliver a definitive agreement consistent with the terms thereof and to deliver at the closing of such Transfer the certificate^)
representing the Shares held by such remaining Shareholders, duly endorsed for transfer, and shall be entitled to receive the
proceeds allocable to the sale thereof. In the event that a definitive agreement with respect to the transaction contemplated
by the Drag-Along Notice has not been entered into within ninety (90) days of the date of the Drag-Along Notice, the obligations
of the remaining Shareholders under this Section 4.3 shall terminate with respect to such Drag-Along Notice.


 


ARTICLE
V 


PURCHASE
PRICE. TERMS AND SETTLEMENT


 


5.1.       Purchase
Price. The purchase price per Share and the terms of payment shall be the price per Share contained in the Offer.


 


5.2.       Time;
Date: Location. Settlement for the purchase of Shares by Company or by a Shareholder pursuant to the provisions of Article
III, shall be made within thirty (30) days following the date of exercise of the last option exercised. All settlements for the
purchase and sale of Shares shall, unless otherwise agreed to by all of the purchasers and sellers, be held at die principal executive
offices of Company during regular business hours. The precise date and hour of settlement shall be fixed by the purchaser or purchasers
(within the time limits prescribed in this Agreement), or in the event the purchasers fail to agree, by the President of Company,
by notice in writing to the seller given at least five (5) days in advance of the settlement date specified.


 






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5.3.       Certificates.
At settlement, the stock certificate or certificates representing the Shares being sold shall be delivered by the seller to
the purchaser or purchasers, duly endorsed for transfer or with executed stock powers attached, with any necessary
documentary and transfer tax stamps affixed by the seller, free and clear of all liens, claims and encumbrances except for
the terms of this Agreement.


 


5.4.       Authority.
The seller, if a personal representative of a Shareholder, shall, upon request of a purchaser, provide prior to the date of settlement,
evidence reasonably satisfactory to the purchaser of the seller’s legal status as personal representative of such Shareholder.


 


ARTICLE
VI 

ADDITIONAL PROVISIONS


 


6.1.       Copy
of Agreement to Be Kept on File. Company shall keep on file at its principal executive offices, and will exhibit to any
Shareholder or his or her duly authorized representative at any and all reasonable times, an executed copy of this Agreement
and all amendments thereto.


 


6.2.       Legended
Certificates: Transfer Requirements. All certificates hereafter issued by Company shall be marked with the following legend
(or one substantially similar thereto):


 


THIS
CERTIFICATE AND THE SECURITIES REPRESENTED HEREBY ARE HELD SUBJECT TO THE TERMS, COVENANTS AND CONDITIONS OF A SHAREHOLDERS AGREEMENT
DATED AS OF MAY 26,2005 BY AND AMONG ISSUER AND ITS THEN SHAREHOLDERS, AS IT MAY BE AMENDED FROM TIME TO TIME, AND MAY NOT BE
TRANSFERRED OR DISPOSED OF EXCEPT IN ACCORDANCE WITH THE TERMS AND PROVISIONS THEREOF. A COPY OF SAID AGREEMENT AND ALL AMENDMENTS
THERETO IS ON FILE AND MAY BE INSPECTED AT THE PRINCIPAL EXECUTIVE OFFICES OF THE ISSUER.


 


Notwithstanding
any other provision hereof, except in case of a Change in Control or in the case of a Transfer pursuant to Section 4.3
hereof, no Shareholder shall Transfer Shares unless either (a) such Shares shall first have been registered under the
Securities Act pursuant to an effective registration statement filed with the Securities and Exchange Commission, or (b) the
Company shall first have been furnished with an opinion of legal counsel, reasonably satisfactory to the Company, to the
effect that such Transfer is exempt from the registration requirements of the Securities Act.


 






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6.3.       Term
of Agreement. This Agreement shall terminate upon the expiration of the Start-Up Period.


 


6.4.       Rights,
Obligations and Remedies. The Shares are unique, and recognizing that the remedy at law for any breach or threatened breach
by a party hereto of the covenants and agreements set forth in this Agreement would be inadequate and that any such breach or
threatened breach would cause such immediate and permanent damage as would be irreparable and the exact amount of which would
be impossible to ascertain, the parties hereto agree that in the event of any breach or threatened breach of any such covenant
or agreement, in addition to any and all other legal and equitable remedies which may be available, any party hereto may specifically
enforce the terms of this Agreement and may obtain temporary and/or permanent injunctive relief without the necessity of proving
actual damage by reason of any breach or threatened breach hereof and, to the extent permissible under the applicable statutes
and rules of procedure, a temporary injunction may be granted immediately upon the commencement of any such suit and without notice.


 


6.5.       Subsequent
Shareholders to Become Bound. Any person or entity who subsequently becomes a shareholder of Company (including holders of
options or warrants to acquire Common Stock upon the exercise of such option or warrant, as the case may be) shall be bound by
all of the terms and provisions of, and shall be entitled to all the benefits and privileges of this Agreement, unless otherwise
determined by the Board. Before any Person not a party to this Agreement, including any Person to whom transfers of Shares may
be made hereunder, may be entitled to become a shareholder of Company, unless otherwise determined by the Board, such Person shall
be required first to execute and deliver to Company an agreement pursuant to which such Person agrees to be bound by all of the
terms and conditions of this Agreement (as it may have then been amended), and the failure of any such Person to execute such
agreement shall preclude such person or entity from becoming a shareholder of Company.


 


6.6.       Amendment,
Modification and Termination. This Agreement may be amended, modified or terminated, or any provision or requirement hereof
waived, at any time by an agreement in writing among Company and the holders of at least seventy-five percent (75%) of the issued
and outstanding Shares on an As-Converted Basis; provided that if this Agreement is amended, modified or terminated without the
unanimous consent of the Shareholders, all Shareholders that are not a party to such agreement shall be given prompt notice of
such amendment, modification or termination. Any such amendment or waiver shall be effective with respect to all parties to this
Agreement.


 


6.7.       No
Waiver. No waiver of any breach or condition of this Agreement shall be deemed to be a waiver of any other or subsequent breach
or condition, whether of like or different nature.


 


6.8.       Governing
Law and Jurisdiction. This Agreement shall be governed by and interpreted under the laws of the State of Delaware, without
giving effect to the principles of conflicts of law of any jurisdiction. In the event that a party to this Agreement perceives
the existence of a dispute with the other party concerning any right or duty provided for herein, the parties will, as soon as
practicable, confer in an attempt to resolve the dispute. If the parties are unable to resolve such dispute amicably, then the
parties hereby submit to the exclusive jurisdiction of and venue in the state and federal courts located in Allegheny County,
Pennsylvania with respect to any and all disputes concerning the subject of, or arising out of, this Agreement.


 






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6.9.      Notices.
All notices, requests, consents and other communications hereunder shall be in writing and shall be deemed to have been duly given
(a) at the time of receipt delivered in person or by facsimile transmission (with transmission acknowledgement received), (b)
within (1) day after deposit with a nationally recognized overnight courier, specifying next day delivery, or (c) three (3) days
after being sent certified or registered mail, return receipt requested, in each case to the address or facsimile number (as the
case may be) listed for the applicable party below, or, if any party shall have designated a different address or facsimile number
by notice to the other parties in the manner provided in this Section (provided that notice of change in address and/or facsimile
number shall be deemed given only when received), then to the last address or facsimile number so designated:


 


If
to Company, to:


 


Lipella
Pharmaceuticals, Inc. 


5414
Guarino Road 


Pittsburgh,
PA 15217


Attention: President


Facsimile: 267-295-2073


 


If
to Shareholder(s), to the address set forth for each Shareholder on the signature page of this Agreement or Joinder to this Agreement.


 


6.10.    Binding
Nature of Agreement and No Assignment. This Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective heirs, personal representatives, successors and assigns, except that no party may assign or transfer its
rights or obligations under this Agreement without the prior written consent of the other parties hereto, except by means of transfers
permitted by Articles II or III or Section 4.2.


 


6.11.    Counterparts,
Headings and Exhibits Interpretation. This Agreement may be executed in two or more counterparts, each of which shall be deemed
an original, but all of which together shall constitute one and the same instrument The headings used in this Agreement are for
convenience only and are not to be considered in construing or interpreting any term or provision of this Agreement. All Schedules
and Exhibits hereto are hereby incorporated in this Agreement and made a part hereof. Unless otherwise provided herein, the word
“including” shall be interpreted as followed by the words “without limitation” or words of similar effect.


 


6.12.    Integration.
This Agreement embodies the entire agreement and understanding among the parties hereto with respect to the subject matter hereof
and supersedes all prior agreements and understandings relating to the subject matter hereof.


 






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6.13.     Severability.
If any provision of this Agreement shall be held to be illegal, invalid or unenforceable, then such illegality, invalidity or
unenforceability shall attach only to such provision and shall not in any manner affect or render illegal, invalid or unenforceable
any other provision of this Agreement, and this Agreement shall be carried out as if any such illegal, invalid or unenforceable
provision were not contained herein.


 


6.14.     Number
of Days. In computing the number of days for purposes of this Agreement, all days shall be counted, including Saturdays. Sundays
and holidays; provided that if the final day of any time period falls on a Saturday, Sunday or holiday on which Federal banks
are or may elect to be closed, then the final day shall be deemed to be the next day which is not a Saturday. Sunday or such holiday.


 


[Remainder
of this page intentionally left blank.]


 




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IN
WITNESS WHEREOF, the parties hereto have executed and delivered this Agreement as of the Effective Date.


 


		LIPELLA
                            PHARMACEUTICALS, INC.



 


	 	By:	/s/
                                         Jonathan Kaufman
	 	Name:
               Jonathan Kaufman
	 	Title:
               President



 


	 	[***]
	 	 
	 	/s/
    
	 	 
	 	Address: 	[***]
	 	 	 
	 	Facsimile: 	[***]


 


	 	[***]
	 	 
	 	/s/
    
	 	 
	 	Address: 	[***]
	 	 	 
	 	Facsimile: 	[***]


 


	 	[***]
	 	 
	 	/s/
    
	 	 
	 	Address: 	[***]
	 	 	 
	 	Facsimile:	 


 


	 	[***]
	 	 
	 	/s/
    
	 	 
	 	Address: 	[***]
	 	 	 
	 	Facsimile:	 





 






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FORM
OF




JOINDER
TO 


SHAREHOLDERS
AGREEMENT 


OF 


LIPELLA
PHARMACEUTICALS INC.


 





THIS
AGREEMENT (this “Agreement”) is made as of [DATE] (the “Agreement Date”), by and between [___]
(the “Shareholder”), and LIPELLA PHARMACEUTICALS INC. (the “Corporation”), a corporation organized
and existing under the laws of Delaware, having a mailing address of 7800 Susquehanna Street, Suite 505, Pittsburgh, PA 15208.







 


W I T N E S S E T H


 





WHEREAS,
the Corporation and its original shareholders, [___] (the “Original Shareholders”), entered into that certain Shareholders
Agreement dated May 16, 2005 (the “Shareholders Agreement”), whereby the transferability of the shares of the Corporation’s
common stock (the “Shares”) was restricted;


 


WHEREAS,
the Shareholder has purchased Shares [from/pursuant to [agreement]], executed in conjunction herewith (the each an “Assignment
Agreement”), and a condition to the receipt of [his/her/its] Shares is the Shareholder’s execution and delivery of
this Agreement;


 


WHEREAS,
the Corporation’s Board of Directors and the Original Shareholders have consented to the [sale/transfer], provided that
Shareholder execute this Agreement and agree to be bound by the terms and conditions of the Shareholders Agreement; and







 


WHEREAS,
the Shareholder agrees to become bound by the general terms of the Shareholders Agreement thereby restricting the transferability
of [his/her/its] Shares.


 


NOW,
THEREFORE, in consideration of the premises and the mutual covenants hereinafter set forth as well as those contained in the
Shareholders Agreement, and intending to be legally bound, the Corporation and the Shareholder hereby agrees as follows:


 





1.         Stock Subject to Agreement. This Agreement shall apply to the [___] ([___]) Shares [sold to/transferred from] [___]
to the Shareholder pursuant to [agreement].


 


2.         Joinder
in Shareholder Agreement. The Shareholder agrees that [he/she/it] joins in and becomes a party to the Shareholders Agreement,
a true and correct copy of which is attached hereto as Exhibit “A”. Except as provided in the Shareholders Agreement,
neither the Shareholder nor [his/her/its] personal representatives or heirs shall encumber, transfer or otherwise dispose of all
or any part of [his/her/its] Shares in the Corporation. The Shares may not be transferred to any person other than to the Corporation,
unless the Corporation is given the first opportunity to acquire such Shares, and unless the non-selling shareholders are then
given the option to purchase any Shares not purchased by the Corporation, as provided in the Shareholders Agreement. Further,
the Corporation and all of its shareholders shall have all of the rights and options with respect to the Shares as set forth in
the Shareholders Agreement. The Share certificates subject hereto shall be endorsed as follows:










 


“THIS
CERTIFICATE AND THE SECURITIES REPRESENTED HEREBY ARE HELD SUBJECT TO THE TERMS, COVENANTS AND CONDITIONS OF A SHAREHOLDERS AGREEMENT
DATED AS OF MAY 16, 2005 BY AND AMONG ISSUER AND ITS THEN SHAREHOLDERS, AS IT MAY BE AMENDED FORM TIME TO TOME, AND MAY NOT BE
TRANSFERRED OR DISPOSED OF EXCEPT IN ACCORDANCE WITH THE TERMS AND PROVISIONS THEREOF. A COPY OF SAID AGREEMENT AND ALL AMENDMENTS
THERETO IS ON FILE AND MAY BE INSPECTED AT THE PRINCIPAL EXECUTIVE OFFICES THE ISSUER.”


 






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Any
and all Shares of the Corporation hereafter issued to the Shareholder shall bear the same endorsement.


 


3.       Parties. This
Agreement shall be binding upon and shall inure to the benefit of the parties hereto, their respective heirs, personal
representatives, successors and assigns; provided, however, that no person, firm or corporation not a party hereto shall have
any rights hereunder or the power to enforce any of the duties created hereby unless such person, firm or corporation shall
have become bound to the provisions hereof.


 


4.       Separability. If
any provision of this Agreement or the application thereof shall be invalid or unenforceable, the remainder of this Agreement
and any other application of such provision shall not be affected thereby.


 


5.       Amendment.
This Agreement may be changed, waived, discharged or terminated only by written agreement of the Corporation and the Shareholder.


 


6.       Governing
Law. This Agreement is executed in and shall be construed and enforced in accordance with the laws of the State of Delaware.


 


7.       Waivers. No
failure or delay by any party in exercising any right, power or privilege under this Agreement shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, power or privilege.


 


****
Signatures on Following Page ****


 




    2


     


    

IN
WITNESS WHEREOF, and intending to be legally bound, the Shareholder and the Corporation have executed and delivered this Agreement
effective as of the day and year first above written.


 





	 	SHAREHOLDER:
	 	 
	 	 
	 	[___]




	 	 
	 	Mailing Address:
	 	 
	 	 
	 	 



 


	 	LIPELLA PHARMACEUTICALS INC.
	 	 	 
	 	By:	 
	 	 	Jonathan Kaufman
	 	 	Chief Executive Officer 






 




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Exhibit
“A”


 


Shareholders
Agreement


 








    4