Document:

Exhibit

JPMORGAN CHASE BANK, N.A. ELEVENTH AMENDMENT TO CREDIT AGREEMENT

THIS ELEVENTH AMENDMENT TO CREDIT AGREEMENT (this “Amendment”) is dated as of May 15, 2018 and is by and between FUEL TECH INC., a Delaware corporation (the “Borrower”), the Loan Parties party hereto, and JPMORGAN CHASE BANK, N.A., a national banking association (“Lender”).

WHEREAS, Lender and the Loan Parties are parties to a Credit Agreement dated as of June 30, 2009 (together with the ten amendments as described below, the “Credit Agreement”).  The Credit Agreement evidences certain credit facilities pursuant to which the Lender has made certain revolving loans to the Loan Parties on the terms and conditions set forth therein.   The Loan Parties’ obligations under the Credit Agreement were originally evidenced by that certain Promissory Note executed by Borrower in the original principal amount of $25,000,000.00 dated June 30, 2009 (the “Note”);

WHEREAS,  pursuant  to  the  First  Amendment  to  Credit  Agreement  dated October 5, 2009, the parties corrected a scrivener's error which had occurred in Section 6.14 (b) (“Leverage Ratio”) of the Credit Agreement;

WHEREAS, pursuant to the Second Amendment to the Credit Agreement dated
November 4, 2009, the Lender waived a default of the covenant set forth in Section
6.14(a) of the Agreement, amended the Minimum Net Income covenant, amended the
Leverage  Ratio,  and  amended  the  definitions  of  “Permitted  Acquisitions”  and
“Applicable Rate”;

WHEREAS, pursuant to the Third Amendment to the Credit Agreement dated June 30, 2011, the Lender renewed and reduced the revolving credit facility evidenced by the Note to $15,000,000.00 and adjusted the Tangible Net Worth Covenant;

WHEREAS, pursuant to the Fourth Amendment to the Credit Agreement dated June 30, 2013, the Lender extended the maturity date of the revolving credit facility evidenced by the Note to June 30, 2015 and also amended the financial covenants set forth at Sections 6.14(b) (“Leverage Ratio”) and 6.14(c) (“Minimum Tangible Net Worth”) of the Credit Agreement;

WHEREAS, pursuant to the Fifth Amendment to the Credit Agreement dated June 20, 2014,, Lender made further adjustments to Section 6.14(c) of the Credit Agreement (“Minimum Tangible Net Worth”);

WHEREAS, pursuant to the Sixth Amendment to the Credit Agreement dated June 30, 2015, Lender, among other things, renewed the Revolving Credit Facility and extended same until June 30, 2016, changed certain pricing on the Revolving Credit Facility, waived certain financial covenant violations, and restated certain financial covenants;

WHEREAS, pursuant to the Seventh Amendment to the Credit Agreement dated
December 31, 2015, the parties agreed, among other things, that (i) certain covenants

(Minimum  EBITDA  and  Shareholder  Equity)  not  be  tested  for  the  period  ending December 31, 2015, with the Shareholder Equity covenant to be deleted in its entirety, (ii)  a  new  Working  Capital  covenant  be  established  and  tested  beginning  as  of December 31, 2015, and (iii) the Minimum EBITDA covenant be revised and tested beginning as of March 31, 2016;

WHEREAS, pursuant to the Eighth Amendment to the Credit Agreement dated May  9,  2016,  the  parties  agreed,  among  other  things,  that  (i)  the  Revolving Commitment would be reduced to $5,000,000.00 after August 1, 2016, (ii) a Cash Collateral Account satisfactory to the Lender would be in place until Maturity, and (iii) as a result of the creation of the Cash Collateral Account all financial covenants had been deleted;

WHEREAS, pursuant to the Ninth Amendment the Maturity Date was extended to June 28, 2019;

WHEREAS, pursuant to the Tenth Amendment the commitment amounts were modified;

WHEREAS, Fuel Tech Inc. is the guarantor of a loan facility made by Lender’s affiliate  JPMorgan  Chase  Bank  (“China”)  Company  Limited,  Shanghai  Branch  to Beijing Fuel Tech Environmental Technologies Inc (“Borrower’s Subsidiary”).  Lender’s affiliate has agreed to extend the maturity of said loan facility to Borrower’s Subsidiary until June 30, 2019, subject to the terms and conditions set forth in paragraph 3 below (“Subsidiary Loan Facility”);

NOW THEREFORE, for good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the parties agree as follows:

1.      The parties acknowledge the accuracy of the foregoing recitals.   All capitalized terms used herein without specific definitions should be accorded the meanings set forth for such terms in the Credit Agreement.

2.       The Borrower’s obligations for the guaranty of the Subsidiary’s debt will continue through at least June 30, 2019 or whenever the Subsidiary’s debt is actually repaid.

3.       The obligation of the Lender to amend the Agreement of the Subsidiary Loan  Facility  as  herein  above  set  forth  and  extend  the  maturity  of  and  the effectiveness of this Amendment, is subject to satisfaction of the following conditions precedent:

(a)      Lender, Borrower and Loan Parties shall have executed this Amendment; (b)      Borrower shall be in good standing in the States of Illinois and Delaware;
(c)      Borrower shall pay all costs and fees incurred by Lender in connection with the preparation and performance of this Amendment;

(d)      There  shall  be  no  less  than  $6,720,000.00  in  the  Cash  Collateral Account  until  August  31,  2018;  at  which  time  the  Cash  Collateral Account   shall   be   no   less   than   $6,220,000,   provided   that   the Commitment to Borrower has been reduced by $500,000; and

4.       This Amendment shall be binding upon and inure to the benefit of the successors and assigns of the Borrower, Loan Parties and the Lender.

5.       Except as expressly amended hereby, the Credit Agreement shall remain in full force and effect.  The Credit Agreement and its ten prior amendments as well as the Cash Collateral Account Pledge Agreement and all rights and powers created thereby are in all respects ratified and confirmed.

6.       This Amendment has been duly authorized, executed and delivered on behalf of the Borrower and Loan Parties pursuant to all requisite corporate authority, and the Credit Agreement as amended hereby constitutes the legal, valid and binding obligation of the Borrower and Loan Parties, enforceable in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to creditor’s rights.

7.       Borrower hereby certifies, represents and warrants to Lender that all certifications, representations and warranties made by Borrower to Lender in or in connection with the Credit Agreement and the Cash Collateral Account Pledge Agreement were true in all material respects as of the date of the Credit Agreement and  the  Cash  Collateral  Account  Pledge  Agreement  and  are  true  in  all  material respects on and as of the date hereof as if made on and as of the date hereof.

8.       Borrower and the Loan Parties hereby acknowledge and agree that they have no defenses, offsets or counterclaims to the payment of principal, interest, fees or other liabilities owing under the Credit Agreement and the Cash Collateral Pledge Agreement and they hereby waive and relinquish any such defenses, offsets or counterclaims and Borrower and the  Loan Parties hereby release  Lender and its respective officers, directors, agents, affiliates, successors and assigns from any claim, demand or cause of action, known or unknown, contingent or liquidated, which may exist or hereafter be known to exist relating to any matter prior to the date hereof.

9.       Except  as  otherwise  specified  herein,  this  Amendment  embodies  the entire agreement and understanding between Lender and Borrower with respect to the subject matter hereof and supersedes all prior agreements, consents and understandings relating to such subject matter.

10.     This Amendment may be signed in any number of counterparts, each of which shall be deemed to be an original, but all of which together shall constitute one and the same instrument.

11.     This Amendment is governed and controlled by the laws of the state of
Illinois.

[Signature Page to Follow]

IN WITNESS WHEREOF, this Amendment has been duly executed as of the date and year specified at the beginning hereof.

BORROWER:

FUEL TECH, INC.,
a Delaware corporation

By:      Name:      Title:      

LOAN GUARANTOR:

FUEL TECH S.r.l.,
organized under the laws of the Italian Republic

By:      Name:      Title:      

LENDER:

JPMORGAN CHASE BANK, N.A.,
a national association

By:      Name:      Title:Exhibit 4.3

 

NEITHER THESE SECURITIES NOR THE SECURITIES
ISSUABLE UPON EXERCISE OF THESE SECURITIES HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION
OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”) AND APPLICABLE STATE SECURITIES LAWS AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO (I) AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR (II) AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT
TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS OR BLUE SKY LAWS.
THESE SECURITIES AND THE SECURITIES ISSUABLE UPON EXERCISE OF THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN
ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.

 

ETON PHARMACEUTICALS,
INC.

 

WARRANT
TO PURCHASE COMMON STOCK

 

	Warrant No. 1	Original Issue Date:  June 26, 2017

 

Eton Pharmaceuticals, Inc., a Delaware
corporation (the “Company”), hereby certifies that, for value received, National Securities Corporation,
or its permitted registered assigns (the “Holder”), is entitled to purchase from the Company such number
of shares of common stock, $0.001 par value (the “Common Stock”), of the Company (each such share, a
“Warrant Share” and all such shares, the “Warrant Shares”) as determined in
accordance with the terms herewith, at the Exercise Price (as defined below), at any time and from time to time from on or after
the date hereof (the “Trigger Date”) and through and including 5:00 P.M., prevailing Pacific time, on
June 26, 2022 (the “Expiration Date”), and subject to the following terms and conditions:

 

This Warrant (this
“Warrant”) is issued pursuant to that certain Engagement Agreement dated April 28, 2017 between the Company
and the Holder (the “Engagement Agreement”).

 

1.           Definitions.
In addition to the terms defined elsewhere in this Warrant, capitalized terms that are not otherwise defined herein have the meanings
given to such terms in the Engagement Agreement. As used in this Warrant, the term “Series A Preferred Stock”
shall mean the Company’s $0.001 par value Series A Preferred Stock and the term “Conversion Price”
shall have the meaning given to it in Section 8 of the Amended and Restated Certificate of Incorporation (“Certificate
of Incorporation”) of the Company filed with the Delaware Secretary of State on June 15, 2017.

 

2.           Exercise
Price. For purposes of this Warrant, the “Exercise Price” shall be equal to 100% of the Conversion
Price of the Series A Preferred Stock, as determined pursuant to Section 8 of the Certificate of Incorporation. Notwithstanding
the foregoing, until such time as the Series A Preferred Stock is converted pursuant to Section 8 of the Certificate of Incorporation,
the Exercise Price shall be equal to $3.00 (as adjusted from time to time as provided in Section 11 herein).

 

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3.           Number
of Warrant Shares. The aggregate number of Warrant Shares shall be equal to 10% of the aggregate number of shares of Common
Stock issued by the Company upon conversion of 6,576,748 shares (as adjusted for combinations, subdivisions and the like) of the
Series A Preferred Stock pursuant to Section 8 of the Certificate of Incorporation. Notwithstanding the foregoing, until such
time as the Series A Preferred Stock is converted pursuant to Section 8 of the Certificate of Incorporation, the number of Warrant
Shares shall be equal to 657,675 shares of Common Stock (as adjusted from time to time as provided in Section 11 herein).

 

4.           Registration
of Warrants. The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the “Warrant
Register”), in the name of the record Holder (which shall include the initial Holder or, as the case may be, any
registered assignee to which this Warrant is permissibly assigned hereunder) from time to time. The Company may deem and treat
the registered Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution
to the Holder, and for all other purposes, absent actual notice to the contrary.

 

5.           Registration
of Transfers. The Company shall register the transfer of all or any portion of this Warrant in the Warrant Register, upon
(i) surrender of this Warrant, with the Form of Assignment attached as Schedule 2 hereto duly completed and signed, to
the Company’s transfer agent or to the Company at its address specified herein (ii) delivery, at the request of the Company,
of an opinion of counsel reasonably satisfactory to the Company to the effect that the transfer of such portion of this Warrant
may be made pursuant to an available exemption from the registration requirements of the Securities Act of 1933 (“Securities
Act”) and all applicable state securities or blue sky laws and (iii) delivery by the transferee of a written statement
to the Company certifying that the transferee is an “accredited investor” as defined in Rule 501(a) under the Securities
Act and making the representations and certifications as the Company may reasonably request to procure an exemption from section
5 of the Securities Act. Upon any such registration or transfer, a new warrant to purchase Common Stock in substantially the form
of this Warrant (any such new warrant, a “New Warrant”) evidencing the portion of this Warrant so transferred
shall be issued to the transferee, and a New Warrant evidencing the remaining portion of this Warrant not so transferred, if any,
shall be issued to the transferring Holder. The acceptance of the New Warrant by the transferee thereof shall be deemed the acceptance
by such transferee of all of the rights and obligations of a Holder of a Warrant.

 

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6.           Exercise
and Duration of Warrants.

 

(a)          All
or any part of this Warrant shall be exercisable by the registered Holder at any time and from time to time on or after the Trigger
Date and through and including 5:00 P.M. prevailing Pacific time on the Expiration Date. At 5:00 P.M., prevailing Pacific time,
on the Expiration Date, the portion of this Warrant not exercised prior thereto shall be and become void and of no value and this
Warrant shall be terminated and no longer outstanding.

 

(b)          The
Holder may exercise this Warrant by delivering to the Company (i) an exercise notice, in the form attached as Schedule 1 hereto
(the “Exercise Notice”), appropriately completed and duly signed, (ii) payment of the Exercise Price
for the number of Warrant Shares as to which this Warrant is being exercised (which may take the form of a “cashless exercise”
if so indicated in the Exercise Notice and if a “cashless exercise” may occur at such time pursuant to Section 12
below), and the date such items are delivered to the Company (as determined in accordance with the notice provisions hereof) is
an “Exercise Date.” The Holder shall not be required to deliver the original Warrant in order to effect
an exercise hereunder. Execution and delivery of the Exercise Notice shall have the same effect as cancellation of the original
Warrant and issuance of a New Warrant evidencing the right to purchase the remaining number of Warrant Shares.

 

7.           Delivery
of Warrant Shares. Upon exercise of this Warrant, the Company shall promptly issue or cause to be issued and cause to be delivered
to or upon the written order of the Holder and in such name or names as the Holder may designate a certificate for the Warrant
Shares issuable upon such exercise, with an appropriate restrictive legend. The Holder, or any Person permissibly so designated
by the Holder to receive Warrant Shares, shall be deemed to have become the holder of record of such Warrant Shares as of the
Exercise Date.

 

8.           Charges,
Taxes and Expenses. Issuance and delivery of certificates for shares of Common Stock upon exercise of this Warrant shall be
made without charge to the Holder for any issue or transfer tax, transfer agent fee or other incidental tax or expense in respect
of the issuance of such certificates, all of which taxes and expenses shall be paid by the Company; provided, however,
that the Company shall not be required to pay any tax which may be payable in respect of any transfer involved in the registration
of any certificates for Warrant Shares or Warrants in a name other than that of the Holder or an Affiliate thereof. The Holder
shall be responsible for all other tax liability that may arise as a result of holding or transferring this Warrant or receiving
Warrant Shares upon exercise hereof.

 

9.           Replacement
of Warrant. If this Warrant is mutilated, lost, stolen or destroyed, the Company shall issue or cause to be issued in exchange
and substitution for and upon cancellation hereof, or in lieu of and substitution for this Warrant, a New Warrant, but only upon
receipt of evidence reasonably satisfactory to the Company of such loss, theft or destruction (in such case) and, in each case,
a customary and reasonable indemnity (which shall not include a surety bond), if requested. Applicants for a New Warrant under
such circumstances shall also comply with such other reasonable regulations and procedures and pay such other reasonable third-party
costs as the Company may prescribe. If a New Warrant is requested as a result of a mutilation of this Warrant, then the Holder
shall deliver such mutilated Warrant to the Company as a condition precedent to the Company’s obligation to issue the New
Warrant.

 

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10.         Reservation
of Warrant Shares. The Company covenants that it will at all times reserve and keep available out of the aggregate of its
authorized but unissued and otherwise unreserved Common Stock, solely for the purpose of enabling it to issue Warrant Shares upon
exercise of this Warrant as herein provided, the number of Warrant Shares which are then issuable and deliverable upon the exercise
of this entire Warrant, free from preemptive rights or any other contingent purchase rights of persons other than the Holder (taking
into account the adjustments and restrictions of Section 11). The Company covenants that all Warrant Shares so issuable
and deliverable shall, upon issuance and the payment of the applicable Exercise Price in accordance with the terms hereof, be
duly and validly authorized, issued and fully paid and nonassessable. The Company will take all such action as may be necessary
to assure that such shares of Common Stock may be issued as provided herein without violation of any applicable law or regulation,
or of any requirements of any securities exchange or automated quotation system upon which the Common Shares may be listed.

 

11.         Certain
Adjustments. The Exercise Price and number of Warrant Shares issuable upon exercise of this Warrant are subject to adjustment
from time to time as set forth in this Section 11.

 

(a)          Stock
Dividends and Splits. If the Company, at any time while this Warrant is outstanding, (i) pays a stock dividend on its Common
Stock or otherwise makes a distribution on any class of capital stock that is payable in shares of Common Stock, (ii) subdivides
its outstanding shares of Common Stock into a larger number of shares, or (iii) combines its outstanding shares of Common Stock
into a smaller number of shares, then in each such case the Exercise Price shall be multiplied by a fraction, the numerator of
which shall be the number of shares of Common Stock outstanding immediately before such event and the denominator of which shall
be the number of shares of Common Stock outstanding immediately after such event. Any adjustment made pursuant to clause (i) of
this paragraph shall become effective immediately after the record date for the determination of stockholders entitled to receive
such dividend or distribution, and any adjustment pursuant to clause (ii) or (iii) of this paragraph shall become effective immediately
after the effective date of such subdivision or combination.

 

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(b)          Fundamental
Transactions. If, at any time while this Warrant is outstanding (i) the Company effects any merger or consolidation of
the Company with or into another Person, in which the Company is not the survivor, (ii) the Company effects any sale of all or
substantially all of its assets or a majority of its Common Stock is acquired by a third party, in each case, in one or a series
of related transactions, (iii) any tender offer or exchange offer (whether by the Company or another Person) is completed pursuant
to which all or substantially all of the holders of Common Stock are permitted to tender or exchange their shares for other securities,
cash or property, or (iv) the Company effects any reclassification of the Common Stock or any compulsory share exchange pursuant
to which the Common Stock is effectively converted into or exchanged for other securities, cash or property (other than as a result
of a subdivision or combination of shares of Common Stock covered by Section 11(a) above) (in any such case, a “Fundamental
Transaction”), then the Holder shall have the right thereafter to receive, upon exercise of this Warrant, the same
amount and kind of securities, cash or property as it would have been entitled to receive upon the occurrence of such Fundamental
Transaction if it had been, immediately prior to such Fundamental Transaction, the holder of the number of Warrant Shares then
issuable upon exercise in full of this Warrant without regard to any limitations on exercise contained herein (the “Alternate
Consideration”). The Company shall not effect any such Fundamental Transaction unless prior to or simultaneously
with the consummation thereof, any successor to the Company, surviving entity or the corporation purchasing or otherwise acquiring
such assets or other appropriate corporation or entity shall assume the obligation to deliver to the Holder, such Alternate Consideration
as, in accordance with the foregoing provisions, the Holder may be entitled to purchase and/or receive (as the case may be), and
the other obligations under this Warrant. The provisions of this paragraph (c) shall similarly apply to subsequent transactions
analogous to a Fundamental Transaction.

 

(c)          Number
of Warrant Shares. Simultaneously with any adjustment to the Exercise Price pursuant to paragraph (a) of this Section, the
number of Warrant Shares that may be purchased upon exercise of this Warrant shall be increased or decreased proportionately, so
that after such adjustment the aggregate Exercise Price payable hereunder for the increased or decreased number of Warrant Shares
shall be the same as the aggregate Exercise Price in effect immediately prior to such adjustment.

 

(d)          Calculations.
All calculations under this Section 11 shall be made to the nearest cent or the nearest 1/100th of a share, as
applicable. The number of shares of Common Stock outstanding at any given time shall not include shares owned or held by or for
the account of the Company, and the sale or issuance of any such shares shall be considered an issue or sale of Common Stock.

 

(e)          Notice
of Adjustments. Upon the occurrence of each adjustment pursuant to this Section 11, the Company at its expense
will, at the written request of the Holder, promptly compute such adjustment, in good faith, in accordance with the terms of this
Warrant and prepare a certificate setting forth such adjustment, including a statement of the adjusted Exercise Price and adjusted
number or type of Warrant Shares or other securities issuable upon exercise of this Warrant (as applicable), describing the transactions
giving rise to such adjustments and showing in detail the facts upon which such adjustment is based. Upon written request, the
Company will promptly deliver a copy of each such certificate to the Holder and to the Company’s transfer agent.

 

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(f)          Notice
of Corporate Events. If, while this Warrant is outstanding, the Company (i) declares a dividend or any other distribution
of cash, securities or other property in respect of its Common Stock, including, without limitation, any granting of rights or
warrants to subscribe for or purchase any capital stock of the Company, (ii) authorizes or approves, enters into any agreement
contemplating or solicits stockholder approval for any Fundamental Transaction or (iii) authorizes the voluntary dissolution, liquidation
or winding up of the affairs of the Company, then, except if such notice and the contents thereof shall be deemed to constitute
material non-public information, the Company shall deliver to the Holder a notice describing the material terms and conditions
of such transaction at least ten (10) Trading Days prior to the applicable record or effective date on which a Person would need
to hold Common Stock in order to participate in or vote with respect to such transaction, and the Company will take all steps reasonably
necessary in order to insure that the Holder is given the practical opportunity to exercise this Warrant prior to such time so
as to participate in or vote with respect to such transaction; provided, however, that the failure to deliver such notice
or any defect therein shall not affect the validity of the corporate action required to be described in such notice.

 

12.         Payment
of Exercise Price. The Holder shall pay the Exercise Price in immediately available funds; provided, however, the Holder
may, in its sole discretion, commencing on the date that is 18 months from the date of this Warrant, satisfy its obligation to
pay the Exercise Price through a “cashless exercise”, in which event the Company shall issue to the Holder the number
of Warrant Shares determined as follows:

 

X = Y [(A-B)/A]

 

where:

 

X = the number of Warrant Shares
to be issued to the Holder.

 

Y = the total number of Warrant
Shares with respect to which this Warrant is being exercised.

 

A = the average of the Closing
Sale Prices of the shares of Common Stock (as reported by Bloomberg Financial Markets) for the five Trading Days ending on the
date immediately preceding the Exercise Date.

 

B = the Exercise Price then in
effect for the applicable Warrant Shares at the time of such exercise.

 

For purposes of this Warrant, “Closing
Sale Price” means, for any security as of any date, the last trade price for such security on the principal securities
exchange or trading market for such security, as reported by Bloomberg Financial Markets, or, if such exchange or trading market
begins to operate on an extended hours basis and does not designate the last trade price, then the last trade price of such security
prior to 4:00:00 p.m., New York Time, as reported by Bloomberg Financial Markets, or if the foregoing do not apply, the last trade
price of such security in the over-the-counter market on the electronic bulletin board for such security as reported by Bloomberg
Financial Markets, or, if no last trade price is reported for such security by Bloomberg Financial Markets, the average of the
bid prices, or the ask prices, respectively, of any market makers for such security as reported in the “pink sheets”
by Pink Sheets LLC. If the Closing Sale Price cannot be calculated for a security on a particular date on any of the foregoing
bases, the Closing Sale Price of such security on such date shall be the fair market value as mutually determined by the Company
and the Holder. If the Company and the Holder are unable to agree upon the fair market value of such security, then the Company
shall, within two business days submit via facsimile (a) the disputed determination of the Warrant Exercise Price to an independent,
reputable investment bank selected by the Company and approved by the Holder or (b) the disputed arithmetic calculation of the
Warrant Shares to the Company’s independent, outside accountant. The Company shall cause at its expense the investment bank
or the accountant, as the case may be, to perform the determinations or calculations and notify the Company and the Holder of the
results no later than ten business days from the time it receives the disputed determinations or calculations. Such investment
bank’s or accountant’s determination or calculation, as the case may be, shall be binding upon all parties absent demonstrable
error. All such determinations to be appropriately adjusted for any stock dividend, stock split, stock combination or other similar
transaction during the applicable calculation period.

 

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For purposes of Rule 144 promulgated under
the Securities Act, it is intended, understood and acknowledged that the Warrant Shares issued in a cashless exercise transaction
shall be deemed to have been acquired by the Holder, and the holding period for the Warrant Shares shall be deemed to have commenced,
on the date this Warrant was originally issued pursuant to the Consulting Agreement (provided that the Commission continues to
take the position that such treatment is proper at the time of such exercise).

 

13.         Limitation
on Exercises. The Company shall not effect the exercise of this Warrant, and the Holder shall not have the right to exercise
this Warrant, to the extent that after giving effect to such exercise, the Holder (together with such Holder’s affiliates)
would beneficially own in excess of 4.99% (“Maximum Percentage”) of the shares of Common Stock outstanding
immediately after giving effect to such exercise. For purposes of the foregoing sentence, the aggregate number of shares of Common
Stock beneficially owned by such Holder and its affiliates shall include the number of shares of Common Stock issuable upon exercise
of this Warrant with respect to which the determination of such sentence is being made, but shall exclude shares of Common Stock
which would be issuable upon (A) exercise of the remaining, unexercised portion of this Warrant beneficially owned by such Holder
and its affiliates and (B) exercise or conversion of the unexercised or unconverted portion of any other securities of the Company
beneficially owned by such Person and its affiliates (including, without limitation, any convertible notes or convertible preferred
stock or warrants) subject to a limitation on conversion or exercise analogous to the limitation contained herein. Except as set
forth in the preceding sentence, for purposes of this paragraph, beneficial ownership shall be calculated in accordance with Section
13(d) of the Securities Exchange Act of 1934, as amended. To the extent that the limitation contained in this Section 13
applies, the determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together
with any affiliate) and of which portion of this Warrant is exercisable shall be in the sole discretion of the Holder, and the
submission of a Notice of Exercise shall be deemed to be the Holder’s determination of whether this Warrant is exercisable
(in relation to other securities owned by the Holder together with any affiliate) and of which portion of this Warrant is exercisable,
in each case subject to such aggregate percentage limitation, and the Company shall have no obligation to verify or confirm the
accuracy of the determination. For purposes of this Warrant, in determining the number of outstanding shares of Common Stock,
the Holder may rely on the number of outstanding shares of Common Stock as reflected in (1) the Company’s most recent Form
10-K, Form 10-Q, Current Report on Form 8-K or other public filing with the Securities and Exchange Commission, as the case may
be, (2) a more recent public announcement by the Company or (3) any other notice by the Company setting forth the number of shares
of Common Stock outstanding. For any reason at any time, upon the written or oral request of the Holder, the Company shall within
one (1) business day confirm orally and in writing to the Holder the number of shares of Common Stock then outstanding. In any
case, the number of outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of
securities of the Company, including this Warrant, by the Holder and its affiliates since the date as of which such number of
outstanding shares of Common Stock was reported. By written notice to the Company, any Holder may decrease the Maximum Percentage
to any other percentage specified in such notice; provided that such decrease will apply only to the Holder sending such notice
and not to any other holder of Warrants. In addition, by written notice to the Company, any Holder may remove the limitations
on exercises provided in this Section 13 entirely; provided that (i) any such removal will not be effective until the 61st
day after such notice is delivered to the Company, and (ii) any such removal will apply only to the Holder sending such notice
and not to any other holder of Warrants. The provisions of this paragraph shall be construed and implemented in a manner otherwise
than in strict conformity with the terms of this Section 13 to correct this paragraph (or any portion hereof) which may
be defective or inconsistent with the intended beneficial ownership limitation herein contained or to make changes or supplements
necessary or desirable to properly give effect to such limitation.

 

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14.         No
Fractional Shares. No fractional Warrant Shares will be issued in connection with any exercise of this Warrant. In lieu of
any fractional shares which would otherwise be issuable, the number of Warrant Shares to be issued shall be rounded up to the
next whole number.

 

15.         Notices.
Any and all notices or other communications or deliveries hereunder (including, without limitation, any Exercise Notice) shall
be in writing and shall be deemed given and effective on the earliest of (i) the date of transmission, if such notice or communication
is delivered via email at the email address specified in the Engagement Agreement prior to 5:00 p.m. (prevailing Pacific time)
on a Trading Day, (ii) the next Trading Day after the date of transmission, if such notice or communication is delivered
via email at the email address specified in the Engagement Agreement on a day that is not a Trading Day or later than 5:00 p.m.
(prevailing Pacific time) on any Trading Day, (iii) the Trading Day following the date of mailing, if sent by nationally recognized
overnight courier service specifying next business day delivery, or (iv) upon actual receipt by the party to whom such notice
is required to be given, if by hand delivery. The address and facsimile number of a party for such notices or communications shall
be as set forth in the Engagement Agreement unless changed by such party by two Trading Days’ prior notice to the other
party in accordance with this Section 15.

 

    	8

     

    

 

16.         Warrant
Agent. The Company shall serve as warrant agent under this Warrant. Upon thirty (30) days’ notice to the Holder, the
Company may appoint a new warrant agent. Any corporation into which the Company or any new warrant agent may be merged or any
corporation resulting from any consolidation to which the Company or any new warrant agent shall be a party or any corporation
to which the Company or any new warrant agent transfers substantially all of its corporate trust or shareholders’ services
business shall be a successor warrant agent under this Warrant without any further act. Any such successor warrant agent shall
promptly cause notice of its succession as warrant agent to be mailed (by first class mail, postage prepaid) to the Holder at
the Holder’s last address as shown on the Warrant Register.

 

17.         Registration
Rights. The Company agrees that the Holder and its assigns will have registration rights covering the resale of the Warrant
Shares, including “piggyback” registration rights on the registrations of the Company or demand registrations
(voting with the other registrable securities to effect any such demand), no less favorable than those granted to any other person
by the Company prior or subsequent to the date of this Warrant. At such time, and from time to time, as the Company enters into
an agreement subsequent to the date of this Warrant pursuant to which the Company grants any third party rights with respect to
the Company’s registration of Company securities under the Securities Act held by such party, the Company shall offer to
enter into a formal written registration rights agreement with the Holder and its assigns on substantially the same terms and
such other terms as are customary and usual for agreements of such nature. In addition to, and without restricting or limiting
the scope of this subparagraph (a), the Company further agrees that:

 

(a)          Right
to Piggyback. Whenever the Company proposes to register any of its securities under the Securities Act, the Company will give
prompt written notice to the Holder of its intention to effect such registration and will include in such registration all Warrant
Shares with respect to which the Company has received a written request from the Holder for inclusion therein within 15 days after
the receipt of the Company’s notice. The Company will pay, or cause to be paid, the registration expenses of the Holder in
all piggyback registrations.

 

(b)          Underwritten
Offering. If a piggyback registration is an underwritten primary or secondary registration on behalf of the Company and/or
other holders of the Common Stock, and the managing underwriters advise the Company in writing that in their opinion the number
of shares requested to be included in such registration (including the Warrant Shares and any other shares of Common Stock held
by holders with registration rights) exceeds the number which can be sold in such offering without materially and adversely affecting
the marketability of the offering, the Company will promptly furnish the Holder with a copy of the underwriter’s opinion
and may, by written notice to the Holder, include in such registration (i) first, the securities the Company proposes to sell,
(ii) second, the Common Stock requested to be included in such registration pro rata among all holders with registration rights
on the basis of the number of shares owned by each such holder, and (iii) third, exclude all the Common Stock requested to be included
in such registration statement of all holders with registration rights.

 

    	9

     

    

 

(c)          Underwriting
Agreement. In any registration in which the Warrant Shares is to be included, the Holder shall be a party to the underwriting
agreement entered into by the Company in connection therewith, and the representations and warranties by, and the other agreements
on the part of, the Company and for the benefit of the underwriters shall also be made to and for the benefit of the Holder.

 

(d)          Documents,
etc. The Company shall provide to the Holder any and all documents, statements, opinions and forms as the Holder reasonably
deems necessary for the Holder to participate in any piggyback registrations and to facilitate the disposition of the Warrant Shares
covered by such registration pursuant to the terms and conditions of this Agreement and the applicable securities laws.

 

(e)          Indemnification.
In the event of any piggyback registration of any Warrant Shares under the Securities Act, and in connection with any registration
statement or any other disclosure document pursuant to which securities of the Company are sold, the Company will, and hereby does,
jointly and severally, indemnify and hold harmless the Holder, its directors, officers, fiduciaries, and agents (each, a “Covered
Person”) against any losses, claims, damages or liabilities, joint or several, to which such Covered Person may be
or become subject under the Securities Act, any other securities or other laws of any jurisdiction, common law or otherwise, insofar
as such losses, claims, damages or liabilities (or actions or proceedings in respect thereof) arise out of or are based upon (1)
any untrue statement or alleged untrue statement of any material fact contained or incorporated by reference in any registration
statement under the Securities Act, any preliminary prospectus or final prospectus included therein, or any amendment or supplement
thereto, or any document incorporated by reference therein, or any other such disclosure document, or (2) any omission or alleged
omission to state therein a material fact required to be stated therein or necessary to make the statement therein not misleading,
and will reimburse such Covered Person for any legal or any other expenses incurred by in connection with investigating or defending
any such loss, claim, damage, liability, action or proceeding; provided, however, the Company shall not be liable to any
Covered Person in any such case to the extent that any such loss, claim, damage, liability, action or proceeding is determined,
by a final, non-appealable judgment by a court or arbitral tribunal of competent jurisdiction, to have arisen out of or is based
upon an untrue statement or alleged untrue statement or omission or alleged omission made in such registration statement, any such
preliminary prospectus, final prospectus, amendment or supplement, any document incorporated by reference or other such disclosure
document in reliance upon and in conformity with written information furnished to the Company through an instrument duly executed
by such Covered Person specifically stating this it is for use in the preparation thereof.

 

(f)          All
fees and expenses incurred by the Company in connection with the performance of its obligation to register the Warrant Shares pursuant
to Section 17 shall be borne by the Company; provided that any fees and expenses of the holder or holders thereof or of
its or their counsel, and transfer taxes applicable to the sale of such Warrant Shares, shall be borne by such holder or holders.

 

    	10

     

    

 

18.         Miscellaneous.

 

(a)          The
Holder, solely in such Person’s capacity as a holder of this Warrant, shall not be entitled to vote or receive dividends
or be deemed the holder of share capital of the Company for any purpose, nor shall anything contained in this Warrant be construed
to confer upon the Holder, solely in such Person’s capacity as the Holder of this Warrant, any of the rights of a stockholder
of the Company or any right to vote, give or withhold consent to any corporate action (whether any reorganization, issue of stock,
reclassification of stock, consolidation, merger, amalgamation, conveyance or otherwise), receive notice of meetings, receive dividends
or subscription rights, or otherwise, prior to the issuance to the Holder of the Warrant Shares which such Person is then entitled
to receive upon the due exercise of this Warrant. In addition, nothing contained in this Warrant shall be construed as imposing
any liabilities on the Holder to purchase any securities (upon exercise of this Warrant or otherwise) or as a stockholder of the
Company, whether such liabilities are asserted by the Company or by creditors of the Company. Notwithstanding this Section 16(a),
the Company shall provide the Holder with copies of the same notices and other information given to the shareholders of the Company,
contemporaneously with the giving thereof to the shareholders.

 

(b)          Subject
to the restrictions on transfer set forth on the first page hereof, and compliance with applicable securities laws, this Warrant
may be assigned by the Holder. This Warrant may not be assigned by the Company except to a successor in the event of a Fundamental
Transaction. This Warrant shall be binding on and inure to the benefit of the parties hereto and their respective successors and
assigns. Subject to the preceding sentence, nothing in this Warrant shall be construed to give to any Person other than the Company
and the Holder any legal or equitable right, remedy or cause of action under this Warrant. This Warrant may be amended only in
writing signed by the Company and the Holder, or their successors and assigns.

 

(c)          GOVERNING
LAW; VENUE; WAIVER OF JURY TRIAL. ALL QUESTIONS CONCERNING THE CONSTRUCTION, VALIDITY, ENFORCEMENT AND INTERPRETATION OF THIS WARRANT
SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE PRINCIPLES
OF CONFLICTS OF LAW THEREOF. EACH PARTY HEREBY IRREVOCABLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF THE STATE AND FEDERAL COURTS
SITTING IN THE CITY OF NEW YORK, BOROUGH OF MANHATTAN, FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION HEREWITH
OR WITH ANY TRANSACTION CONTEMPLATED HEREBY OR DISCUSSED HEREIN (INCLUDING WITH RESPECT TO THE ENFORCEMENT OF ANY OF THE TRANSACTION
DOCUMENTS), AND HEREBY IRREVOCABLY WAIVES, AND AGREES NOT TO ASSERT IN ANY SUIT, ACTION OR PROCEEDING, ANY CLAIM THAT IT IS NOT
PERSONALLY SUBJECT TO THE JURISDICTION OF ANY SUCH COURT, THAT SUCH SUIT, ACTION OR PROCEEDING IS IMPROPER. EACH PARTY HEREBY IRREVOCABLY
WAIVES PERSONAL SERVICE OF PROCESS AND CONSENTS TO PROCESS BEING SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING BY MAILING A COPY
THEREOF VIA REGISTERED OR CERTIFIED MAIL OR OVERNIGHT DELIVERY (WITH EVIDENCE OF DELIVERY) 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 CONTAINED HEREIN SHALL BE DEEMED TO LIMIT IN ANY WAY ANY RIGHT TO SERVE PROCESS IN ANY MANNER PERMITTED
BY LAW. THE COMPANY HEREBY WAIVES ALL RIGHTS TO A TRIAL BY JURY. 

 

    	11

     

    

 

(d)          The
headings herein are for convenience only, do not constitute a part of this Warrant and shall not be deemed to limit or affect any
of the provisions hereof.

 

(e)          In
case any one or more of the provisions of this Warrant shall be invalid or unenforceable in any respect, the validity and enforceability
of the remaining terms and provisions of this Warrant shall not in any way be affected or impaired thereby, and the parties will
attempt in good faith to agree upon a valid and enforceable provision which shall be a commercially reasonable substitute therefor,
and upon so agreeing, shall incorporate such substitute provision in this Warrant.

 

(f)          Except
as otherwise set forth herein, prior to exercise of this Warrant, the Holder hereof shall not, by reason of by being a Holder,
be entitled to any rights of a stockholder with respect to the Warrant Shares.

 

    	12

     

    

 

IN WITNESS WHEREOF,
the Company has caused this Warrant to be duly executed by its authorized officer as of the date first indicated above.

 

	 	ETON PHARMACEUTICALS, INC.

 

	 	By:	/s/ Mark L. Baum
	 	Name:	Mark L. Baum
	 	Title:	Executive Director

 

    	13

     

    

 

SCHEDULE 1

 

FORM OF EXERCISE NOTICE

 

(To be executed by the Holder to exercise
the right to purchase shares

of Common Stock under the foregoing Warrant)

 

Ladies and Gentlemen:

 

(1)         The
undersigned is the Holder of Warrant No. __________ (the “Warrant”) issued by Eton Pharmaceuticals, Inc. (the
“Company”). Capitalized terms used herein and not otherwise defined herein have the respective meanings set
forth in the Warrant.

 

(2)         The
undersigned hereby exercises its right to purchase __________ Warrant Shares pursuant to the Warrant.

 

(3)         The
Holder intends that payment of the Exercise Price shall be made as (check one):

 

 ̈        Cash
Exercise

 

 ̈        “Cashless
Exercise” under Section 12

 

(4)         If
the Holder has elected a Cash Exercise, the Holder shall pay the sum of $_______ in immediately available funds to the Company
in accordance with the terms of the Warrant.

 

(5)         Pursuant
to this Exercise Notice, the Company shall deliver to the Holder _____________ Warrant Shares in accordance with the terms of the
Warrant.

 

Dated:_______________, _____

 

[Company]

 

	 	 
	By:

 

Signature must conform in all respects
to name of Holder as specified on the face of the Warrant)

 

    	14

     

    

 

SCHEDULE 2

 

FORM OF ASSIGNMENT

 

[To be completed and signed only upon transfer
of Warrant]

 

FOR VALUE RECEIVED, the undersigned hereby
sells, assigns and transfers unto ______________ (the “Transferee” the right represented by the
within Warrant to purchase ______________ shares of Common Stock of Eton Pharmaceuticals, Inc. (the “Company”)
to which the within Warrant relates and appoints ______________ attorney to transfer said right on the books of the Company with
full power of substitution in the premises. In connection therewith, the undersigned represents, warrants, covenants and agrees
to and with the Company that:

 

		(a)	the offer and sale of the Warrant contemplated hereby
is being made in compliance with Section 4(a)(1) of the United States Securities Act of 1933, as amended (the “Securities
Act”) or another valid exemption from the registration requirements of Section 5 of the Securities Act and in compliance
with all applicable securities laws of the states of the United States;

 

		(b)	the undersigned has not offered to sell the Warrant by
any form of general solicitation or general advertising, including, but not limited to, any advertisement, article, notice or
other communication published in any newspaper, magazine or similar media or broadcast over television or radio, and any seminar
or meeting whose attendees have been invited by any general solicitation or general advertising;

 

		(c)	the undersigned has read the Transferee’s investment
letter included herewith, and to its actual knowledge, the statements made therein are true and correct; and

 

		(d)	the undersigned understands that the Company may condition
the transfer of the Warrant contemplated hereby upon the delivery to the Company by the undersigned or the Transferee, as the
case may be, of a written opinion of counsel (which opinion shall be in form, substance and scope customary for opinions of counsel
in comparable transactions) to the effect that such transfer may be made without registration under the Securities Act and under
applicable securities laws of the states of the United States.

 

	Dated:_______________, _____	 	 
	 	 	 
	[Company]	 	Address of Transferee
	 	 	 
	 	 	 
	By:	 	 
	 	 	 
	(Signature must conform in all respects to name of Holder as specified on the face of the Warrant)	 	 
	 	 	 
	In the presence of:	 	 

 

    	15

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