Document:

Securities Purchase Agreement

 Exhibit 10.1 
 SECURITIES PURCHASE AGREEMENT 
 This SECURITIES PURCHASE AGREEMENT
(this “Agreement”), dated as of March 11, 2011, is made by and among BioDelivery Sciences International, Inc., a Delaware corporation (the “Company”), and the Purchasers listed on
Exhibit A hereto, together with their permitted transferees (each, a “Purchaser” and collectively, the “Purchasers”). 
 RECITALS: 
 A. The Company and the Purchasers are executing and
delivering this Agreement in reliance upon the exemption from securities registration afforded by Section 4(2) of the Securities Act, including Rule 506 of Regulation D promulgated thereunder. 

B. The Purchasers desire to purchase and the Company desires to sell, upon the terms and conditions stated in this Agreement,
4,807,693 shares of Common Stock. 
 C. The capitalized terms used herein and not otherwise defined have the meanings
given them in Article 7. 
 AGREEMENT 
 In consideration of the premises and the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and the
Purchasers (severally and not jointly) hereby agree as follows: 
 ARTICLE 1 

PURCHASE AND SALE OF SHARES 
 1.1 Purchase and Sale of Shares. At the Closing, the Company will issue and sell to each Purchaser, and each Purchaser will, severally and not jointly, purchase from the Company the number of
shares of Common Stock (the “Shares”) set forth opposite such Purchaser’s name on Exhibit A hereto. The purchase price for each Share shall be $3.12 (the “Purchase Price”). 

1.2 Payment. At the Closing, each Purchaser will pay the aggregate Purchase Price set forth opposite its name on
Exhibit A hereto by wire transfer of immediately available funds in accordance with wire instructions provided by the Company to the Purchasers prior to the Closing. At the Closing, the Company will instruct its transfer agent to
credit each Purchaser the number of Shares set forth on Exhibit A (and, upon request, will deliver stock certificates to the Purchasers representing the Shares) against delivery of the aggregate Purchase Price on the Closing Date. 

1.3 Closing Date. The closing of the transaction contemplated by this Agreement will take place on the date
first written above (the “Closing Date”) and the closing (the “Closing”) will be held at the offices of Ellenoff Grossman & Schole LLP, 150 East 42nd 

 
Street, 11th Floor, New York, NY 10017 or at such other time and place (including by electronic exchange of facsimile signatures) as shall be agreed upon by the Company and the Purchasers hereunder of a majority in
interest of the Shares. 
 ARTICLE 2 
 REPRESENTATIONS AND WARRANTIES OF THE COMPANY 
 Except as specifically
contemplated by this Agreement or as set forth in the SEC Documents, the Company hereby represents and warrants to the Purchasers that: 
 2.1 Organization and Qualification. The Company is duly incorporated, validly existing and in good standing under the laws of the State of Delaware, with full corporate power and authority to
conduct its business as currently conducted as disclosed in the SEC Documents. The Company is duly qualified to do business and is in good standing in every jurisdiction in which the nature of the business conducted by it or property owned by it
makes such qualification necessary, except where the failure to be so qualified or in good standing, as the case may be, would not reasonably be expected to have a Material Adverse Effect. 

2.2 Authorization; Enforcement. The Company has all requisite corporate power and authority to enter into and to perform its
obligations under this Agreement, to consummate the transactions contemplated hereby and to issue the Shares in accordance with the terms hereof. The execution, delivery and performance of this Agreement by the Company and the consummation by it of
the transactions contemplated hereby (including the issuance of the Shares) have been duly authorized by the Company’s Board of Directors and no further consent or authorization of the Company, its Board of Directors, or its stockholders is
required. This Agreement has been duly executed by the Company and constitutes a legal, valid and binding obligation of the Company enforceable against the Company in accordance with its terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, or moratorium or similar laws affecting creditors’ and contracting parties’ rights generally and except as enforceability may be subject to general principles of equity and except as rights to
indemnity and contribution may be limited by state or federal securities laws or public policy underlying such laws. 
 2.3
Capitalization. The authorized capital stock of the Company, as of the date hereof consists of 45,000,000 shares of Common Stock, of which 24,046,878 shares are issued and outstanding and 5,000,000 shares of blank check preferred stock, $0.001
par value per share, none of which have been designated. 15,491 shares of Common Stock are held in treasury as of the date hereof. All of the issued and outstanding shares of Common Stock have been duly authorized, validly issued, fully paid,
and nonassessable. Options to purchase an aggregate of 4,576,465 shares of Common Stock are outstanding as of the date hereof and warrants to purchase an aggregate of 5,273,921 shares of Common Stock are outstanding as of the date hereof. Except as
disclosed in or contemplated by the SEC Documents, the Company does not have outstanding any options to purchase, or any preemptive rights or other rights to subscribe for or to purchase, any securities or obligations convertible into, or any
contracts or commitments to issue or sell, shares of its capital stock or any such options, rights, convertible securities or obligations other than options granted under the Company’s 

 
Amended and Restated 2001 Stock Incentive Plan. The Company’s Certificate of Incorporation (as amended, the “Certificate of Incorporation”), as in effect on the date
hereof, and the Company’s Amended and Restated Bylaws (the “Bylaws”) as in effect on the date hereof, are each filed as exhibits to the SEC Documents. 

2.4 Issuance of Shares. The Shares are duly authorized and, upon issuance in accordance with the terms of this Agreement, will be
validly issued, fully paid and non-assessable and will not be subject to preemptive rights or other similar rights of stockholders of the Company (except for: (i) the right of first refusal of CDC IV, LLC and (ii) the right of
participation of the investors in the Company’s April 20, 2010 financing, in each case as described in the SEC Documents (collectively, the “Third Party Rights”), which Third Party Rights have been complied with or
validly waived or expired with respect to the Offering as of the Closing). 
 2.5 No Conflicts; Government Consents and
Permits. 
 (a) The execution, delivery and performance of this Agreement by the Company and the consummation by the Company
of the transactions contemplated hereby (including the issuance of the Shares) will not (i) conflict with or result in a violation of any provision of its Certificate of Incorporation or Bylaws or require the approval of the Company’s
stockholders, (ii) 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, or (iii) result in a violation of any law,
rule, regulation, order, judgment or decree (including United States federal and state securities laws and regulations and regulations of any self-regulatory organizations to which the Company or its securities are subject) applicable to the
Company, except in the case of clauses (ii) and (iii) only, for such conflicts, breaches, defaults, and violations as would not reasonably be expected to have a Material Adverse Effect. 

(b) The Company is not required to obtain any consent, authorization or order of, or make any filing or registration with, any court or
governmental agency or any regulatory or self regulatory agency in order for it to execute, deliver or perform any of its obligations under this Agreement in accordance with the terms hereof, or to issue and sell the Shares in accordance with the
terms hereof, other than such as have been made or obtained, and except for the registration of the Shares under the Securities Act pursuant to Section 6 hereof, any filings required to be made under federal or state securities laws, and any
required filings or notifications regarding the issuance or listing of additional shares with Nasdaq. 
 (c) The Company has all
franchises, permits, licenses, and any similar authority necessary for the conduct of its business as now being conducted by it and as currently proposed to be conducted as disclosed in the SEC Documents, except for such franchise, permit, license
or similar authority, the lack of which would not reasonably be expected to have a Material Adverse Effect. The Company has not received any actual notice of any proceeding relating to revocation or modification of any such franchise, permit,
license, or similar authority except where such revocation or modification would not reasonably be expected to have a Material Adverse Effect. 

 2.6 SEC Documents, Financial Statements. The Company has timely filed all reports,
schedules, forms, statements and other documents required to be filed by it with the SEC since January 1, 2010, pursuant to the reporting requirements of the Exchange Act (all of the foregoing filed prior to the date hereof and all exhibits
included therein and financial statements and schedules thereto and documents (other than exhibits) incorporated by reference therein, and together with the Company’s Annual Report on Form 10-K for the fiscal year ending December 31, 2010,
both in the draft form provided to certain of the Purchasers under cover of a confidentiality agreement, and as ultimately filed with the SEC (the “Form 10-K”), being collectively hereinafter referred to herein as the
“SEC Documents”). The Company is eligible to register its Common Stock for resale using Form S-3 promulgated under the Securities Act. Each Purchaser has had access to true and complete copies of the SEC Documents via the
SEC’s EDGAR system. As of their respective dates, the SEC Documents complied in all material respects with the requirements of the Exchange Act or the Securities Act, as the case may be, and the rules and regulations of the SEC promulgated
thereunder applicable to the SEC Documents, and none of the SEC Documents, at the time they were filed with the SEC, contained any untrue statement of a material fact or omitted 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 and the related notes complied as to form in all material respects with applicable
accounting requirements and the published rules and regulations of the SEC with respect thereto. The Financial Statements and the related notes have been prepared in accordance with accounting principles generally accepted in the United States,
consistently applied, during the periods involved (except (i) as may be otherwise indicated in the Financial Statements or the notes thereto, or (ii) in the case of unaudited interim statements, to the extent they may not include
footnotes, may be condensed or summary statements or may conform to the SEC’s rules and instructions for Reports on Form 10-Q) and fairly present in all material respects the consolidated financial position of the Company as of the dates
thereof and the consolidated results of its operations and cash flows for the periods then ended (subject, in the case of unaudited statements, to normal and recurring year-end audit adjustments). All material agreements that were required to be
filed as exhibits to the SEC Documents under Item 601 of Regulation S-K (collectively, the “Material Agreements”) to which the Company or any Subsidiary of the Company is a party, or the property or assets of the Company
or any Subsidiary of the Company are subject, have been filed as exhibits to the SEC Documents. All Material Agreements are valid and enforceable against the Company in accordance with their respective terms, except (i) as enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, or moratorium or similar laws affecting creditors’ and contracting parties’ rights generally, and (ii) as enforceability may be subject to general principles of equity and
except as rights to indemnity and contribution may be limited by state or federal securities laws or public policy underlying such laws. The Company is not in breach of or default under any of the Material Agreements, and to the Company’s
knowledge, no other party to a Material Agreement is in breach of or default under such Material Agreement, except, in each case, for such breaches or defaults as would not reasonably be expected to have a Material Adverse Effect. The Company has
not received a notice of termination nor is the Company otherwise aware of any threats to terminate any of the Material Agreements. 

 2.7 Disclosure Controls and Procedures. Except as disclosed in the SEC Documents, the
Company has established and maintains disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) that are effective in all material respects to ensure that material information relating to the Company, including
any consolidated Subsidiaries, is made known to its chief executive officer and chief financial officer by others within those entities. The Company’s certifying officers have evaluated the effectiveness of the Company’s disclosure
controls and procedures as of the end of the period covered by the most recently filed quarterly or annual periodic report under the Exchange Act (such date, the “Evaluation Date”). The Company presented in its most recently
filed quarterly or annual periodic report under the Exchange Act the conclusions of the certifying officers about the effectiveness of the disclosure controls and procedures based on their evaluations as of the Evaluation Date. Since the Evaluation
Date, there have been no significant changes in the Company’s internal control over financial reporting (as such term is defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) or, to the Company’s knowledge, in other factors that could
significantly affect the Company’s internal control over financial reporting. 
 2.8 Accounting Controls. Except as
disclosed in the SEC Documents, the Company maintains a system of internal accounting controls sufficient to provide reasonable assurances that (i) transactions are executed in accordance with management’s general or specific
authorization, (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with generally accepted accounting principles as applied in the United States and to maintain accountability for assets,
(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 existing assets at reasonable intervals and appropriate
action is taken with respect to any differences. 
 2.9 Absence of Litigation. Except as disclosed in the SEC Documents
and except with respect to the Company’s pending litigation with MonoSol RX, LLC, as of the date hereof, there is no action, suit, proceeding or investigation before or by any court, public board, government agency, self-regulatory organization
or body pending or, to the Company’s knowledge, threatened against the Company that if determined adversely to the Company would reasonably be expected to have a Material Adverse Effect or would reasonably be expected to impair the ability of
the Company to perform its obligations under this Agreement. Neither the Company, nor any director or officer thereof, is or has been the subject of any action involving a claim of violation of or liability under federal or state securities laws or
a claim of breach of fiduciary duty relating to the Company. There has not been, and to the knowledge of the Company, there is not pending or contemplated, any investigation by the SEC of the Company or any current or former director or officer of
the Company. The Company has not received any stop order or other order suspending the effectiveness of any registration statement filed by the Company under the Exchange Act or the Securities Act and, to the Company’s knowledge, the SEC has
not issued any such order. 
 2.10 Intellectual Property Rights. The Company owns or possesses, or has a reasonable basis
on which it believes it can obtain on reasonable terms, licenses or sufficient rights to use all patents, patent applications, patent rights, inventions, know-how, trade secrets, trademarks, trademark applications, service marks, service names,
trade names and 

 
copyrights necessary to enable it to conduct its business as conducted as of the date hereof and, to its knowledge, as proposed to be conducted as described in the SEC Documents (the
“Intellectual Property”). To the Company’s knowledge, the Company has not infringed the intellectual property rights of third parties and no third party, to the Company’s knowledge, is infringing the Intellectual
Property, in each case, which could reasonably be expected to result in a Material Adverse Effect. Except as disclosed in the SEC Documents, there are no material options, licenses or agreements relating to the Intellectual Property, nor is the
Company bound by or a party to any material options, licenses or agreements relating to the patents, patent applications, patent rights, inventions, know-how, trade secrets, trademarks, trademark applications, service marks, service names, trade
names or copyrights of any other person or entity. There is no material claim or action or proceeding pending or, to the Company’s knowledge, threatened that challenges any of the rights of the Company in or to, or otherwise with respect to,
any Intellectual Property. 
 2.11 Placement Agent. The Company has taken no action that would give rise to any claim by
any person for brokerage commissions, placement agent’s fees or similar payments relating to this Agreement or the transactions contemplated hereby, except for dealings with the Placement Agent, whose commissions and fees will be paid by the
Company. 
 2.12 Investment Company. The Company is not and, after giving effect to the offering and sale of the Shares,
will not be an “investment company” as such term is defined in the Investment Company Act of 1940, as amended (the “Investment Company Act”). The Company shall conduct its business in a manner so that it will not
become subject to the Investment Company Act. 
 2.13 No Material Adverse Change. Since September 30, 2010, except
as described or referred to in the SEC Documents and except for cash expenditures in the ordinary course of business, there has not been any change in the assets, business, properties, financial condition or results of operations of the Company that
would reasonably be expected to have a Material Adverse Effect. Since September 30, 2010, (i) there has not been any dividend or distribution of any kind declared, set aside for payment, paid or made by the Company on any class of capital
stock, (ii) the Company has not sustained any material loss or interference with the Company’s business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor disturbance or dispute or any
action, order or decree of any court or arbitrator or governmental or regulatory authority, and (iii) the Company has not incurred any material liabilities except in the ordinary course of business. 

2.14 The Nasdaq Capital Market. The Common Stock is listed on The Nasdaq Capital Market, and, to the Company’s knowledge,
there are no proceedings to revoke or suspend such listing or the listing of the Shares. Except as disclosed in the SEC Documents, the Company is in compliance with the requirements of Nasdaq for continued listing of the Common Stock thereon and any
other Nasdaq listing and maintenance requirements. 
 2.15 Acknowledgment Regarding Purchasers’ Purchase of Shares.
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 this Agreement and the transactions contemplated

 
hereby. 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 Company) with respect to
this Agreement and the transactions contemplated hereby and any advice given by any Purchaser or any of their respective representatives or agents to the Company in connection with this Agreement and the transactions contemplated hereby is merely
incidental to such Purchaser’s purchase of the Shares. The Company further represents to each Purchaser that the Company’s decision to enter into this Agreement has been based on the independent evaluation of the transactions contemplated
hereby by the Company and its representatives. 
 2.16 Accountants. Cherry, Bekaert & Holland, L.L.P., who will
express their opinion with respect to the audited financial statements and schedules to be included as a part of any Registration Statement prior to the filing of any such Registration Statement, are independent accountants as required by the
Securities Act. 
 2.17 Insurance. The Company is insured by insurers of recognized financial responsibility against such
losses and risks and in such amounts as the Company believes are prudent and customary for a company (i) in the businesses and location in which the Company is engaged, (ii) with the resources of the Company, and (iii) at a similar
stage of development as the Company. The Company has not received any written notice that the Company will not be able to renew its existing insurance coverage as and when such coverage expires. The Company believes it will be able to obtain similar
coverage at reasonable cost from similar insurers as may be necessary to continue its business. 
 2.18 Foreign Corrupt
Practices. Since January 1, 2005, neither the Company, nor to the Company’s knowledge, any director, officer, agent, employee or other person acting on behalf of the Company has, in the course of its actions for, or on behalf of, the
Company (i) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expenses relating to political activity; (ii) made any direct or indirect unlawful payment to any foreign or domestic government
official or employee from corporate funds; (iii) violated or is in violation of in any material respect any provision of the U.S. Foreign Corrupt Practices Act of 1977, as amended; or (iv) made any unlawful bribe, rebate, payoff, influence
payment, kickback or other unlawful payment to any foreign or domestic government official or employee. 
 2.19 Private
Placement. Neither the Company nor its Subsidiary or any 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 any
circumstances that would require registration of the Shares under the Securities Act. Assuming the accuracy of the representations and warranties of the Purchasers contained in Article 3 hereof, the issuance of the Shares is exempt from registration
under the Securities Act. 
 2.20 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 SEC Documents, require the Company to register any securities for sale under the Securities Act by reason of the filing of a Registration Statement except in the case of
clause (ii) for rights which have been properly waived. The granting and performance of the registration rights under this 

 
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.

 2.21 Taxes. The Company has filed (or has obtained an extension of time within which to file) all necessary federal,
state and foreign income and franchise tax returns and has paid all taxes shown as due on such tax returns, except where the failure to so file or the failure to so pay would not reasonably be expected to have a Material Adverse Effect. 

2.22 Real and Personal Property. The Company has good and marketable title to, or has valid rights to lease or otherwise use, all
items of real and personal property that are material to the business of the Company free and clear of all liens, encumbrances, claims and defects and imperfections of title except those that (i) do not materially interfere with the use of such
property by the Company or (ii) would not reasonably be expected to have a Material Adverse Effect. 
 2.23 Application
of Takeover Protections. The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby will not impose any restriction on any Purchaser, or create in any party (including any current stockholder of the
Company) any rights, under any share acquisition, business combination, poison pill (including any distribution under a rights agreement), or other similar anti-takeover provisions under the Company’s charter documents or the laws of its state
of incorporation. 
 2.24 No Manipulation of Stock. The Company has not taken, nor will it take, directly or indirectly
any action designed to stabilize or manipulate the price of the Common Stock or any security of the Company to facilitate the sale or resale of any of the Shares. 
 2.25 Related Party Transactions. All transactions that have occurred between or among the Company, on the one hand, and any of its officers or directors, or any affiliate or affiliates of any such
officer or director, on the other hand, prior to the date hereof have been disclosed in the SEC Documents. 
 2.26 Use of
Proceeds. The Company shall use the net proceeds of the sale of the Shares hereunder for research and development of the Company’s product candidates, working capital and general corporate purposes. 

ARTICLE 3 

PURCHASER’S REPRESENTATIONS AND WARRANTIES 
 Each Purchaser represents and warrants to the Company, severally and not jointly, with respect to itself and its purchase hereunder, that: 

3.1 Investment Purpose. The Purchaser is purchasing the Shares for its own account and not with a present view toward the public
sale or distribution thereof and has no intention of selling or distributing any of such Shares or any arrangement or understanding with any other persons regarding the sale or distribution of such Shares except in accordance with the provisions of
Article 6 and except as would not result in a violation of the Securities 

 
Act. The Purchaser will not, directly or indirectly, offer, sell, pledge, transfer or otherwise dispose of (or solicit any offers to buy, purchase or otherwise acquire or take a pledge of) any of
the Shares except in accordance with the provisions of Article 6 or pursuant to and in accordance with the Securities Act. 

3.2 [Intentionally Omitted]. 
 3.3 Reliance on Exemptions. The Purchaser understands that the Shares are being offered and sold to it in reliance upon specific exemptions from the registration requirements of United States
federal and state securities laws and that the Company is relying upon the truth and accuracy of, and the Purchaser’s compliance with, the representations, warranties, agreements, acknowledgments and understandings of the Purchaser set forth
herein in order to determine the availability of such exemptions and the eligibility of the Purchaser to acquire the Shares. 

3.4 Information. The Purchaser has been furnished with all relevant materials relating to the business, finances and operations of
the Company necessary to make an investment decision, and materials relating to the offer and sale of the Shares, that have been requested by the Purchaser, including, without limitation, the SEC Documents, and the Purchaser has had the opportunity
to review the SEC Documents. The Purchaser has been afforded the opportunity to ask questions of the Company regarding the Company, including without limitation, all aspects of the Company’s business, operations, financial condition, prospects,
intellectual property and pending disputes. Neither such inquiries nor any other investigation conducted by or on behalf of such Purchaser or its representatives or counsel shall modify, amend or affect such Purchaser’s right to rely on the
truth, accuracy and completeness of the SEC Documents and the Company’s representations and warranties contained in the Agreement, it being agreed that the Company has made and does not make any representations or warranties to any Purchaser
expect as expressly set forth herein. 
 3.5 Acknowledgement of Risk. 

(a) The Purchaser acknowledges and understands that its investment in the Shares involves a significant degree of risk, including,
without limitation, (i) the Company remains an early stage business with limited operating history and requires substantial funds in addition to the proceeds from the sale of the Shares; (ii) an investment in the Company is speculative,
and only Purchasers who can afford the loss of their entire investment should consider investing in the Company and the Shares; (iii) the Purchaser may not be able to liquidate its investment; (iv) transferability of the Shares is
extremely limited; (v) in the event of a disposition of the Shares, the Purchaser could sustain the loss of its entire investment; and (vi) the Company has not paid any dividends on its Common Stock since inception and does not anticipate
the payment of dividends in the foreseeable future. The Purchaser acknowledges that risks factors related to the Company and an investment in the Company are more fully set forth in the SEC Documents and that Purchaser has reviewed such risk
factors. 
 (b) The Purchaser is able to bear the economic risk of holding the Shares for an indefinite period, and has
knowledge and experience in financial and business matters such that it is capable of evaluating the risks of the investment in the Shares; and 

 (c) The Purchaser has, in connection with the Purchaser’s decision to purchase Shares,
not relied upon any representations, warranties or other information (whether oral or written) of or related to the Company other than: (i) those representations and warranties of the Company specifically set forth herein and (ii) the
information contained in the SEC Documents, and the Purchaser has, with respect to all matters relating to this Agreement and the offer and sale of the Shares, relied solely upon the advice of such Purchaser’s own counsel and has not relied
upon or consulted any counsel to the Placement Agent or counsel to the Company. 
 3.6 Governmental Review. The Purchaser
understands that no United States federal or state agency or any other government or governmental agency has passed upon or made any recommendation or endorsement of the Shares or an investment therein. 

3.7 Transfer or Resale. The Purchaser understands that: 
 (a) the Shares have not been and are not being registered under the Securities Act (other than as contemplated in Article 6) or any applicable state securities laws and, consequently, the Purchaser may
have to bear the risk of owning the Shares for an indefinite period of time because the Shares may not be transferred unless (i) the resale of the Shares is registered pursuant to an effective registration statement under the Securities Act, as
contemplated in Article 6; (ii) the Purchaser has delivered to the Company an opinion of counsel (in form, substance and scope customary for opinions of counsel in comparable transactions) to the effect that the Shares to be sold or
transferred may be sold or transferred pursuant to an exemption from such registration; or (iii) the Shares are sold or transferred pursuant to Rule 144; 
 (b) any sale of the Shares made in reliance on Rule 144 may be made only in accordance with the terms of Rule 144 and, if Rule 144 is not applicable, any resale of the Shares under circumstances in which
the seller (or the person through whom the sale is made) may be deemed to be an underwriter (as that term is defined in the Securities Act) may require compliance with some other exemption under the Securities Act or the rules and regulations of the
SEC thereunder; and 
 (c) except as set forth in Article 6, neither the Company nor any other person is under any obligation to
register the resale of the Shares under the Securities Act or any state securities laws or to comply with the terms and conditions of any exemption thereunder. 
 3.8 Legends. 
 (a) The Purchaser understands the certificates representing
the Shares will bear a restrictive legend in substantially the following form (and a stop-transfer order may be placed against transfer of the certificates for such Shares): 
 THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES. THE SECURITIES MAY NOT BE
SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED, 

 
TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER APPLICABLE SECURITIES LAWS, OR UNLESS OFFERED, SOLD, PLEDGED, HYPOTHECATED OR TRANSFERRED
PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THOSE LAWS. THE COMPANY SHALL BE ENTITLED TO REQUIRE AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED TO THE EXTENT THAT SUCH OPINION IS
REQUIRED PURSUANT TO THAT CERTAIN SECURITIES PURCHASE AGREEMENT UNDER WHICH THE SECURITIES WERE ISSUED. 
 (b) To the extent the
resale of the Shares is registered under the Securities Act pursuant to an effective Registration Statement, the Company agrees to promptly (i) authorize the removal of the legend set forth in Section 3.8(a) and any other legend not
required by applicable law from such Shares and (ii) cause its transfer agent to issue such Shares without such legends to the holders thereof by electronic delivery at the applicable balance account at the Depository Trust Company upon
surrender of any stock certificates evidencing such Shares. With respect to any Shares for which restrictive legends are removed pursuant to this Section 3.8(b), the holder thereof agrees to only sell such Shares when and as permitted by the
effective registration statement covering such resale and in accordance with applicable securities laws and regulations. Any fees (with respect to the Company’s transfer agent, counsel or otherwise) associated with the removal of such legend(s)
shall be borne by the Company. 
 (c) The Purchaser may request that the Company remove, and the Company agrees to authorize the
removal of any legend from the Shares (i) following any sale of the Shares pursuant to Rule 144, or (ii) if such Shares are eligible for sale under Rule 144 following the expiration of the one-year holding requirement under subparagraphs
(b)(1)(i) and (d) thereof. Following the time a legend is no longer required for the Shares under this Section 3.8(c), the Company will, no later than three Business Days following the delivery by a Purchaser to the Company or the
Company’s transfer agent of a legended certificate representing such securities, deliver or cause to be delivered to such Purchaser a certificate representing such securities that is free from all restrictive and other legends. 

3.9 Authorization; Enforcement. The Purchaser has the requisite power and authority to enter into this Agreement and to consummate
the transactions contemplated hereby. The Purchaser has taken all necessary action to authorize the execution, delivery and performance of this Agreement. Upon the execution and delivery of this Agreement, this Agreement shall constitute a valid and
binding obligation of the Purchaser enforceable in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ and contracting
parties’ rights generally and except as enforceability may be subject to general principles of equity and except as rights to indemnity and contribution may be limited by state or federal securities laws or public policy underlying such laws.

 3.10 Residency. The Purchaser is a resident of the jurisdiction set forth immediately below such Purchaser’s name
on the signature pages hereto. 

 3.11 No Short Sales. Between the time the Purchaser learned about the Offering and
the public announcement of the Offering, the Purchaser has not engaged in any short sales or similar transactions with respect to the Common Stock or any derivative thereof, nor has the Purchaser, directly or indirectly, caused any Person to engage
in any short sales or similar transactions with respect to the Common Stock or any derivative thereof, including, without limitation, and in each case, in any transaction aimed, directly or indirectly, at affecting the price of the Common Stock
listed on Nasdaq for purposes of the transactions contemplated by this Agreement. 
 3.12 Acknowledgements Regarding
Placement Agent. The Purchaser acknowledges that the Placement Agent are acting as the exclusive placement agents on a “best efforts” basis for the Shares being offered hereby and will be compensated by the Company for acting in such
capacity. The Purchaser represents that (i) if applicable, the Purchaser was contacted regarding the sale of the Shares by the Placement Agent (or an authorized agent or representative thereof) with whom the Purchaser entered into a
confidentiality agreement and (ii) no Shares were offered or sold to it by means of any form of general solicitation or general advertising. 
 ARTICLE 4 
 COVENANTS 

4.1 Reporting Status. The Common Stock is registered under Section 12 of the Exchange Act. During the Registration Period,
the Company will timely file all documents with the SEC, and the Company will not terminate its status as an issuer required to file reports under the Exchange Act even if the Exchange Act or the rules and regulations thereunder would permit such
termination. 
 4.2 Expenses. The Company and each Purchaser is liable for, and will pay, its own expenses incurred in
connection with the negotiation, preparation, execution and delivery of this Agreement, including, without limitation, attorneys’ and consultants’ fees and expenses. 
 4.3 Financial Information. The financial statements of the Company to be included in any documents filed with the SEC will be prepared in accordance with accounting principles generally accepted in
the United States, consistently applied (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, may be
condensed or summary statements or may conform to the SEC’s rules and instructions for Reports on Form 10-Q), and will fairly present in all material respects the consolidated financial position of the Company and consolidated results of its
operations and cash flows as of, and for the periods covered by, such financial statements (subject, in the case of unaudited statements, to normal and recurring year-end audit adjustments). 

4.4 Securities Laws Disclosure; Publicity. On or before 9:30 a.m., New York local time, on March 11, 2011 the Company shall
issue a press release announcing the signing of this Agreement and describing the terms of the transactions contemplated by this Agreement. On or before March 17, 2011, the Company shall file the Form 10-K and a

 
Current Report on Form 8-K with the SEC describing the terms of the transactions contemplated by this Agreement and including as an exhibit to such Current Report on Form 8-K this Agreement, in
the form required by the Exchange Act. The Company shall not otherwise publicly disclose the name of any Purchaser, or include the name of any Purchaser in any filing with the SEC (other than in a Registration Statement and any exhibits to filings
made in respect of this transaction in accordance with periodic filing requirements under the Exchange Act) or any regulatory agency, without the prior written consent of such Purchaser, except to the extent such disclosure is required by law or
regulations, in which case the Company shall provide the Purchasers with prior notice of such disclosure. 
 4.5 Sales by
Purchasers. Each Purchaser will sell any Shares held by it in compliance with applicable prospectus delivery requirements, if any, or otherwise in compliance with the requirements for an exemption from registration under the Securities Act and
the rules and regulations promulgated thereunder. No Purchaser will make any sale, transfer or other disposition of the Shares in violation of federal or state securities laws. 
 ARTICLE 5 
 CONDITIONS TO CLOSING 

5.1 Conditions to Obligations of the Company. The Company’s obligation to complete the purchase and sale of the Shares to
each Purchaser is subject to the waiver by the Company or fulfillment as of the Closing Date of the following conditions: 
 (a)
Receipt of Funds. The Company shall have received immediately available funds in the full amount of the purchase price for the Shares being purchased hereunder as set forth opposite such Purchaser’s name on Exhibit A hereto.

 (b) Representations and Warranties. The representations and warranties made by each Purchaser in Article 3 shall be
true and correct in all material respects as of the Closing Date. 
 (c) Covenants. All covenants, agreements and
conditions contained in this Agreement to be performed by the Purchasers on or prior to the Closing Date shall have been performed or complied with in all material respects. 
 (d) Blue Sky. The Company shall have obtained all necessary blue sky law permits and qualifications, or secured exemptions therefrom, required by any state for the offer and sale of the Shares.

 (e) Nasdaq Qualification. The Shares to be issued shall be duly authorized for listing by Nasdaq, subject to official
notice of issuance, to the extent required by the rules of Nasdaq. 
 (f) Absence of Litigation. No proceeding
challenging this Agreement or the transactions contemplated hereby, or seeking to prohibit, alter, prevent or materially delay the Closing, shall have been instituted or be pending before any court, arbitrator, governmental body, agency or official.

 (g) No Governmental Prohibition. The sale of the Shares by the Company shall not be
prohibited by any law or governmental order or regulation. 
 5.2 Conditions to Purchasers’ Obligations at the Closing.
Each Purchaser’s obligation to complete the purchase and sale of the Shares is subject to the waiver by such Purchaser or fulfillment as of the Closing Date of the following conditions: 

(a) Representations and Warranties. The representations and warranties made by the Company in Article 2 shall be true and correct
in all material respects as of the Closing Date. 
 (b) Covenants. All covenants, agreements and conditions contained in
this Agreement to be performed by the Company on or prior to the Closing Date shall have been performed or complied with in all material respects. 
 (c) 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. 
 (d) Legal Opinion. The Company shall have delivered to such Purchaser an opinion, dated
as of the Closing Date, from Ellenoff Grossman & Schole LLP, counsel to the Company, in substantially the form attached hereto as Exhibit B hereto. 
 (e) Transfer Agent Instructions. The Company shall have delivered to its transfer agent irrevocable instructions to issue to such Purchaser or in such nominee name(s) as designated by such
Purchaser in writing such number of Shares set forth opposite such Purchaser’s name on Exhibit A hereto or, if requested by the Purchaser, one or more certificates representing such Shares. 

(f) Nasdaq Qualification. The Shares shall be duly authorized for listing by Nasdaq, subject to official notice of issuance, to
the extent required by the rules of Nasdaq. 
 (g) Absence of Litigation. No proceeding challenging this Agreement or the
transactions contemplated hereby, or seeking to prohibit, alter, prevent or materially delay the Closing, shall have been instituted or be pending before any court, arbitrator, governmental body, agency or official. 

(h) No Governmental Prohibition. The sale of the Shares by the Company shall not be prohibited by any law or governmental order or
regulation. 
 (i) Minimum Aggregate Investment. The Company shall have received at the Closing at least $12.5 million of
aggregate gross proceeds from the sale of Shares hereunder. 

 ARTICLE 6 
 REGISTRATION RIGHTS 
 6.1 (a) As soon as reasonably
practicable, but in no event later than 30 days after the Closing Date (the “Filing Date”), the Company shall file a registration statement covering the resale of the Registrable Shares with the SEC for an offering to be made
on a continuous basis pursuant to Rule 415, or if Rule 415 is not available for offers and sales of the Registrable Shares, by such other means of distribution of Registrable Shares as the Holders of a majority of the Registrable Shares may
reasonably specify (the “Initial Registration Statement”). The Initial Registration Statement shall be on Form S-3 (except if the Company is ineligible to register for resale the Registrable Shares on Form S-3, in which case
such registration shall be on another appropriate form). 
 (b) The Company shall use its best efforts to effect the
registration (including a declaration of effectiveness thereof by the SEC) and applicable qualifications or compliances (including, without limitation, the execution of any required undertaking to file post-effective amendments, appropriate
qualifications or exemptions under applicable blue sky or other state securities laws and appropriate compliance with applicable securities laws, requirements or regulations) as promptly as possible after the filing thereof, but in any event prior
to the date which is 60 days after the Filing Date (the “Effectiveness Date”); provided, however, that in the event that Initial Registration Statement is reviewed by the SEC, then the Effectiveness Date shall be
extended to one hundred twenty (120) days following the Filing Date. For purposes of clarification, any failure by the Company to file the Initial Registration Statement by the Filing Date or to effect such Registration Statement the
Effectiveness Date shall not otherwise relieve the Company of its obligations to file or effect the Initial Registration Statement as set forth above in this Section 6.1. 
 (c) In the event the SEC informs the Company that all of the Registrable Shares cannot, as a result of the application of Rule 415, be registered for resale as a secondary offering on a single
registration statement, the Company agrees to promptly (i) inform each of the Holders thereof, (ii) use its reasonable efforts to file amendments to the Initial Registration Statement as required by the SEC and/or (iii) withdraw the
Initial Registration Statement and file a new registration statement (a “New Registration Statement”), in either case covering the maximum number of Registrable Shares permitted to be registered by the SEC, on Form S-3 or, if
the Company is ineligible to register for resale the Registrable Shares on Form S-3, such other form available to register for resale the Registrable Shares as a secondary offering; provided, however, that prior to filing such amendment
or New Registration Statement, the Company shall be obligated to use its reasonable efforts to advocate with the SEC for the registration of all of the Registrable Shares. In the event the Company amends the Initial Registration Statement or files a
New Registration Statement, as the case may be, under clauses (ii) or (iii) above, the Company will use its reasonable efforts to file with the SEC, as promptly as allowed by the SEC, one or more registration statements on Form S-3 or, if
the Company is ineligible to register for resale the Registrable Shares on Form S-3, such other form available to register for resale those Registrable Shares that were not registered for resale on the Initial Registration Statement, as amended, or
the New Registration Statement (the “Remainder Registration Statements”). 

 
Notwithstanding any other provision of this Agreement and subject to the payment of damages in Section 6.3, if the SEC limits the number of Registrable Shares permitted to be registered on a
particular Registration Statement (and notwithstanding that the Company used diligent efforts to advocate with the SEC for the registration of all or a greater number of Registrable Shares), any required cutback of Registrable Shares shall be
applied to the Purchasers pro rata in accordance with the number of such Registrable Shares sought to be included in such Registration Statement by reference to the amount of Registrable Shares set forth opposite such Purchaser’s name on
Exhibit A (and in the case of a subsequent transfer, the initial Purchaser’s) relative to the aggregate amount of all Registrable Shares. 
 6.2 All Registration Expenses incurred in connection with any registration, qualification, exemption or compliance pursuant to Section 6.1 shall be borne by the Company. All Selling Expenses
relating to the sale of securities registered by or on behalf of Holders shall be borne by such Holders pro rata on the basis of the number of securities so registered. 
 6.3 The Company further agrees that, in the event that (i) the Initial Registration Statement has not been filed with the SEC within 30 days after the Closing Date, (ii) the Initial
Registration Statement or the New Registration Statement, as applicable, has not been declared effective by the SEC by the Effectiveness Date, or (iii) after such Registration Statement is declared effective by the SEC, is suspended by the
Company or ceases to remain continuously effective as to all Registrable Shares for which it is required to be effective, other than, in each case, within the time period(s) permitted by Section 6.7(b) (each such event referred to in clauses
(i), (ii) and (iii), (a “Registration Default”)), for all or part of any thirty-day period (a “Penalty Period”) during which the Registration Default remains uncured (which initial thirty-day
period shall commence on the fifth Business Day after the date of such Registration Default if such Registration Default has not been cured by such date), the Company shall pay to each Purchaser 1% of such Purchaser’s aggregate purchase price
of his or her Shares for each Penalty Period during which the Registration Default remains uncured; provided, however, that if a Purchaser fails to provide the Company with any information that is required to be provided in such Registration
Statement with respect to such Purchaser as set forth herein, then the commencement of the Penalty Period described above shall be extended until two Business Days following the date of receipt by the Company of such required information; and
provided, further, that in no event shall the Company be required hereunder to pay to any Purchaser pursuant to this Agreement more than 1% of such Purchaser’s aggregate purchase price of his or her securities in any Penalty Period and in
no event shall the Company be required hereunder to pay to any Purchaser pursuant to this Agreement an aggregate amount that exceeds 8.0% of the aggregate Purchase Price paid by such Purchaser for such Purchaser’s Shares. The Company shall
deliver said cash payment to the Purchaser by the fifth Business Day after the end of such Penalty Period. If the Company fails to pay said cash payment to the Purchasers in full by the fifth Business Day after the end of such Penalty Period, the
Company will pay interest thereon at a rate of 12% per annum (or such lesser maximum amount that is permitted to be paid by applicable law) to the Purchasers, accruing daily from the date such liquidated damages are due until such amounts, plus
all such interest thereon, are paid in full. Notwithstanding the foregoing, in the event a Registration Default occurs pursuant to clause (iii) hereof, the 1% of liquidated damages referred to above for any Penalty Period shall be reduced to
equal the percentage determined 

 
by multiplying 1% by a fraction, the numerator of which shall be the number of Registrable Shares covered by the Registration Statement that is suspended by the Company or ceases to remain
continuously effective as to all Registrable Shares for which it is required to be effective which are still Registrable Shares at such time and for which there is not otherwise an effective Registration Statement at such time and the denominator of
which shall be the number of Registrable Shares at such time. 
 6.4 In the case of the registration, qualification,
exemption or compliance effected by the Company pursuant to this Agreement, the Company shall, upon reasonable request, inform each Holder as to the status of such registration, qualification, exemption and compliance. At its expense the Company
shall: 
 (a) except for such times as the Company is permitted hereunder to suspend the use of the prospectus forming part of a
Registration Statement, use its commercially reasonable efforts to keep such registration, and any qualification, exemption or compliance under state securities laws which the Company determines to obtain, continuously effective with respect to a
Holder, and to keep the applicable Registration Statement free of any material misstatements or omissions, until the date by which all the Shares may be sold without restriction under Rule 144, including, without limitation, any volume and manner of
sale restrictions which may be applicable to affiliates under Rule 144. The period of time during which the Company is required hereunder to keep a Registration Statement effective is referred to herein as the “Registration
Period.” 
 (b) advise the Holders within five Business Days: 

(i) when a Registration Statement or any amendment thereto has been filed with the SEC and when such Registration Statement or any
post-effective amendment thereto has become effective; 
 (ii) of any request by the SEC for amendments or supplements to any
Registration Statement or the prospectus included therein or for additional information; 
 (iii) of the issuance by the SEC of
any stop order suspending the effectiveness of any Registration Statement or the initiation of any proceedings for such purpose; 
 (iv) of the receipt by the Company of any notification with respect to the suspension of the qualification of the Registrable Shares included therein for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose; and 
 (v) subject to the provisions this Agreement, of the occurrence of any
event that requires the making of any changes in any Registration Statement or prospectus so that, as of such date, the statements therein are not misleading and do not omit to state a material fact required to be stated therein or necessary to make
the statements therein (in the case of a prospectus, in the light of the circumstances under which they were made) not misleading; 
 (c) use its commercially reasonable efforts to obtain the withdrawal of any order suspending the effectiveness of any Registration Statement as soon as reasonably practicable; 

 (d) if a Holder so requests in writing, promptly furnish to each such Holder, without
charge, at least one copy of each Registration Statement and each post-effective amendment thereto, including financial statements and schedules, and, if explicitly requested, all exhibits in the form filed with the SEC; 

(e) during the Registration Period, promptly deliver to each such Holder, without charge, as many copies of each prospectus included in a
Registration Statement and any amendment or supplement thereto as such Holder may reasonably request in writing; and the Company consents to the use, consistent with the provisions hereof, of the prospectus or any amendment or supplement thereto by
each of the selling Holders of Registrable Shares in connection with the offering and sale of the Registrable Shares covered by a prospectus or any amendment or supplement thereto; 

(f) during the Registration Period, if a Holder so requests in writing, deliver to each Holder, without charge, (i) one copy of the
following documents, other than those documents available via the SEC’s EDGAR system: (A) its annual report to its stockholders, if any (which annual report shall contain financial statements audited in accordance with generally accepted
accounting principles in the United States of America by a firm of certified public accountants of recognized standing), (B) if not included in substance in its annual report to stockholders, its annual report on Form 10-K (or similar form),
(C) its definitive proxy statement with respect to its annual meeting of stockholders, (D) each of its quarterly reports to its stockholders, and, if not included in substance in its quarterly reports to stockholders, its quarterly report
on Form 10-Q (or similar form), and (E) a copy of each full Registration Statement (the foregoing, in each case, excluding exhibits); and (ii) if explicitly requested, all exhibits excluded by the parenthetical to the immediately preceding
clause (E); 
 (g) prior to any public offering of Registrable Shares pursuant to any Registration Statement, promptly take such
actions as may be necessary to register or qualify or obtain an exemption for offer and sale under the securities or blue sky laws of such United States jurisdictions as any such Holders reasonably request in writing, provided that the Company shall
not for any such purpose be required to qualify generally to transact business as a foreign corporation in any jurisdiction where it is not so qualified or to consent to general service of process in any such jurisdiction, and do any and all other
acts or things reasonably necessary or advisable to enable the offer and sale in such jurisdictions of the Registrable Shares covered by any such Registration Statement; 
 (h) upon the occurrence of any event contemplated by Section 6.4(b)(v) above, except for such times as the Company is permitted hereunder to suspend the use of a prospectus forming part of a
Registration Statement, the Company shall use its commercially reasonable efforts to as soon as reasonably practicable prepare a post-effective amendment to such Registration Statement or a supplement to the related prospectus, or file any other
required document so that, as thereafter delivered to purchasers of the Registrable Shares included therein, such prospectus will not include any untrue statement of a material fact or omit to state any material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not misleading; 

 (i) otherwise use its commercially reasonable efforts to comply in all material respects
with all applicable rules and regulations of the SEC which could affect the sale of the Registrable Shares; 
 (j) use its
commercially reasonable efforts to cause all Registrable Shares to be listed on each securities exchange or market, if any, on which equity securities issued by the Company have been listed; 

(k) use its commercially reasonable efforts to take all other steps necessary to effect the registration of the Registrable Shares
contemplated hereby and to enable the Holders to sell Registrable Shares under Rule 144; 
 (l) provide to each Purchaser and
its representatives, if requested, the opportunity (under cover of a confidentiality agreement, if requested by the Company) to conduct a reasonable inquiry of the Company’s financial and other records during normal business hours and make
available its officers, directors and employees for questions regarding information which such Purchaser may reasonably request in order to fulfill any required due diligence obligation on its part; and 

(m) permit a single counsel for the Purchasers to review any Registration Statement and all amendments and supplements thereto, within
two Business Days prior to the filing thereof with the SEC; 
 provided that, in the case of clauses (l) and (m) above, the
Company shall not be required (A) to delay the filing of any Registration Statement or any amendment or supplement thereto as a result of any ongoing diligence inquiry by or on behalf of a Holder or to incorporate any comments to any
Registration Statement or any amendment or supplement thereto by or on behalf of a Holder if such inquiry or comments would require a delay in the filing of such Registration Statement, amendment or supplement, as the case may be, or (B) to
provide, and shall not provide, any Purchaser or its representatives with material, non-public information unless such Purchaser agrees to receive such information and enters into a written confidentiality agreement with the Company in a form
reasonably acceptable to the Company. 
 6.5 The Holders shall have no right to take any action to restrain, enjoin or
otherwise delay any registration pursuant to Section 6.1 hereof as a result of any controversy that may arise with respect to the interpretation or implementation of this Agreement. 

6.6 (a) To the extent permitted by law, the Company shall indemnify each Holder and each person controlling such Holder
within the meaning of Section 15 of the Securities Act, with respect to which any registration that has been effected pursuant to this Agreement, against all claims, losses, damages and liabilities (or action in respect thereof), including any
of the foregoing incurred in settlement of any litigation, commenced or threatened (subject to Section 6.6(c) below), arising out of or based on any untrue statement (or alleged untrue statement) of a material fact contained in any Registration
Statement, prospectus, any amendment or supplement thereof, or other document incident to any such registration, qualification or compliance or based on any omission (or alleged omission) to state therein a

 
material fact required to be stated therein or necessary to make the statements therein not misleading, in light of the circumstances in which they were made, or any violation by the Company of
any rule or regulation promulgated by the Securities Act applicable to the Company and relating to any action or inaction required of the Company in connection with any such registration, qualification or compliance, and will reimburse each Holder
and each person controlling such Holder, for reasonable legal and other out-of-pocket expenses reasonably incurred in connection with investigating or defending any such claim, loss, damage, liability or action as incurred; provided that the Company
will not be liable in any such case to the extent that any untrue statement or omission or allegation thereof is made in reliance upon and in conformity with written information furnished to the Company by or on behalf of such Holder for use in
preparation of any Registration Statement, prospectus, amendment or supplement; provided however, that the Company will not be liable in any such case where the claim, loss, damage or liability arises out of or is related to the failure of
such Holder to comply with the covenants and agreements contained in this Agreement respecting sales of Registrable Shares, and except that the foregoing indemnity agreement is subject to the condition that, insofar as it relates to any such untrue
statement or alleged untrue statement or omission or alleged omission made in any preliminary prospectus but eliminated or remedied in the amended prospectus on file with the SEC at the time any Registration Statement becomes effective or in an
amended prospectus filed with the SEC pursuant to Rule 424(b) which meets the requirements of Section 10(a) of the Securities Act (each, a “Final Prospectus”), such indemnity shall not inure to the benefit of any such
Holder or any such controlling person, if a copy of a Final Prospectus furnished by the Company to the Holder for delivery was not furnished to the person or entity asserting the loss, liability, claim or damage at or prior to the time such
furnishing is required by the Securities Act and a Final Prospectus would have cured the defect giving rise to such loss, liability, claim or damage. 
 (b) Each Holder will severally, and not jointly, indemnify the Company, each of its directors and officers, and each person who controls the Company within the meaning of Section 15 of the Securities
Act, against all claims, losses, damages and liabilities (or actions in respect thereof), including any of the foregoing incurred in settlement of any litigation, commenced or threatened (subject to Section 6.6(c) below), arising out of or
based on any untrue statement (or alleged untrue statement) of a material fact contained in any Registration Statement, prospectus, or any amendment or supplement thereof, incident to any such registration, or based on any omission (or alleged
omission) to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, in light of the circumstances in which they were made, and will reimburse the Company, such directors and officers,
and each person controlling the Company for reasonable legal and any other expenses reasonably incurred in connection with investigating or defending any such claim, loss, damage, liability or action as incurred, in each case to the extent, but only
to the extent, that such untrue statement or omission or allegation thereof is made in reliance upon and in conformity with written information furnished to the Company by or on behalf of the Holder for use in preparation of any Registration
Statement, prospectus, amendment or supplement; provided that the indemnity shall not apply to the extent that such claim, loss, damage or liability results from the fact that a current copy of a prospectus was not made available to the person or
entity asserting the loss, liability, claim or damage at or prior to the time such furnishing is required by the Securities Act and a Final Prospectus would have cured the defect giving rise to such loss, claim, damage or liability. Notwithstanding
the 

 
foregoing, a Holder’s aggregate liability pursuant to this subsection (b) and subsection (d) shall be limited to the net amount received by the Holder from the sale of the
Registrable Shares. 
 (c) Each party entitled to indemnification under this Section 6.6 (the “Indemnified
Party”) shall give notice to the party required to provide indemnification (the “Indemnifying Party”) promptly after such Indemnified Party has actual knowledge of any claim as to which indemnity may be sought,
and shall permit the Indemnifying Party (at its expense) to assume the defense of any such claim or any litigation resulting therefrom, provided that counsel for the Indemnifying Party, who shall conduct the defense of such claim or litigation,
shall be approved by the Indemnified Party (whose approval shall not unreasonably be withheld), and the Indemnified Party may participate in such defense at such Indemnified Party’s expense, and provided further that the failure of any
Indemnified Party to give notice as provided herein shall not relieve the Indemnifying Party of its obligations under this Agreement, unless such failure is materially prejudicial to the Indemnifying Party in defending such claim or litigation. An
Indemnifying Party shall not be liable for any settlement of an action or claim effected without its written consent (which consent will not be unreasonably withheld). No Indemnifying Party, in its defense of any such claim or litigation, shall,
except with the consent of each Indemnified Party, consent to entry of any judgment or enter into any settlement which does not include as an unconditional term thereof the giving by the claimant or plaintiff to such Indemnified Party of a release
from all liability in respect to such claim or litigation. 
 (d) If the indemnification provided for in this Section 6.6
is held by a court of competent jurisdiction to be unavailable to an Indemnified Party with respect to any loss, liability, claim, damage or expense referred to therein, then the Indemnifying Party, in lieu of indemnifying such Indemnified Party
thereunder, shall contribute to the amount paid or payable by such Indemnified Party as a result of such loss, liability, claim, damage or expense in such proportion as is appropriate to reflect the relative fault of the Indemnifying Party on the
one hand and of the Indemnified Party on the other in connection with the statements or omissions which resulted in such loss, liability, claim, damage or expense as well as any other relevant equitable considerations. The relative fault of the
Indemnifying Party and of the Indemnified Party shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission to state a material fact relates to information supplied by
the Indemnifying Party or by the Indemnified Party and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. 

6.7 (a) Each Holder agrees that, upon receipt of any notice from the Company of the happening of any event requiring the
preparation of a supplement or amendment to a prospectus relating to Registrable Shares so that, as thereafter delivered to the Holders, such prospectus shall not contain an untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein not misleading, each Holder will forthwith discontinue disposition of Registrable Shares pursuant to a Registration Statement and prospectus contemplated by Section 6.1
until its receipt of copies of the supplemented or amended prospectus from the Company and, if so directed by the Company, each Holder shall deliver to the Company all copies, other than permanent file copies then in such Holder’s possession,
of the prospectus covering such Registrable Shares current at the time of receipt of such notice. 

 (b) Each Holder shall suspend, upon request of the Company, any disposition of Registrable
Shares pursuant to any Registration Statement and prospectus contemplated by Section 6.1 during no more than two periods of no more than 30 calendar days each during any 12-month period to the extent that the Board of Directors of the Company
determines in good faith that the sale of Registrable Shares under any such Registration Statement would be reasonably likely to cause a violation of the Securities Act or Exchange Act. 

(c) As a condition to the inclusion of its Registrable Shares, each Holder shall furnish to the Company such information regarding such
Holder and the distribution proposed by such Holder as the Company may reasonably request in writing, including completing a Registration Statement Questionnaire in the form provided by the Company, or as shall be required in connection with any
registration referred to in this Article 6. 
 (d) Each Holder hereby covenants with the Company (i) not to make any sale
of the Registrable Shares without effectively causing the prospectus delivery requirements under the Securities Act to be satisfied, and (ii) if such Registrable Shares are to be sold by any method or in any transaction other than on a national
securities exchange or in the over-the-counter market, in privately negotiated transactions, or in a combination of such methods, to notify the Company at least five Business Days prior to the date on which the Holder first offers to sell any such
Registrable Shares. 
 (e) Each Holder agrees not to take any action with respect to any distribution deemed to be made pursuant
to a Registration Statement which would constitute a violation of Regulation M under the Exchange Act or any other applicable rule, regulation or law. 
 (f) At the end of the Registration Period the Holders shall discontinue sales of shares pursuant to any Registration Statement upon receipt of notice from the Company of its intention to remove from
registration the shares covered by any such Registration Statement which remain unsold, and such Holders shall notify the Company of the number of shares registered which remain unsold immediately upon receipt of such notice from the Company.

 6.8 With a view to making available to the Holders the benefits of certain rules and regulations of the SEC which at
any time permit the sale of the Registrable Shares to the public without registration, so long as the Holders still own Registrable Shares, the Company shall use its reasonable best efforts to: 

(a) make and keep public information available, as those terms are understood and defined in Rule 144 under the Securities Act, at all
times; 
 (b) file with the SEC in a timely manner all reports and other documents required of the Company under the Exchange
Act; and 

 (c) so long as a Holder owns any Registrable Shares, furnish to such Holder, upon any
reasonable request, a written statement by the Company as to its compliance with Rule 144 under the Securities Act, and of the Exchange Act, a copy of the most recent annual or quarterly report of the Company, and such other reports and documents of
the Company as such Holder may reasonably request in availing itself of any rule or regulation of the SEC allowing a Holder to sell any such securities without registration. 
 6.9 The rights to cause the Company to register Registrable Shares granted to the Holders by the Company under Section 6.1 may be assigned by a Holder in connection with a transfer by such
Holder of all or a portion of its Registrable Shares, provided, however, that such transfer must be made at least ten days prior to the Filing Date and that (i) such transfer may otherwise be effected in accordance with applicable
securities laws; (ii) such Holder gives prior written notice to the Company at least ten days prior to the Filing Date; and (iii) such transferee agrees to comply with the terms and provisions of this Agreement, and such transfer is
otherwise in compliance with this Agreement. Except as specifically permitted by this Section 6.9, the rights of a Holder with respect to Registrable Shares as set out herein shall not be transferable to any other Person, and any attempted
transfer shall cause all rights of such Holder therein to be forfeited. 
 6.10 Prior to the time that Registration
Statement(s) covering the resale of all Registrable Shares have been declared effective by the SEC, the Company shall not file with the SEC a registration statement under the Securities Act of any of its equity securities other than a registration
statement required to be filed pursuant to this Agreement, a registration statement on Form S-8 or, in connection with an acquisition, a registration statement on Form S-4; provided, however, that the foregoing restrictions in this
Section 6.10 shall terminate upon such time as all of the Registrable Shares (i) have been publicly sold by the Holders or (ii) may be sold under Rule 144 during any 90 day period. 

6.11 The rights of any Holder under any provision of this Article 6 may be waived (either generally or in a particular instance,
either retroactively or prospectively and either for a specified period of time or indefinitely) or amended by an instrument in writing signed by such Holder. 
 ARTICLE 7 
 DEFINITIONS 

7.1 “Agreement” has the meaning set forth in the preamble. 

7.2 “Affiliate” means, with respect to any Person (as defined below), any other Person controlling,
controlled by or under direct or indirect common control with such Person (for the purposes of this definition “control,” when used with respect to any specified Person, shall mean the power to direct the management and
policies of such person, directly or indirectly, whether through ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” shall have meanings correlative
to the foregoing). 
 7.3 “Business Day” means a day Monday through Friday on which banks are
generally open for business in New York City. 

 7.4 “Bylaws” has the meaning set forth in Section 2.3.

 7.5 “Certificate of Incorporation” has the meaning set forth in Section 2.3. 

7.6 “Closing” has the meaning set forth in Section 1.3. 

7.7 “Closing Date” has the meaning set forth in Section 1.3. 

7.8 “Common Stock” means the common stock, par value $0.001 per share, of the Company. 

7.9 “Company” means BioDelivery Sciences International, Inc., a Delaware corporation. 

7.10 “Effectiveness Date” has the meaning set forth in Section 6.1(b). 

7.11 “Evaluation Date” has the meaning set forth in Section 2.7. 

7.12 “Exchange Act” means the Shares Exchange Act of 1934, as amended. 

7.13 “Filing Date” has the meaning set forth in Section 6.1(a). 

7.14 “Final Prospectus” has the meaning set forth in Section 6.6(a). 

7.15 “Financial Statements” means the financial statements of the Company included in the SEC
Documents. 
 7.16 “Financing” has the meaning set forth in Section 8.14. 

7.17 “Form 10-K” has the meaning set forth in Section 2.6. 

7.18 “Holders” means any person holding Registrable Shares or any person to whom the rights under Article
6 have been transferred in accordance with Section 6.9 hereof. 
 7.19 “Indemnified Party”
has the meaning set forth in Section 6.6(c). 
 7.20 “Indemnifying Party” has the
meaning set forth in Section 6.6(c). 
 7.21 “Initial Registration Statement” has the
meaning set forth in Section 6.1. 
 7.22 “Intellectual Property” has the meaning set forth
in Section 2.10. 
 7.23 “Investment Company Act” has the meaning set forth in
Section 2.12. 
 7.24 “Material Adverse Effect” means a material adverse effect on
(a) the business, operations, assets or financial condition of the Company, taken as a whole, or (b) the ability of the Company to perform its obligations pursuant to the transactions contemplated by this Agreement. 

 7.25 “Material Agreements” has the meaning set forth in
Section 2.6. 
 7.26 “Nasdaq” means The Nasdaq Stock Market LLC. 

7.27 “New Registration Statement” has the meaning set forth in Section 6.1(c). 

7.28 “Offering” means the private placement of the Company’s Shares contemplated by this Agreement.

 7.29 “Penalty Period” has the meaning set forth in Section 6.3. 

7.30 “Person” means any person, individual, corporation, limited liability company, partnership, trust or
other nongovernmental entity or any governmental agency, court, authority or other body (whether foreign, federal, state, local or otherwise). 
 7.31 “Placement Agent” means William Blair & Company, L.L.C. 
 7.32 “Purchasers” mean the Purchasers whose names are set forth on the signature pages of this Agreement, and their permitted transferees. 

7.33 “Purchase Price” has the meaning set forth in Section 1.1. 

7.34 The terms “register,” “registered” and “registration” refer to the
registration effected by preparing and filing a registration statement in compliance with the Securities Act, and the declaration or ordering of the effectiveness of such registration statement. 

7.35 “Registrable Shares” means the Shares; provided, however, that securities shall only be
treated as Registrable Shares if and only for so long as they (A) have not been disposed of pursuant to a registration statement declared effective by the SEC, (B) have not been sold in a transaction exempt from the registration and
prospectus delivery requirements of the Securities Act so that all transfer restrictions and restrictive legends with respect thereto are removed upon the consummation of such sale or (C) are held by a Holder or a permitted transferee pursuant
to Section 6.9. 
 7.36 “Registration Default” has the meaning set forth in
Section 6.3. 
 7.37 “Registration Expenses” means all expenses incurred by the Company in
complying with Section 6.1 hereof, including, without limitation, all registration, qualification and filing fees, printing expenses, escrow fees, fees and expenses of counsel for the Company, blue sky fees and expenses and the expense of any
special audits incident to or required by any such registration (but excluding the fees of legal counsel for any Holder). 

7.38 “Registration Statement” means any one or more registration statements of the Company filed under the
Securities Act that covers the resale of any of the Registrable Shares pursuant to the provisions of this Agreement (including without limitation the Initial Registration Statement, the New Registration Statement and any Remainder Registration
Statements) and amendments and supplements to such Registration Statements, including post-effective amendments. 

 7.39 “Registration Period” has the meaning set forth in
Section 6.4(a). 
 7.40 “Remainder Registration Statement” has the meaning set forth in
Section 6.1(c). 
 7.41 “Rule 144” means Rule 144 promulgated under the Securities Act, or
any successor rule. 
 7.42 “Rule 415” means Rule 415 promulgated under the Securities
Act, or any successor rule. 
 7.43 “SEC” means the United States Shares and Exchange Commission.

 7.44 “SEC Documents” has the meaning set forth in Section 2.6. 

7.45 “Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations
thereunder, or any similar successor statute. 
 7.46 “Selling Expenses” means all selling
commissions applicable to the sale of Registrable Shares and all fees and expenses of legal counsel for any Holder. 
 7.47
“Shares” has the meaning set forth in Section 1.1. 
 7.48 “Subsidiary”
of any person shall mean any corporation, partnership, limited liability company, joint venture or other legal entity of which such Person (either above or through or together with any other subsidiary) owns, directly or indirectly, more
than 50% of the stock or other equity interests the holders of which are generally entitled to vote for the election of the board of directors or other governing body of such corporation or other legal entity. 

7.49 “Third Party Rights” has the meaning set forth in Section 2.4. 

ARTICLE 8 

GOVERNING LAW; MISCELLANEOUS 
 8.1 Governing Law; Jurisdiction. This Agreement will be governed by and interpreted in accordance with the laws of the State of New York, without giving effect to any choice of law or conflict of
law provision or rule (whether of the State of New York or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of New York. 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, 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 brought in an inconvenient forum or that the
venue of 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 to such party at the address for such 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. 
 8.2 Counterparts; Signatures by Facsimile. This Agreement may be executed in two or more counterparts, all of which are considered one and the same agreement and will become effective when
counterparts have been signed by each party and delivered to the other parties. This Agreement, once executed by a party, may be delivered to the other parties hereto by facsimile or e-mail transmission of a copy of this Agreement bearing the
signature of the party so delivering this Agreement. 
 8.3 Headings. The headings of this Agreement are for convenience
of reference only, are not part of this Agreement and do not affect its interpretation. 
 8.4 Severability. If any
provision of this Agreement is invalid or unenforceable under any applicable statute or rule of law, then such provision will be deemed modified in order to conform with such statute or rule of law. Any provision hereof that may prove invalid or
unenforceable under any law will not affect the validity or enforceability of any other provision hereof. 
 8.5 Entire
Agreement; Amendments. This Agreement (including all schedules and exhibits hereto) constitutes the entire agreement among the parties hereto with respect to the subject matter hereof and thereof. There are no restrictions, promises, warranties
or undertakings, other than those set forth or referred to herein or therein. This Agreement supersedes all prior agreements and understandings among the parties hereto with respect to the subject matter hereof. No provision of this Agreement may be
waived or amended other than by an instrument in writing signed by the party to be charged with enforcement. Any amendment or waiver by a party effected in accordance with this Section 8.5 shall be binding upon such party, including with
respect to any Shares purchased under this Agreement at the time outstanding and held by such party (including securities into which such Shares are convertible and for which such Shares are exercisable) and each future holder of all such
securities. 
 8.6 Notices. All notices required or permitted hereunder shall be in writing and shall be deemed
effectively given: (a) upon personal delivery to the party to be notified, (b) when sent by confirmed facsimile transmission if sent during normal business hours of the recipient, if not, then on the next Business Day, (c) five days
after having been sent by registered or certified mail, return receipt requested, postage prepaid, or (d) one Business Day after deposit with a nationally recognized overnight courier, specifying next day delivery, with written verification of
receipt. The addresses for such communications are: 
  

					
	If to the Company:	  	BioDelivery Sciences International, Inc.
		  	801 Corporate Center Drive, Suite #210
		  	Raleigh, NC 27607
		  	Facsimile:	 	(919) 582 9051
		  	Attention:	 	President

 With a copy (which shall not constitute notice) to: 

 

					
		  	Ellenoff Grossman & Schole LLP
		  	150 East 42nd Street, 11th
Floor
		  	New York, NY 10017
		  	Facsimile:	 	(212) 370-7889
		  	Attention:	 	Barry I. Grossman, Esq.

 If to a
Purchaser: To the address set forth immediately below such Purchaser’s name on the signature pages hereto. Each party will provide ten days’ advance written notice to the other parties of any change in its address. 

8.7 Successors and Assigns. This Agreement is binding upon and inures to the benefit of the parties and their successors and
assigns. The Company will not assign this Agreement or any rights or obligations hereunder without the prior written consent of the Purchasers who purchased a majority of the Shares sold pursuant to this Agreement; provided, however, that no
such consent shall be required in connection with any acquisition of the Company or a majority of the outstanding shares of Common Stock or a sale of all or substantially all of the assets of the Company, in each case in a single or series of
related transactions, or in the case of any other assignment by operation of law. No Purchaser may assign this Agreement or any rights or obligations hereunder without the prior written consent of the Company, except as permitted in accordance with
Section 6.9 hereof. 
 8.8 Third Party Beneficiaries. This Agreement is intended for the benefit of the parties
hereto, their respective permitted successors and assigns and is not for the benefit of, nor may any provision hereof be enforced by, any other person. 
 8.9 Further Assurances. Each party will do and perform, or cause to be done and performed, all such further acts and things, and will execute and deliver all other agreements, certificates,
instruments and documents, as another party may reasonably request in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby. 

8.10 No Strict Construction. The language used in this Agreement is deemed to be the language chosen by the parties to express
their mutual intent, and no rules of strict construction will be applied against any party. 
 8.11 Equitable Relief. The
Company recognizes that, if it fails to perform or discharge any of its obligations under this Agreement, any remedy at law may prove to be inadequate relief to the Purchasers. The Company therefore agrees that the Purchasers are entitled to seek
temporary and permanent injunctive relief in any such case. Each Purchaser also recognizes that, if it fails to perform or discharge any of its obligations under this Agreement, any remedy at law may prove to be inadequate relief to the Company.
Each Purchaser therefore agrees that the Company is entitled to seek temporary and permanent injunctive relief in any such case. 

 8.12 Survival of Representations and Warranties. Notwithstanding any investigation
made by any party to this Agreement, all representations and warranties made by the Company and the Purchasers herein shall survive for a period of one year following the date hereof. 

8.13 Independent Nature of Purchasers’ Obligations and Rights. The obligations of each Purchaser under this Agreement 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 this Agreement. Nothing contained herein and no action taken by
any Purchaser pursuant 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,
or are deemed affiliates with respect to such obligations or the transactions contemplated by this Agreement. Each Purchaser shall be entitled to independently protect and enforce its rights, including without limitation the rights arising out of
this Agreement, and it shall not be necessary for any other Purchaser to be joined as an additional party in any proceeding for such purpose. 
 8.14 Waiver of Conflicts. Each Purchaser acknowledges that Ellenoff Grossman & Schole LLP, outside general counsel to the Company, has in the past performed and is or may now or in the
future represent one or more Purchasers or their affiliates in matters unrelated to the transactions contemplated by this Agreement (the “Financing”), including representation of such Purchasers or their affiliates in matters
of a similar nature to the Financing. The applicable rules of professional conduct require that Ellenoff Grossman & Schole LLP inform the Purchasers hereunder of this representation and obtain their consent. Ellenoff Grossman &
Schole LLP has served as outside general counsel to the Company and has negotiated the terms of the Financing solely on behalf of the Company. Each Purchaser hereby (a) acknowledges that they have had an opportunity to ask for and have obtained
information relevant to such representation, including disclosure of the reasonably foreseeable adverse consequences of such representation; (b) acknowledges that with respect to the Financing, Ellenoff Grossman & Schole LLP has
represented solely the Company, and not any Purchaser or any stockholder, director or employee of the Company or any Purchaser; and (c) gives its informed consent to Ellenoff Grossman & Schole LLP’s representation of the Company
in the Financing. 
 [Signature Page Follows] 

 IN WITNESS WHEREOF, the undersigned Purchasers and the Company have caused this
Agreement to be duly executed as of the date first above written. 
  

			
	BIODELIVERY SCIENCES INTERNATIONAL, INC.
		
	By:	 	 /s/ Mark A. Sirgo

		 	Name: Mark A. Sirgo
		 	Title: President and Chief Executive Officer

 [Signature Page to Securities Purchase Agreement] 

 PURCHASER: 
  

			
	Biomedical Value Fund, L.P.
	  

	Name of Purchaser
		
	By:	 	 /s/ David E. Kroin

		 	Name: David E. Kroin
		 	Title: Managing Director

  

			
	Address:	  	Great Point Partners, LLC
		  	165 Mason Street, 3rd Floor
		  	Greenwich, CT 06830

 Fax Number: 203-971-3320 

[Signature Page to Securities Purchase Agreement between 
 BioDelivery Sciences International, Inc., the above named Purchaser 
 and
the other parties thereto] 

			
	Biomedical Institutional Value Fund, L.P.
	  

	Name of Purchaser
		
	By:	 	 /s/ David E. Kroin

		 	Name: David E. Kroin
		 	Title: Managing Director

  

			
	Address:	  	Great Point Partners, LLC
		  	165 Mason Street, 3rd Floor
		  	Greenwich, CT 06830

 Fax Number: 203-971-3320 

[Signature Page to Securities Purchase Agreement between 
 BioDelivery Sciences International, Inc., the above named Purchaser 
 and
the other parties thereto] 

			
	Biomedical Offshore Value Fund, Ltd.
	  

	Name of Purchaser
		
	By:	 	 /s/ David E. Kroin

		 	Name: David E. Kroin
		 	Title: Managing Director

  

			
	Address:	  	Great Point Partners, LLC
		  	165 Mason Street, 3rd Floor
		  	Greenwich, CT 06830

 Fax Number: 203-971-3320 

[Signature Page to Securities Purchase Agreement between 
 BioDelivery Sciences International, Inc., the above named Purchaser 
 and
the other parties thereto] 

			
	 WS Investments III, LLC

	Name of Purchaser
		
	By:	 	 /s/ David E. Kroin

		 	Name: David E. Kroin
		 	Title: Managing Director

  

			
	Address:	  	Great Point Partners, LLC
		  	165 Mason Street, 3rd Floor
		  	Greenwich, CT 06830

 Fax Number: 203-971-3320 

  
 [Signature
Page to Securities Purchase Agreement between 
 BioDelivery Sciences International, Inc., the above named Purchaser

 and the other parties thereto] 

			
	 David J. Morrison

	Name of Purchaser
		
	By:	 	 /s/ David E. Kroin

		 	Name: David E. Kroin
		 	Title: Managing Director

  

			
	Address:	  	Great Point Partners, LLC
		  	165 Mason Street, 3rd Floor
		  	Greenwich, CT 06830

 Fax Number: 203-971-3320 

  
 [Signature
Page to Securities Purchase Agreement between 
 BioDelivery Sciences International, Inc., the above named Purchaser

 and the other parties thereto] 

			
	 Class D Series of GEF-PS, L.P.

	Name of Purchaser
		
	By:	 	 /s/ David E. Kroin

		 	Name: David E. Kroin
		 	Title: Managing Director

  

			
	Address:	  	Great Point Partners, LLC
		  	165 Mason Street, 3rd Floor
		  	Greenwich, CT 06830

 Fax Number: 203-971-3320 

  
 [Signature
Page to Securities Purchase Agreement between 
 BioDelivery Sciences International, Inc., the above named Purchaser

 and the other parties thereto] 

			
	 Lyrical Multi-Manager Fund, L.P.

	Name of Purchaser
		
	By:	 	 /s/ David E. Kroin

		 	Name: David E. Kroin
		 	Title: Managing Director

  

			
	Address:	  	Great Point Partners, LLC
		  	165 Mason Street, 3rd Floor
		  	Greenwich, CT 06830

 Fax Number: 203-971-3320 

  
 [Signature
Page to Securities Purchase Agreement between 
 BioDelivery Sciences International, Inc., the above named Purchaser

 and the other parties thereto] 

			
	 BBT Fund, L.P.

	Name of Purchaser
		
	By:	 	 /s/ J. Kenneth McCarty

		 	Vice-President of BBT-FW, Inc.
		 	General Partner of BBT Genpar, L.P.
		 	General Partner of BBT Fund, L.P.

  

			
	Address:	  	c/o BBT Genpar, L.P.
		  	201 Main Street
		  	Fort Worth, TX 76102

 Fax Number: 817-390-8896 

  
 [Signature
Page to Securities Purchase Agreement between 
 BioDelivery Sciences International, Inc., the above named Purchaser

 and the other parties thereto] 

			
	 SRI Fund, L.P.

	Name of Purchaser
		
	By:	 	 /s/ J. Kenneth McCarty

		 	Vice-President of SRI-FW, Inc.
		 	General Partner of SRI Genpar, L.P.
		 	General Partner of SRI Fund, L.P.

  

			
	Address:	  	c/o SRI Genpar, L.P.
		  	201 Main Street
		  	Fort Worth, TX 76102

 Fax Number: 817-390-8896 

			
	 CAP Fund, L.P.

	Name of Purchaser
		
	By:	 	 /s/ J. Kenneth McCarty

		 	Vice-President of CAP-FW, Inc.
		 	General Partner of CAP Genpar, L.P.
		 	General Partner of CAP Fund, L.P.

  

			
	Address:	  	c/o CAP Genpar, L.P.
		  	201 Main Street
		  	Fort Worth, TX 76102

 Fax Number: 817-390-8896 

			
	 Baker Brothers Life Sciences, L.P

	Name of Purchaser

 By: Baker Brothers Life Sciences Capital, L.P, its general partner 
 By: Baker Brothers Life
Sciences Capital (GP), LLC, its general partner 

			
		
	By:	 	 /s/ Julian Baker

		 	Name: Julian Baker
		 	Title: Managing Member

  

			
	Address:	  	667 Madison Avenue, 21st Floor
		  	New York, NY 10065

 Fax Number: (212) 521-2245

			
	 Hudson Bay Master Fund LTD

	Name of Purchaser
		
	By:	 	 /s/ Yoav Roth

		 	Name: Yoav Roth
		 	Title: Authorized Signatory

  

			
	Address:	  	120 Broadway, 40th Floor
		  	New York, NY 10271

 Fax Number: (212) 571-1279

 EXHIBIT A 
 SCHEDULE OF PURCHASERS 
  

									
	 Purchaser
	  	Shares	 	  	Aggregate 
Purchase
Price	 
	 Biomedical Value Fund, L.P.
	  	 	760,728	  	  	$	2,373,471.36	  
	 Biomedical Institutional Value Fund, L.P.
	  	 	228,962	  	  	$	714,361.44	  
	 Biomedical Offshore Value Fund, Ltd.
	  	 	569,196	  	  	$	1,775,891.52	  
	 WS Investments III, LLC
	  	 	32,616	  	  	$	101,761.92	  
	 David J. Morrison
	  	 	5,436	  	  	$	16,960.32	  
	 Class D Series of GEF-PS, L.P.
	  	 	163,081	  	  	$	508,812.72	  
	 Lyrical Multi-Manager Fund, L.P.
	  	 	163,081	  	  	$	508,812.72	  
	 BBT Fund, L.P.
	  	 	186,565	  	  	$	582,082.80	  
	 CAP Fund, L.P.
	  	 	98,994	  	  	$	308,861.28	  
	 SRI Fund, L.P.
	  	 	95,186	  	  	$	296,980.32	  
	 Baker Brothers Life Sciences, L.P
	  	 	2,403,848	  	  	$	7,500,005.76	  
	 Hudson Bay Master Fund LTD
	  	 	100,000	  	  	$	312,000.00	  
		  	 	 	 	  	 	 	 
	 Total
	  	 	4,807,693	  	  	$	15,000,002.161993 Employee Stock Purchase Plan

 Exhibit 10.5 
 DSP GROUP, INC. 
 1993 EMPLOYEE STOCK PURCHASE PLAN 

(as amended and restated effective March 2010) 
 The following constitute the provisions of the 1993 Employee Stock Purchase Plan of DSP Group, Inc. 
 1. Purpose. The purpose of the Plan is to provide employees of the Company and its Designated Subsidiaries with an opportunity to purchase Common Stock of the Company through accumulated payroll
deductions. It is the intention of the Company to have the Plan qualify as an “Employee Stock Purchase Plan” under Section 423 of the Internal Revenue Code of 1986, as amended. The provisions of the Plan, accordingly, shall be
construed so as to extend and limit participation in a manner consistent with the requirements of that section of the Code. 

2. Definitions. 
 (a) “Board” shall mean the Board of Directors of the Company. 
 (b) “Code” shall mean the Internal Revenue Code of 1986, as amended. 
 (c) “Common Stock” shall mean the Common Stock of the Company. 
 (d) “Company” shall mean DSP Group, Inc., a Delaware corporation. 
 (e) “Compensation” shall mean all base straight time gross earnings, exclusive of payments for overtime, shift premium, incentive compensation, incentive payments, bonuses, commissions
and other compensation. 
 (f) “Designated Subsidiaries” shall mean the Subsidiaries which have
been designated by the Board from time to time in its sole discretion as eligible to participate in the Plan. 

(g) “Employee” shall mean any individual who is an Employee of the Company for purposes of tax
withholding under the Code whose customary employment with the Company or any Designated Subsidiary is at least twenty (20) hours per week and more than five (5) months in any calendar year. For purposes of the Plan, the employment
relationship shall be treated as continuing intact while the individual is on sick leave or other leave of absence approved by the Company. Where the period of leave exceeds three (3) months and the individual’s right to reemployment is
not guaranteed either by statute or by contract, the employment relationship will be deemed to have terminated on the day three (3) months and one (1) day following the expiration of such three (3) month period. 

(h) “Enrollment Date” shall mean the first Trading Day of each Offering Period. 

(i) “Exercise Date” shall mean the last Trading Day of each Purchase Period. 

  
 1 

 (j) “Fair Market Value” shall mean, as of any date, the
value of Common Stock determined as follows: 
 (1) If the Common Stock is listed an any established stock
exchange or a national market system, including without limitation the National Market System of the National Association of Securities Dealers, Inc. Automated Quotation (“NASDAQ”) System, its Fair Market Value shall be the closing sale
price for the Common Stock (or the mean of the closing bid and asked prices, if no sales were reported), an quoted an such exchange (or the exchange with the greatest volume of trading in Common stock) or system on the date of such determination, as
reported in The Wall Street Journal or such other source as the Board deems reliable, or; 
 (2) If the Common
Stock is quoted on the NASDAQ system (but not on the National Market System thereof) or is regularly quoted by a recognized securities dealer but selling prices are not reported, its Fair market value shall be the mean of the closing bid and asked
prices for the Common Stock on the date of such determination, as reported in The Wall Street Journal or such other source an the Board dooms reliable, or; 

(3) In the absence of an established market for the Common Stock, the Fair Market Value thereof shall be determined in
good faith by the Board. 
 (4) For purposes of the Enrollment Date under the first Offering Period under the
Plan, the Fair Market Value of the Common Stock shall be the Price to Public as set forth in the final prospectus filed with the Securities and Exchange Commission pursuant to Rule 424 under the securities Act of 1933, as amended. 

(k) “Offering Period” shall mean the period of approximately twenty-four (24) months during which an
option granted pursuant to the Plan may be exercised, commencing on the first Trading Day on or after January 1 and July 1 of each year and terminating on the last Trading Day in the periods ending twenty-four months later, except that the
first Offering Period shall be an extended Offering Period of approximately twenty-five months, commencing with the date on which the Company’s registration statement on Form S-1 (or any successor form thereof) is declared effective by the
Securities and Exchange Commission and ending on the last Trading Day in the period ending December 31, 1995. The second Offering Period under the Plan shall commence with the first Trading Day on or after July 1, 1994. The duration of
Offering Periods may be changed pursuant to Section 4 of this Plan. 
 (l) “Plan” shall
mean this Employee Stock Purchase Plan. 
 (m) “Purchase Price” shall mean an amount equal to
85% of the Fair Market Value of a share of Common Stock on the Enrollment Date or on the Exercise Date, whichever is lower. 
 (n) “Purchase Period” shall mean the approximately six month period commencing after one Exercise Date and ending with the next Exercise Date, except that the first Purchase Period of any
Offering Period shall commence on the Enrollment Date and end with the next Exercise Date; provided, however, that the first Purchase Period of the first Offering Period under the Plan shall commence with the date on which the Company’s
registration statement on Form S-1 (or any successor form thereof) is declared effective by the Securities and Exchange Commission and end on the last Trading Day occurring in the period ending June 30, 1994. 

  
 2 

 (o) “Reserves” shall mean the number of shares of Common
Stock covered by each option under the Plan which have not yet been exercised and the number of shares of Common Stock which have been authorized for issuance under the Plan but not yet placed under option. 

(p) “Subsidiary” shall mean a corporation, domestic or foreign, of which not less than 50% of the voting
shares are held by the Company or a Subsidiary, whether or not such corporation now exists or is hereafter organized or acquired by the Company or a subsidiary. 
 (q) “Trading Day” shall mean a day on which national stock exchanges and the National Association of Securities Dealers Automated Quotation (NASDAQ) System are open for trading.

 3. Eligibility. 
 (a) Any Employee (as defined in Section 2(g)), who shall be employed by the Company on a given Enrollment Date shall be eligible to participate in the Plan. 

(b) Any Provisions of the Plan to the contrary notwithstanding, no Employee shall be granted an option under the Plan
(i) if, immediately after the grant, such Employee (or any other person whose stock would be attributed to such Employee pursuant to Section 424(d) of the Code) would own capital stock of the Company and/or hold outstanding options to
purchase such stock possessing five percent (5%) or more of the total combined voting power or value of all classes of the capital stock of the Company or of any Subsidiary, or (ii) which permits his or her rights to purchase stock under
all employee stock purchase plans of the Company and its subsidiaries to accrue at a rate which exceeds twenty-five thousand dollars ($25,000) worth of stock (determined at the fair market value of the shares at the time such option is granted) for
each calendar year in which such option is outstanding at any time. 
 4. Offering Periods. The Plan shall be implemented
by consecutive, overlapping Offering Periods with a new Offering Period commencing on the first Trading Day on or after January 1 and July 1 each year, or on such other date an the Board shall determine, and continuing thereafter until
terminated in accordance with Section 19 hereof; provided, however, that the first Offering Period under the Plan shall be an extended Offering Period of approximately twenty-five months, commencing with the first Trading Day on or after the
date on which the Company’s registration statement on Form S-1 (or any successor form thereof) is declared effective by the Securities and Exchange commission and ending on the last Trading Day in the period ending December 31, 1995. The
second Offering Period under the Plan shall commence with the first Trading Day on or after July 1, 1994. The Board shall have the power to change the duration of Offering Periods (including the commencement and termination dates thereof) with
respect to future offerings without shareholder approval if such change is announced at least fifteen (15) days prior to the scheduled beginning of the first Offering Period to be affected thereafter. 

  
 3 

 5. Participation. 

(a) An eligible Employee may become a participant in the Plan by completing a subscription agreement authorizing payroll
deductions in the form of Exhibit A to this Plan and filing it with the Company’s payroll office prior to the applicable Enrollment Date, unless a later time for filing the subscription agreement is set by the Board for all eligible Employees
with respect to a given Offering Period. 
 (b) Payroll deductions for a participant shall commence on the first
payroll following the Enrollment Date and shall end on the last payroll in the Offering Period to which such authorization is applicable, unless sooner terminated by the participant as provided in Section 10 hereof. 

6. Payroll Deductions. 
 (a) At the time a participant files his or her subscription agreement, he or she shall elect to have payroll deductions made on each pay day during the Offering Period in an amount not exceeding ten
percent (10%) of the Compensation which he or she receives on each pay day during the Offering Period, and the aggregate of such payroll deductions during the Offering Period shall not exceed ten percent (10%) of the participant’s
Compensation during said Offering Period. 
 (b) All payroll deductions made for a participant shall be credited
to his or her account under the Plan and will be credited withheld in whole percentages only. A participant may not make any additional payments into such account. 

(c) A participant may discontinue his or her participation in the Plan as provided in Section 10 hereof, or may
increase or decrease the rate of his or her payroll deductions during the Offering Period by completing or filing with the Company a new subscription agreement authorizing a change in payroll deduction rate. The Board may, in its discretion, limit
the number of participation rate changes during any Offering Period. The change in rate shall be effective with the first full payroll period following five (5) business days after the Company’s receipt of the new subscription agreement
unless the Company elects to process a given change in participation more quickly. A participant’s subscription agreement shall remain in effect for successive Offering Periods unless terminated as provided in Section 10 hereof.

 (d) Notwithstanding the foregoing, to the extent necessary to comply with Section 423 (b)(8) of the Code
and Section 3(b) hereof, a participant’s payroll deductions may be decreased to 0% at such time during any Purchase Period which is scheduled to end during the current calendar year (the “Current Purchase Period”) that the
aggregate of all payroll deductions which were previously used to purchase stock under the Plan in a prior Purchase Period which ended during that calendar year plus all payroll deductions accumulated with respect to the Current Purchase Period
equal $21,250. Payroll deductions shall recommence at the rate provided in such participant’s subscription agreement at the beginning of the first Purchase Period which is scheduled to end in the following calendar year, unless terminated by
the participant as provided in Section 10 hereof. 

  
 4 

 (e) At the time the option is exercised, in whole or in part, or at the time
some or all of the Company’s Common Stock issued under the Plan is disposed of, the participant must make adequate provision for the Company’s federal, state, or other tax withholding obligations, if any, which arise upon the exercise of
the option or the disposition of the Common Stock. At any time, the Company may, but will not be obligated to, withhold from the participant’s cooperation the amount necessary for the Company to most applicable withholding obligations,
including any withholding required to make available to the Company any tax deductions or benefits attributable to sale or early disposition of Common Stock by the Employee. 
 7. Grant of Option. On the Enrollment Date of each Offering Period, each eligible Employee participating in such Offering Period shall be granted an option to purchase on each Exercise Date during
such Offering Period (at the applicable Purchase price) up to a number of shares of the Company’s Common Stock determined by dividing such Employee’s payroll deductions accumulated prior to such Exercise Date and retained in the
Participant’s account as of the Exercise Date by the applicable purchase Price; provided that in no event shall an Employee be permitted to purchase during each Purchase period more than a number of Shares determined by dividing $25,000 by the
Fair Market Value of a share of the Company’s Common Stock on the Enrollment Date; and provided further that such purchase shall be subject to the limitations set forth in Sections 3(b) and 12 hereof. Exercise of the option shall occur as
provided in Section 8 hereof, unless the participant has withdrawn pursuant to Section 10 hereof, and shall expire on the last day of the Offering Period. 
 8. Exercise of Option. Unless a participant withdraws from the Plan as provided in Section 10 hereof, his or her option for the purchase of shares will be exercised automatically on the
Exercise Date, and the maximum number of full shares subject to option shall be purchased for such participant at the applicable Purchase Price with the accumulated payroll deductions in his or her account. No fractional shares will be purchased;
any payroll deductions accumulated in a participant’s account which are not sufficient to purchase a full share shall be retained in the participant’s account for the subsequent Purchase Period or Offering Period, subject to earlier
withdrawal by the participant as provided in Section 10 hereof. Any other monies left over in a participant’s account after the Exercise Date shall be returned to the participant. During a participant’s lifetime, a participant’s
option to purchase shares hereunder is exercisable only by him or her. 
 9. Delivery. As promptly as practicable after
each Exercise Date on which a purchase of shares occurs, the Company shall arrange the delivery to each participant, as appropriate, of a certificate representing the shares purchased upon exercise of his or her option. 

10. Withdrawal; Termination of Employment. 

(a) A participant may withdraw all but not less than all the payroll deductions credited to his or her account and not yet
used to exercise his or her option under the Plan at any time by giving written notice to the Company in the form of Exhibit B to this Plan. All of the participant’s payroll deductions credited to his or her account will be paid to such
participant promptly after receipt of notice of withdrawal and such participant’s option for the Offering Period will be automatically terminated, and no further payroll deductions for the purchase of shares will be made during the Offering
Period. If a participant withdraws from an Offering Period, payroll deductions will not resume at the beginning of the succeeding Offering Period unless the participant delivers to the Company a new subscription agreement. 

  
 5 

 (b) Upon a participant’s ceasing to be an Employee (as defined in
Section 2(g) hereof), for any reason, including by virtue of him or her having failed to remain an Employee of the Company for at least twenty (20) hours per week during an Offering Period in which the Employee is a participant, he or she
will be deemed to have elected to withdraw from the Plan and the payroll deductions credited to such participant’s account during the Offering Period but not yet used to exercise the option will be returned to such participant or, in the case
of his or her death, to the person or persons entitled thereto under Section 14 hereof, and such participant’s option will be automatically terminated. 
 11. Interest. No interest shall accrue on the payroll deductions of a participant in the Plan. 
 12. Stock. 
 (a) The maximum number of shares of the
Company’s Common Stock which shall be made available for sale under the Plan shall be 2,300,000 shares, subject to further adjustment upon changes in capitalization of the Company as provided in Section 18 hereof. If on a given Exercise
Date the number of shares with respect to which options are to be exercised exceeds the number of shares then available under the Plan, the Company shall make a pro rata allocation of the shares remaining available for purchase in as uniform a
manner as shall be practicable and as it shall determine to be equitable. 
 (b) The participant will have no
interest or voting right in shares covered by his option until such option has been exercised. 
 (c) Shares to
be delivered to a participant under the Plan will be registered in the name of the participant or in the name of the participant and his or her spouse. 
 13. Administration. 
 (a) Administrative Body. The
plan shall be administered by the Board or a committee of members of the Board appointed by the Board. The Board or its committee shall have full and exclusive discretionary authority to construe, interpret and apply the terms of the Plan, to
determine eligibility and to adjudicate all disputed claims filed under the Plan. Every finding, decision and determination made by the Board or its committee shall, to the full extent permitted by law, be final and binding upon all parties. Members
of the Board who are eligible Employees are permitted to participate in the Plan, provided that: 
 (1) Members
of the Board who are eligible to participate in the Plan may not vote on any matter affecting the administration of the Plan or the grant of any option pursuant to the Plan. 

(2) If a Committee is established to administer the Plan, no member of the Board who is eligible to participate in the
Plan may be a member of the Committee. 

  
 6 

 (b) Rule 16b-3 Limitations. Notwithstanding the
provisions of Subsection (a) of this Section 13, in the event that Rule 16b-3 promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or any successor provision (“Rule 16b-3”)
provides specific requirements for the administrators of plans of this type, the Plan shall be only administered by such a body and in such a manner as shall comply with the applicable requirements of Rule 16b-3. Unless permitted by Rule 16b-3, no
discretion concerning decisions regarding the Plan shall be afforded to any committee or person that is not “disinterested” as that term is used in Rule 16b-3. 
 14. Designation of Beneficiary. 
 (a) A participant may file
a written designation of a beneficiary who is to receive any shares and cash, if any, from the participant’s account under the Plan in the event of such participant’s death subsequent to an Exercise Date on which the option is exercised
but prior to delivery to such participant of such shares and cash. In addition, a participant may file a written designation of a beneficiary who is to receive any cash from the participant’s account under the Plan in the event of such
participant’s death prior to exercise of the option. If a participant is married and the designated beneficiary is not the spouse, spousal consent shall be required for such designation to be effective. 

(b) Such designation of beneficiary may be changed by the participant at any time by written notice. In the event of the
death of a participant and in the absence of a beneficiary validly designated under the Plan who is living at the time of such participant’s death, the Company shall deliver such shares and/or cash to the executor or administrator of the estate
of the participant, or if no such executor or administrator has been appointed (to the knowledge of the Company), the Company, in its discretion, may deliver such shares and/or cash to the spouse or to any one or more dependents or relatives of the
participant, or if no spouse, dependent or relative is known to the Company, then to such other person as the Company may designate. 
 15. Transferability. Neither payroll deductions credited to a participant’s account nor any rights with regard to the exercise of an option or to receive shares tinder the Plan may be
assigned, transferred, pledged or otherwise disposed of in any way (other than by will, the laws of descent and distribution or as provided in Section 14 hereof) by the participant. Any such attempt at assignment, transfer, pledge or other
disposition shall be without effect, except that the Company may treat such act as an election to withdraw funds from an Offering Period in accordance with Section 10 hereof. 

16. Use of Funds. All payroll deductions received or held by the Company under the Plan may be used by the Company for corporate
purpose, and the Company shall not be obligated to segregate such payroll deductions. 
 17. Reports. Individual accounts
will be maintained for each participant in the Plan. Statements of account will be given to participating Employees at least annually, which statement will set forth the amounts of payroll deductions, the Purchase Price, the number of shares
purchased and the remaining cash balance, if any. 

  
 7 

 18. Adjustments Upon Changes in Capitalization, Dissolution, Liquidation, Merger or Asset
Sale. 
 (a) Changes in Capitalization. Subject to any required action by the shareholders of the
Company, the Reserves as well as the price per share of Common Stock covered by each option under the Plan which has not yet been exercised shall be proportionately adjusted for any increase or decrease in the number of issued shares of Common Stock
resulting from a stock split, reverse stock split, stock dividend, combination or reclassification of the Common stock, or any other increase or decrease in the number of shares of Common Stock effected without receipt of consideration by the
Company, provided, however, that conversion of any convertible securities of the Company shall not be deemed to have been “effected without receipt of consideration.” Such adjustment shall be made by the Board, whose determination in that
respect shall be final, binding and conclusive. Except as expressly provided herein, no issuance by the Company of shares of stock of any class, or securities convertible into shares of stock of any class, shall affect, and no adjustment by reason
thereof shall be made with respect to, the number or price of shares of Common Stock subject to an option. 
 (b)
Dissolution or Liquidation. In the event of the proposed dissolution or liquidation of the Company, the Offering Periods will terminate immediately prior to the consummation of such proposed action, unless otherwise provided by the Board.

 (c) Merger or Asset Sale. In the event of a proposed sale of all or substantially all of the assets of
the Company, or the merger of the Company with or into another corporation, each option under the Plan shall be assumed or an equivalent option shall be substituted by such successor corporation or a parent or subsidiary of such successor
corporation, unless the Board determines, in the exercise of its sole discretion and in lieu of such assumption or substitution, to shorten the Offering Periods then in progress by setting a new Exercise Date (the “New Exercise Date”). If
the Board shortens the Offering Periods then in progress in lieu of assumption or substitution in the event of a merger or sale of assets, the Board shall notify each participant in writing, at least ten (10) business days prior to the New
Exercise Date, that the Exercise Date for his option has been changed to the New Exercise Date and that his option will be exercised automatically on the New Exercise Date, unless prior to such date he has withdrawn from the Offering Period as
provided in Section 10 hereof. For purposes of this paragraph, an option granted under the Plan shall be deemed to be assumed if, following the sale of assets or merger, the option confers the right to purchase, for each share of option stock
subject to the option immediately prior to the sale of assets or merger, the consideration (whether stock, cash or other securities or property) received in the sale of assets or merger by holders of common stock for each share of Common Stock held
on the effective date of the transaction (and if such holders were offered a choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding shares of common Stock); provided, however, that if such
consideration received in the sale of assets or merger was not solely common stock of the successor corporation or its parent (as defined in Section 424(e) of the Code), the Board may, with the consent of the successor corporation and the
participant, provide for the consideration to be received upon exercise of the option to be solely common stock of the successor corporation or its parent equal in fair market value to the per share consideration received by holders of common stock
and the sale of assets or merger. 

  
 8 

 19. Amendment or Termination. 

(a) The Board of Directors of the Company may at any time and for any reason suspend, terminate or amend the Plan. Except
as provided in Section 18 and this Section 19, no such termination may affect options previously granted, provided that the Plan or any one or more Offering Periods may be terminated by the Board (or its committee) on any Exercise Date or
by the Board (or its committee) establishing a new Exercise Date with respect to any Offering Period and/or any Purchase Period then in progress if the Board (or its committee) determines that the termination of the Plan or such one or more Offering
Periods is in the best interests of the Company and its shareholders. Except as provided in Section 18 and this Section 19, no amendment may make any change in any option theretofore granted which adversely affects the rights of any
participant without the consent of the affected participants. To the extent necessary to comply with Section 423 of the Code (or any successor rule or provision or any other applicable law or regulation), the Company shall obtain shareholder
approval in such a manner and to such a degree as so required. 
 (b) Without shareholder consent and without
regard to whether any participant rights may be considered to have been “adversely affected,” the Board (or its committee) shall be entitled to limit the frequency and/or number of changes in the amount withheld during Offering Periods,
change the length of Purchase Periods within any Offering Period, determine the length of any future Offering Period, determine whether future Offering Periods shall be consecutive or overlapping, establish the exchange ratio applicable to amounts
withheld in a currency other than U.S. dollars, establish additional terms, conditions, rules or procedures to accommodate the rules or laws of applicable non-U.S. jurisdictions, permit payroll withholding in excess of the amount designated by a
participant in order to adjust for delays or mistakes in the Company’s processing of properly completed withholding elections, establish reasonable waiting and adjustment periods and/or accounting and crediting procedures to ensure that amounts
applied toward the purchase of Common Stock for each participant properly correspond with amounts withheld from the participant’s Compensation, and establish such other limitations or procedures as the Board (or its committee) determines in its
sole discretion advisable and which are consistent with the Plan. 
 20. Notices. All notices or other communications by
a participant to the Company under or in connection with the Plan shall be deemed to have been duly given when received in the form specified by the Company at the location, or by the person, designated by the Company for the receipt thereof.

 21. Conditions Upon Issuance of Shares. Shares shall not be issued with respect to an option unless the exercise of
such option and the issuance and delivery of such shares pursuant thereto shall comply with all applicable provisions of law, domestic or foreign, including, without limitation, the Securities Act of 1933, as amended, the Securities Exchange Act of
1934, as amended, the rules and regulations promulgated thereunder, and the requirements of any stock exchange upon which the shares may then be listed, and shall be further subject to the approval of counsel for the Company with respect to such
compliance. 
 As a condition to the exercise of an option, the Company may require the person exercising such option to
represent and warrant at the time of any such exercise that the shares 

  
 9 

 
are being purchased only for investment and without any present intention to sell or distribute such shares if, in the opinion of counsel for the Company, such a representation is required by any
of the aforementioned applicable provisions of law. 
 22. Term of Plan. The Plan shall become effective upon the earlier
to occur of its adoption by the Board of Directors or its approval by the shareholders of the Company. It shall continue in effect until terminated under Section 19 hereof. 

23. Additional Restrictions of Rule 16b-3. The terms and conditions of options granted hereunder to, and the purchase of shares
by, persons subject to Section 16 of the Exchange Act shall comply with the applicable provisions of Rule 16b-3. This plan shall be deemed to contain, and such options shall contain, and the shares issued upon exercise thereof shall be subject
to, such additional conditions and restrictions as may be required by Rule 16b-3 to qualify for the maximum exemption from Section 16 of the Exchange Act with respect to Plan transactions. 

24. Automatic Transfer to Low Price Offering Period. To the extent permitted by Rule 16b-3 of the Exchange Act, if the Fair Market
Value of the Common Stock on any Exercise Date in an Offering Period is lower than the Fair Market Value of the Common Stock on the Enrollment Date of such Offering Period, then all participants in such Offering Period shall be automatically
withdrawn from such Offering Period immediately after the exercise of their option on such Exercise Date and automatically re-enrolled in the immediately following Offering Period as of the first day thereof. 

25. Plan Approval. The Plan was initially approved by the Board and the shareholders of the Company in the year 1993. Effective
January 1, 2004, the Board approved an amendment and restatement of the Plan to extend the term of the Plan, which amendment and restatement was not subject to shareholder approval. In March 28, 2006, the Board approved an amendment and
restatement of the Plan to increase the number of shares reserved for issuance under the Plan from 700,000 to 1,000,000 Shares, which amendment and restatement was subsequently approved by stockholders. In March 2008, the Board approved an amendment
and restatement of the Plan to increase the number of shares reserved for issuance under the Plan from 1,000,000 Shares to 1,500,000, which amendment and restatement was subsequently approved by stockholders. In March 2009, the Board approved an
amendment and restatement of the Plan to increase the number of shares reserved for issuance under the Plan from 1,500,000 Shares to 2,000,000, which amendment and restatement was subsequently approved by stockholders. In March 2010, the Board
approved an amendment and restatement of the Plan to increase the number of shares reserved for issuance under the Plan from 2,000,000 Shares to 2,300,000, which amendment and restatement was subsequently approved by stockholders. 

  
 10 

 EXHIBIT A 
 DSP GROUP, INC. 
 1993 EMPLOYEE STOCK PURCHASE PLAN 

SUBSCRIPTION AGREEMENT 
  

					
	________	  	Original Application	  	Enrollment Date:                     
	________	  	Change in Payroll Deduction Rate	  	
	________	  	Change of Beneficiary(ies)	  	

  

	1.	                           
                                         
                     hereby elects to Participate in the DSP Group, Inc. 1993 Employee Stock Purchase Plan (the “Employee Stock Purchase
Plan”) and subscribes to purchase shares of the Company’s Common Stock in accordance with this Subscription Agreement and the Employee Stock Purchase Plan. 

 

	2.	I hereby authorize payroll deductions from each paycheck in the amount of     % of my Compensation on each payday (not to exceed 20%) during
the Offering Period in accordance with the Employee Stock Purchase Plan. (Please note that no fractional percentages are permitted.) 

  

	3.	I understand that said payroll deductions shall be accumulated for the purchase of shares of Common Stock at the applicable Purchase Price determined in accordance with
the Employee Stock Purchase Plan. I understand that if I do not withdraw from an Offering Period, any accumulated payroll deductions will be used to automatically exercise my option. 

 

	4.	I have received a copy of the complete “DSP Group, Inc. 1993 Employee Stock Purchase Plan.” I understand that my participation in the Employee Stock Purchase
Plan is in all respects subject to the term of the Plan. I understand that the grant of the option by the Company under this Subscription Agreement is subject to obtaining shareholder approval of the Employee Stock Purchase Plan.

  

	5.	Shares purchased for me under the Employee Stock Purchase Plan should be issued in the name(s) of (Employee or Employee and spouse only):
                                         
                                         
                                         
                                     .

  

	6.	 I understand that if I dispose of any shares received by me pursuant to the Plan within 2 years after the Enrollment Date (the first day of the
Offering Period during which I purchased such shares) or one year after the Exercise Date, I will be treated for federal income tax purposes as having received ordinary income at the time of such disposition in an amount equal to the excess of the
fair market value of the shares at the time such shares were purchased over the price which I paid far the shares. I hereby agree to notify the Company in writing within 30 days after the date of any disposition of my shares and I will make
adequate provision for Federal, state or other tax withholding obligations, if any, which arise upon the disposition of the Common  

  
 1 

	 	 
Stock. The Company may, but will not be obligated to, withhold from my compensation the amount necessary to meet any applicable withholding obligation including any withholding
necessary to make available to the Company any tax deductions or benefits attributable to sale or early disposition of Common Stock by me. If I dispose of such shares at any time after the expiration of the 2-year and 1-year holding periods, I
understand that I will be treated for federal income tax purposes as having received income only at the time of such disposition, and that such income will be taxed as ordinary income only to the extent of an amount equal to the lesser of
(1) the excess of the fair market value of the shares at the time of such disposition over the purchase price which I paid for the shares, or (2) 15% of the fair market value of the shares on the first day of the Offering Period. The
remainder of the gain, if any, recognized on such disposition will be taxed as capital gain. 

  

	7.	I hereby agree to be bound by the terms of the Employee Stock Purchase Plan. The effectiveness of this Subscription Agreement is dependent upon my eligibility to
participate in the Employee Stock Purchase Plan. 

  

	8.	In the event of my death, I hereby designate the following as my beneficiary(ies) to receive all payments and shares due me under the Employee Stock Purchase Plan:

  

							
	NAME:    (Please print)	  	 	  	 	  	 
		  	(First)	  	(Middle)	  	(Last)

  

					
	  	 		 	  
	Relationship	 		 	
			
	 	 		 	  
		 		 	(Address)
			
	 Employee’s Social

Security Number:
	 		 	  
			
	Employee’s Address:	 		 	  
	 	 		 	  
	 	 		 	  

 I UNDERSTAND THAT THIS
SUBSCRIPTION AGREEMENT SHALL REMAIN IN EFFECT THROUGHOUT SUCCESSIVE OFFERING PERIODS UNLESS TERMINATED BY ME. 
  

					
	Dated:                     	 		 	  
		 		 	Signature of Employee
			
	 	 		 	  
		 		 	Spouse’s Signature (If beneficiary other than spouse)

  
 2 

 EXHIBIT B 
 DSP GROUP, INC. 
 1993 EMPLOYEE STOCK PURCHASE PLAN 

NOTICE OF WITHDRAWAL 

The undersigned participant in the Offering Period of the DSP Group, Inc. 1993 Employee Stock Purchase Plan which began on
                            ,
             (the “Enrollment Date”) hereby notifies the company that he or she hereby withdraws from the Offering Period. He or she directs the Company to pay to the
undersigned as promptly as practicable all the payroll deductions credited to his or her account with respect to such Offering Period. The undersigned understands and agrees that his or her option for such Offering Period will be automatically
terminated. The undersigned understands further that no further payroll deductions will be made for the purchase of shares in the current Offering Period and the undersigned shall be eligible to participate in succeeding Offering Periods only by
delivering to the Company a new Subscription Agreement. 
  

			
	Name and Address of Participant:
	
	 
	
	 
	
	 
	
	Signature:
	
	 
		
	Date:	 	 

  
 1

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