Document:

a03registrationrightsagr

                    REGISTRATION RIGHTS AGREEMENT         THIS REGISTRATION RIGHTS AGREEMENT (the “Agreement”) is made and entered  into as of this 14 day of September, 2018 by and among Pacific Mercantile Bancorp, a California  corporation  (the  “Company”),  and  Patriot  Financial  Partners  III,  L.P.,  a  Delaware  limited  partnership  (the  “Holder”).   Capitalized  terms  used  herein  shall  have  the  meanings  set  forth  in Section 1 below.                                    RECITALS         A.    Concurrently herewith the Holder has entered into a Stock Purchase Agreement  (the “Stock Purchase Agreement”) with the Company and Carpenter Community Bancfund, L.P.  and  Carpenter  Community  Bancfund-A,  L.P.  (collectively  referred  to  herein  as  “Carpenter”),  pursuant  to  which  Carpenter  will  be  selling  to  the  Holder,  and  the  Holder  will  be  purchasing  from  Carpenter,  1,467,155  shares  of  the  Company’s  Series  A  Preferred  Stock  and  2,169,208  shares of the Company’s Common Stock.         B.    In  connection  with  entering  into  the  Stock  Purchase  Agreement  and  consummating the transactions contemplated thereby, the Company and the Holder have entered  into an Investor Rights Agreement pursuant to which the parties have agreed to enter into this  Agreement.          NOW,  THEREFORE,   in  consideration  of  the  promises  and  the  mutual  covenants  contained  herein  and  for  other  good  and  valuable  consideration,  the  receipt  and  adequacy  of  which are hereby  acknowledged  by the  Parties,  the  Company  and  the Holder  hereby  agree  as  follows:                                   AGREEMENT   1.    DEFINITIONS. As used in this Agreement, the following terms shall have the following  meanings:         1.1.  “Affiliate” means, with respect to any Person, any other Person which directly or  indirectly controls, is controlled by, or is under common control with, such Person.         1.2.  “Blue Sky Application” shall have the meaning set forth in Section 6.1 below.         1.3.  “Business Day” means a day, other than a Saturday or Sunday, on which banks in  New York City are open for the general transaction of business.         1.4.  “Common Stock” means the Company’s common stock, no par value.         1.5.  “Effective Date” means the date on which the Registration Statement is declared  effective by the SEC.         1.6.  “Effectiveness Period” shall have the meaning set forth in Section 4.1 below.    010-8656-8769/9/AMERICAS  

 

      1.7.   “Exchange  Act” means  the Securities  Exchange  Act  of  1934,  as  amended,  and  the rules and regulations promulgated thereunder.         1.8.   “Filing Deadline” means, with respect to the Registration Statement required to  be filed pursuant to Section 2.1(a), the date that is the first (1st) anniversary of the Closing Date;  provided that if the Filing Deadline falls on a Saturday, Sunday or other day that the Commission  is closed for business, the Filing Deadline shall be extended to the next Business Day on which  the Commission is open for business.         1.9.   “Holder  Indemnified  Parties”  shall  have  the  meaning  set  forth  in Section 6.1 below.         1.10. “Inspectors” shall have the meaning set forth in Section 4.14 below.         1.11. “Non-Voting Common Stock" means the Company's non-voting common stock,  no par value per share, into which the Series A Preferred Stock is automatically convertible as of  the  close  of  business  on  the  effective  date  of  an  amendment  to  its  articles  of  incorporation  authorizing said stock following approval of such amendment by the Company’s stockholders.         1.12. “Parties” means, collectively, the Company and the Holder, and “Party” means,  individually, each of the Company and the Holder.         1.13. “Person” means an individual, corporation, partnership, limited liability company,  trust,  business  trust,  association,  joint  stock  company,  joint  venture,  sole  proprietorship,  unincorporated organization, governmental authority or any other form of entity not specifically  listed herein.         1.14. “Prospectus” shall mean the prospectus included in the Registration Statement, as  amended  or  supplemented  by  any  prospectus  supplement,  with  respect  to  the  terms  of  the  offering of any portion of the Registrable Securities covered by the Registration Statement and  by  all  other  amendments  and  supplements  to  the  prospectus,  including  post-effective  amendments and all material incorporated by reference in such prospectus.         1.15. “Records” shall have the meaning set forth in Section 4.14 below.         1.16. “Register,”  “registered”  and  “registration”  refer  to  a  registration  made  by  preparing  and  filing  a  Registration  Statement  or  similar  document  in  compliance  with  the  Securities  Act  (as  defined  below),  and  the  declaration  or  ordering  of  effectiveness  of  the  Registration Statement or document.         1.17. “Registrable Securities” means all of the Shares, the Underlying Shares and any  securities issued or issuable upon any stock split, dividend or other distribution, recapitalization  or similar event with respect to the Shares or the Underlying Shares, provided that Shares or the  Underlying  Shares  shall  cease  to  be  Registrable  Securities  upon  the  earliest  to  occur  of  the  following:  (A) a sale pursuant to a Registration Statement or Rule 144 under the Securities Act  (in which case, only such security sold shall cease to be a Registrable Security); (B) becoming  eligible  for  sale  without  time,  volume  or  manner  of  sale  restrictions  by  the  Holder  under                                        2    010-8656-8769/9/AMERICAS  

 

Rule 144; (C) if such Shares or Underlying Shares have ceased to be outstanding; or (D)  if such  Shares or Underlying Shares have been sold in a private transaction in which the Holder's rights  under this Agreement have not been assigned to the transferee.         1.18. “Registration  Statement”  shall  mean  the  registration  statement  of  the  Company  filed under the Securities Act that covers the resale of the Registrable Securities pursuant to the  provisions  of  this  Agreement,  amendments  and  supplements  to  such  Registration  Statement,  including post-effective amendments, all exhibits and all material incorporated by reference in  such Registration Statement.         1.19. “SEC” means the Securities and Exchange Commission.         1.20. “Securities Act” means the Securities Act of 1933, as amended, and the rules and  regulations promulgated thereunder.         1.21. “Series  A  Preferred  Stock”  means  the  mandatorily  convertible  noncumulative  perpetual preferred stock, Series A, no par value, having the rights, preferences and privileges set  forth  in  its  Certificate  of  Determination  of  the  Rights,  Preferences  and  Privileges  and  Restrictions.         1.22. "Shares" means the shares of Common Stock and the shares of Series A Preferred  Stock sold to the Holder pursuant to the Stock Purchase Agreement.         1.23. “Suspension” shall have the meaning set forth in Section 3.1 below.         1.24. “Suspension Notice” shall have the meaning set forth in Section 3.1 below.         1.25. “Underlying Shares” means the shares of Non-Voting Common Stock into which  the shares of Series A Preferred Stock are convertible.  2.    REGISTRATION.         2.1.  Registration Statement.               (a)   On  or  prior  to  the  Filing  Deadline,  the  Company  shall  prepare  and  file  with the SEC a Registration Statement on Form S-3 (the “Registration Statement”) covering the  resale of up to all of the Registrable Securities in 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  Securities  by  such  other  means  of  distribution  of  Registrable  Securities  as  the  Company  may  reasonably determine.  The Registration Statement also shall cover, to the extent allowable under  the  Securities  Act  and  the  rules  and  regulations  promulgated  thereunder,  such  indeterminate  number  of  additional  shares  of  Registrable  Securities  that  may  become  issuable  as  a  result  of  stock splits, dividends or other distributions, recapitalizations or other similar transactions with  respect to the Registrable Securities that occur during the Effectiveness Period.  The Registration  Statement  (and  each  amendment  or  supplement  thereto,  and  each  request  for  acceleration  of  effectiveness  thereof)  shall  be  provided  in  accordance  with Section  4 to  the  Holder  and  its  counsel prior to its filing or other submission.                                        3    010-8656-8769/9/AMERICAS  

 

            (b)   The Company represents and warrants that, as of the date hereof, it meets  the  requirements  for  the  use  of  Form  S-3  for  registration  of  the  resale  of  the  Registrable  Securities by the Holder.  The Company will file all reports required to be filed by the Company  with the SEC in a timely manner so as to preserve its eligibility for the use of Form S-3.         2.2.  Expenses.  The  Company  will  pay  all  expenses  associated  with  registration,  including  filing  and  printing  fees,  the  Company’s  counsel  and  accounting  fees  and  expenses,  costs associated with clearing the Registrable Securities for sale under applicable state securities  laws  and  listing  fees,  but  excluding  discounts,  commissions,  fees  of  underwriters,  selling  brokers,  dealer  managers  or  similar  securities  industry  professionals  with  respect  to  the  Registrable Securities being sold.         2.3.  Effectiveness.  The  Company  shall  use  commercially  reasonable  efforts  to  have  the  Registration  Statement  declared  effective  within  60  days  after  the  date  the  Registration  Statement  was  filed  with  the  SEC; provided, however,  that  the  Company  shall  be  entitled  to  delay  or  defer  the  effectiveness  of  the  Registration  Statement  if  the  Company  reasonably  believes, considering the advice of counsel, that the Company may, in the absence of a delay or  deferral, be required under state or federal securities laws to disclose any corporate development,  the disclosure of which could reasonably be expected to have a material adverse effect upon the  Company, its stockholders, a potentially material transaction or event involving the Company, or  any negotiations, discussions or proposals directly relating thereto. The Company shall notify the  Holder  by  facsimile  or  email  as  promptly  as  practicable,  and  in  any  event,  within  two  (2)  Business Days, after the Registration Statement is declared effective and shall provide the Holder  with copies of any related Prospectus to be used in connection with the sale or other disposition  of the securities covered thereby.  Notwithstanding anything to the contrary, the Company may  not delay or defer the effectiveness of the Registration Statement for a period to exceed in the  aggregate sixty (60) days.   3.    SUSPENSION.         3.1.  Subject to Section 3.2 below, in the event: (i) of any request by the SEC or any  other federal or state governmental authority, during the Effectiveness Period, for amendments or  supplements to the Registration Statement or related Prospectus or for additional information so  that the Registration Statement will not contain an untrue statement of a material fact or omit to  state a material fact required to be stated therein or necessary to make the statements therein not  misleading or otherwise fail to comply with the applicable rules and regulations of the federal  securities  laws;  (ii) of  the  issuance  by  the  SEC  or  any  other  federal  or  state  governmental  authority  of  any  stop  order  suspending  the  effectiveness  of  the  Registration  Statement  or  the  initiation  of  any  proceedings  for  that  purpose;  (iii) of  the  receipt  by  the  Company  of  any  notification with respect to the suspension of the qualification or exemption from qualification of  any of the Registrable Securities for sale in any jurisdiction or the initiation of any proceeding  for  such  purpose,  provided  that,  considering  the  advice  of  counsel,  the  Company  reasonably  believes  that  it  must  qualify  in  such  jurisdiction;  (iv) of  any  event  or  circumstance  that,  considering the advice of counsel, the Company reasonably believes necessitates the making of  any changes in the Registration Statement or related Prospectus, or any document incorporated  or  deemed  to  be  incorporated  therein  by  reference,  so  that,  in  the  case  of  the  Registration                                        4    010-8656-8769/9/AMERICAS  

 

Statement, it will not contain any untrue statement of a material fact or any omission to state a  material  fact  required  to  be  stated  therein  or  necessary  to  make  the  statements  therein  not  misleading, and that in the case of a related Prospectus, it will not contain any untrue statement  of  a  material  fact  or  any  omission  to  state  a  material  fact  required  to  be  stated  therein  or  necessary to make the statements therein, in the light of the circumstances under which they were  made,  not  misleading;  or  (v) that  the  Company reasonably believes,  considering the  advice  of  counsel, that the Company may, in the absence of a suspension described hereunder, be required  under  state or federal  securities  laws  to  disclose any  corporate  development, the  disclosure  of  which  could  reasonably  be  expected  to  have  a  material  adverse  effect  upon  the  Company,  its  stockholders,  a  potentially  material  transaction  or  event  involving  the  Company,  or  any  negotiations, discussions or proposals directly relating thereto; then the Company shall, promptly  following the occurrence of any of the foregoing events, deliver a certificate in writing to the  Holder  (the  “Suspension  Notice”)  to  the  effect  of  the  foregoing  (but  in  no  event,  without  the  prior written consent of the Holder, shall the Company disclose to the Holder any of the facts or  circumstances  regarding  any  material  nonpublic  information)  and,  upon  receipt  of  such  Suspension Notice, the Holder will refrain from selling any Registrable Securities pursuant to the  Registration Statement (a “Suspension”) until the Holder’s receipt of copies of a supplemented  or  amended  prospectus  prepared  and  filed  by  the  Company  or  until  the  Holder  is  advised  in  writing by the Company that the current Prospectus may be used and the Holder has received  copies of any additional or supplemental filings that are incorporated or deemed incorporated by  reference in any such Prospectus; provided that, in the case of a suspension due to (x) an event  described in clause (i), (ii), or (iii) of this Section 3.1, the Suspensions shall not be for more than  an  aggregate  of  ninety  (90) days  in  any  365  day  period  and  (y) an  event  described  in  clause (iv) or (v) of this Section 3.1, the Suspensions shall not be for more than an aggregate of  sixty (60) days in any 365 day period.         3.2.  The Company will use commercially reasonable efforts to terminate a Suspension  as promptly as practicable after delivery of a Suspension Notice to the Holder.   4.    COMPANY OBLIGATIONS. The Company will use commercially reasonable efforts to  effect  the  registration  of  the  Registrable  Securities  in  accordance  with  the  terms  hereof,  and  pursuant thereto the Company will, as expeditiously as possible:         4.1.  cause the Registration Statement to become effective and to remain continuously  effective  for  a  period  that  will  terminate  on  the  date  on  which  all  securities  covered  by  the  Registration Statement cease to be Registrable Securities (the “Effectiveness Period”) and advise  the Holder in writing when the Effectiveness Period has expired;         4.2.  (i)  prepare  and  file  with  the  SEC  such  amendments  and  post-effective  amendments  to  the  Registration  Statement and such supplements  to  the  Prospectus  as  may be  necessary  to  keep  the  Registration  Statement  effective  for  the  period  specified  in Section 4.1,  (ii) respond  as  promptly as  reasonably  possible  to  any  comments  received from  the  SEC  with  respect  to  each  Registration  Statement  or  any  amendment  thereto,  and  (iii) comply  with  the  provisions of the Securities Act and the Exchange Act with respect to the distribution of all of  the Registrable Securities covered thereby during the Effectiveness Period;                                         5    010-8656-8769/9/AMERICAS  

 

      4.3.  (i) provide copies to and permit counsel designated by the Holder to review the  Registration Statement and any amendments or supplements thereto and any comments made by  the staff of the SEC and the Company’s responses thereto no fewer than five (5) days prior to its  filing  with  the  SEC  or  its  receipt  from  the  SEC,  as  applicable,  and  (ii) shall  duly  consider  comments made by such counsel thereon and shall not file any Registration Statement and any  amendments   or   supplements  thereto  to   which   such   counsel  reasonably  objects; provided, however, that Holder’s counsel will be deemed to have no objections if such  counsel has not provided written comments to the Company and its counsel no later than three  (3) Business Days after  the Holder’s counsel has been provided with copies of the documents  listed  in  clause (i) of  this Section 4.3.  The  Company  shall  not  unreasonably  reject  comments  from  such  counsel  prior  to  the  Company’s  submission  of  a  request  for  acceleration  of  the  effectiveness  of  a  Registration  Statement  or  any  amendment  or  supplement  thereto.   The  Company shall reasonably cooperate with such counsel in performing the Company’s obligations  pursuant to this Section 4.3;         4.4.  furnish to the Holder and its legal counsel, without charge, (i) promptly after the  same is prepared and publicly distributed, filed with the SEC, or received by the Company (but  not later than two (2) Business Days after the filing date, receipt date or sending date, as the case  may be) one (1) copy of the Registration Statement and any amendment thereto, the preliminary  prospectus, free writing prospectus and Prospectus and each amendment or supplement thereto  (as applicable), and each letter written by or on behalf of the Company to the SEC or the staff of  the SEC, and each item of correspondence from the SEC or the staff of the SEC, relating to the  Registration  Statement  (other  than  any  portion  of  any  thereof  which  contains  information  for  which  the  Company  has  sought  confidential  treatment),  and  (ii) an  electronic  copy  of  a  Prospectus,  including  a  preliminary  prospectus  and  any  free  writing  prospectus,  and  all  amendments and supplements thereto and such other documents as counsel for the Holder may  reasonably request in connection with the disposition of such Registrable Securities owned by  the Holder that are covered by the Registration Statement;         4.5.  within  two (2) Business  Days  after  a  Registration  Statement  which  covers  Registrable Securities is declared effective by the SEC, deliver, and shall cause legal counsel for  the Company to deliver, to the transfer agent for such Registrable Securities (with copies to the  Holder whose Registrable Securities are included in such Registration Statement) confirmation  that such Registration Statement has been declared effective by the SEC in such form that the  transfer agent may reasonably request;         4.6.  use commercially reasonable efforts to (i) prevent the issuance of any stop order  or other suspension of effectiveness and, (ii) if such order is issued, obtain the withdrawal of any  such order  at  the earliest  practicable  time and to  notify  the  Holder of the  issuance of such  an  order and the resolution thereof;         4.7.  prior  to  the  Effective  Date,  use  commercially  reasonable  efforts  to  register  or  qualify  or  cooperate  with  the  Holder  and  their  counsel  in  connection  with  the  registration  or  qualification of the Registrable Securities for offer and sale by the Holder under the securities or  blue sky laws of such jurisdictions requested by the Holder, provided that, considering the advice  of  the  Company’s  counsel,  the  Company  reasonably  believes  that  it  must  qualify  in  such                                        6    010-8656-8769/9/AMERICAS  

 

jurisdiction  or  jurisdictions,  and  do  any  and  all  other  commercially  reasonable  acts  or  things  necessary  or  advisable  to  enable  the  distribution  by  the  Holder  in  such  jurisdictions  of  the  Registrable  Securities  covered  by  the  Registration  Statement; provided, however,  that  the  Company shall not be required in connection therewith or as a condition thereto to (i) qualify to  do  business  in  any  jurisdiction  where  it  would  not  otherwise  be  required  to  qualify  but  for  this Section 4.7,  (ii) subject  itself  to  general  taxation  in  any  jurisdiction  where  it  would  not  otherwise be so subject but for this Section 4.7, or (iii) file a general consent to service of process  in any such jurisdiction. The Company shall promptly notify the Holder who holds Registrable  Securities and its legal counsel of the receipt by the Company of any notification with respect to  the suspension of the registration or qualification of any of the Registrable Securities for sale by  the Holder under the securities or “blue sky” laws of any jurisdiction in the United States or its  receipt of actual notice of the initiation or threatening of any proceeding for such purpose;         4.8.  use commercially reasonable efforts to cause all shares of Common Stock covered  by  the  Registration  Statement  to  be  listed  on  each  securities  exchange,  interdealer  quotation  system  or  other  market  on  which  similar  securities  issued  by  the  Company  are  then  listed  (it  being understood that the Company has no obligation to cause any other shares of Registrable  Securities, including shares of the Series A Preferred Stock or Non-Voting Common Stock, to be  listed on any securities exchange, interdealer quotation system or other market);         4.9.  otherwise use commercially reasonable efforts to comply with all applicable rules  and  regulations  of  the  SEC  under  the  Securities  Act  and  the  Exchange  Act,  take  such  other  actions as may be reasonably necessary to facilitate the registration of the Registrable Securities  hereunder;         4.10. promptly  (and  in  any  event  within  two  (2) Business  Days  following  discovery)  notify the Holder in writing, at any time when a Prospectus relating to Registrable Securities is  required to be delivered under the Securities Act, upon discovery that, or upon the happening of  any event as a result of which, the Prospectus included in the Registration Statement, as then in  effect, includes an untrue statement of a material fact or omits to state any material fact required  to be stated therein or necessary to make the statements therein not misleading in light of the  circumstances then existing, and at the request of any the Holder, promptly prepare and furnish  to  the  Holder  a  reasonable  number  of  copies  of  a  supplement  to  or  an  amendment  of  such  Prospectus  as  may  be  necessary  so  that,  as  thereafter  delivered  to  the  purchasers  of  such  Registrable Securities, such Prospectus shall not include an untrue statement of a material fact or  omit  to state a  material fact  required to  be  stated  therein or necessary to make the statements  therein  not  misleading  in  light  of  the  circumstances  then  existing.  The  Company  shall  also  promptly  notify  the  Holder  and  its  legal  counsel  in  writing  (i) when  a  prospectus  or  any  prospectus supplement or post-effective amendment has been filed,  and  when the Registration  Statement or any post-effective amendment has become effective, (ii) of any request by the SEC  for  amendments  or  supplements  to  the  Registration  Statement  or  related Prospectus  or  related  information,  and  (iii) of  the  Company’s  reasonable  determination  of  whether  a  post-effective  amendment to the Registration Statement would be appropriate;         4.11. with  a  view  to  making  available  to  the  Holder  the  benefits  of  Rule  144  (or  its  successor  rule)  and  any  other  rule  or  regulation  of  the  SEC  that  may  at  any  time  permit  the                                        7    010-8656-8769/9/AMERICAS  

 

Holder  to  sell  shares  of  Common  Stock  to  the  public  without  registration,  the  Company  covenants  and  agrees  to:  (a) make  and  keep  public  information  available,  as  those  terms  are  understood and defined in Rule 144, during the Effectiveness Period; (b) file with the SEC in a  timely  manner  all  reports  and  other  documents  required  of  the  Company  under  the  Exchange  Act;  and  (c) furnish  to  the  Holder  upon  request,  as  long  as  the  Holder  owns  any  Registrable  Securities,  (i) a  written  statement  by  the  Company  that  it  has  complied  with  the  reporting  requirements of the Exchange Act, (ii) a copy of the Company’s most recent Annual Report on  Form  10-K  or  Quarterly  Report  on  Form  10-Q,  and  (iii) such  other  information  as  may  be  reasonably  requested  in  order  to  avail  the  Holder  of  any  rule  or  regulation  of  the  SEC  that  permits the selling of any such Registrable Securities without registration;         4.12. hold  in  confidence  and  not  make  any  disclosure  of  information  concerning  the  Holder provided to the Company unless (i) disclosure of such information is necessary to comply  with federal or state securities laws, (ii) the disclosure of such information is necessary to avoid  or  correct  a  misstatement  or  omission  in  any  Registration  Statement,  (iii) the  release  of  such  information is ordered pursuant to a subpoena or other final, non-appealable order from a court  or  governmental  body  of  competent  jurisdiction,  or  (iv) such  information  has  been  made  generally available to the public other than by disclosure in violation of this Agreement or any  other agreement of which the Company has knowledge.  The Company agrees that it shall, upon  learning that disclosure of such information concerning the Holder is sought in or by a court or  governmental body of competent jurisdiction or through other means, give prompt written notice  to the Holder and allow the Holder, at the Holder’s expense, to undertake appropriate action to  prevent disclosure of, or to obtain a protective order for, such information;         4.13. if requested by the Holder, (i) as soon as practicable incorporate in a prospectus  supplement or post-effective amendment such information as the Holder reasonably requests to  be  included  therein  relating  to  the  sale  and  distribution  of  Registrable  Securities,  including,  without  limitation,  information  with  respect  to  the  number  of  Registrable  Securities  being  offered or sold, the purchase price being paid therefor and any other terms of the offering of the  Registrable Securities to be sold in such offering; (ii) as soon as practicable make all required  filings  of  such  prospectus  supplement  or  post-effective  amendment  after  being  notified  of  the  matters  to  be  incorporated  in  such  prospectus  supplement  or  post-effective  amendment;  and  (iii) as  soon  as  practicable,  supplement  or  make  amendments  to  any  Registration  Statement  if  reasonably  requested  by  the  Holder  holding  any  Registrable  Securities  to  the  effect  of  the  foregoing;         4.14. make available for inspection by (i) the Holder, (ii) legal counsel for the Holder  and  (iii) one  firm  of  accountants  or  other  agents  retained  by  the  Holder  (collectively,  the  “Inspectors”), all  pertinent  financial and other records,  and pertinent  corporate documents  and  properties  of  the  Company  (collectively,  the  “Records”),  as  shall  be  reasonably  deemed  necessary  by  each  Inspector,  and  cause  the  Company’s  officers,  directors  and  employees  to  supply  all  information  which  any  Inspector  may  reasonably  request;  provided,  however,  that  each Inspector shall agree to hold in strict confidence and shall not make any disclosure (except  to the Holder who has agreed to receive such information and hold in strict confidence any such  information) or use of any Record or other information which the Company determines in good  faith to be confidential, and of which determination the Inspectors are so notified, unless (a) the                                        8    010-8656-8769/9/AMERICAS  

 

disclosure of such Records is necessary to avoid or correct a misstatement or omission in any  Registration Statement or is otherwise required under the Securities Act, (b) the release of such  Records  is  ordered  pursuant  to  a  final,  non-appealable  subpoena  or  order  from  a  court  or  government  body  of  competent  jurisdiction,  or  (c) the  information  in  such  Records  has  been  made generally available to the public other than by disclosure in violation of this or any other  agreement of which the Inspector has knowledge. The Holder agrees that it shall, upon learning  that disclosure of such Records is sought in or by a court or governmental body of competent  jurisdiction or through other means, give prompt notice to the Company and allow the Company,  at its expense, to undertake appropriate action to prevent disclosure of, or to obtain a protective  order  for,  the  Records  deemed  confidential.  Nothing  herein  (or  in  any  other  confidentiality  agreement between the Company and the Holder) shall be deemed to limit the Holder’ ability to  sell Registrable Securities in a manner which is otherwise consistent with applicable laws and  regulations; and         4.15. if  the  Holder  is  required  under  applicable  securities  law  to  be  described  in  the  Registration Statement as an underwriter and which is otherwise conducting diligence of the sort  that an underwriter could conduct, at the reasonable request of any the Holder, use commercially  reasonable efforts to deliver to the Holder, on the date of the effectiveness of the Registration  Statement and thereafter from time to time on such dates as the Holder may reasonably request  (i) a  letter,  dated  such  date,  from  the  Company’s  independent  certified  public  accountants  in  form  and  substance  as  is  customarily  given  by  independent  certified  public  accountants  to  underwriters  in  an  underwritten  public  offering,  addressed  to  the  Holder,  and  (ii) an  opinion,  dated as of such date, of counsel representing the Company  for purposes of such Registration  Statement,  in  form,  scope  and  substance  as  is  customarily  given  in  an  underwritten  public  offering, addressed to the Holder.   5.    OBLIGATIONS OF HOLDER.         5.1.  The Holder shall furnish in writing to the Company such information regarding  itself,  the  Registrable  Securities  held  by  it  and  the  intended  method  of  disposition  of  the  Registrable Securities held by it, as shall be required to effect the registration of such Registrable  Securities  and  shall  execute  such  documents  in  connection  with  such  registration  as  the  Company may reasonably request. At least five (5) Business Days prior to the anticipated filing  date of the Registration Statement, the Company shall notify the Holder of the information the  Company requires from the Holder. The Holder shall provide such information to the Company  at least two (2) Business Days prior to the anticipated filing date of the Registration Statement.         5.2.  The Holder agrees to cooperate with the Company as reasonably requested by the  Company in connection with the preparation and filing of a Registration Statement hereunder.         5.3.  The  Holder  agrees  that,  upon  receipt  of  any  notice  from  the  Company  of  the  commencement  of  a  Suspension  pursuant  to Section 3,  it  will  immediately  discontinue  disposition of Registrable  Securities  pursuant  to the Registration Statement, until the Holder’s  receipt of the supplemented or amended prospectus filed with the SEC and until any related post- effective  amendment  is  declared  effective  or  until  the  Holder  is  advised  in  writing  by  the  Company  that the  current  Prospectus  may be  used  and  the  Holder has  received  copies  of  any                                         9    010-8656-8769/9/AMERICAS  

 

additional or supplemental filings that are incorporated or deemed incorporated by reference in  any such Prospectus and, if so directed by the Company, the Holder shall deliver to the Company  (at  the  expense  of  the  Company)  or  destroy  (and  deliver  to  the  Company  a  certificate  of  destruction)  all  copies  in  the  Holder’s  possession  of  the  Prospectus  covering  the  Registrable  Securities current at the time of receipt of such notice.   6.    INDEMNIFICATION.         6.1.  Indemnification  by  the  Company.  The  Company  agrees  to  indemnify  and  hold  harmless, to the fullest extent permitted by law, the Holder and its directors, officers, employees,  general  partners,  members,  stockholder  and  each  Person  who  controls  the  Holder  (within  the  meaning  of  the  Securities  Act)  (collectively,  the  “Holder  Indemnified  Parties”)  against  any  losses, claims, damages, liabilities and expense (including reasonable attorneys’ fees) resulting  from or which arise out of or are based upon: (i) any untrue statement or alleged untrue statement  of a material fact or any omission or alleged omission of a material fact required to be stated in  the Registration Statement or Prospectus or preliminary prospectus or free writing prospectus or  amendment or supplement thereto; (ii) any blue sky application or other document executed by  the Company specifically for that purpose or based upon written information furnished by the  Company filed in any state or other jurisdiction in order to qualify any or all of the Registrable  Securities  under  the  securities  laws  thereof  (any  such  application,  document  or  information  herein called a “Blue Sky Application”); (iii) the omission or alleged omission to state therein a  material  fact  required  to  be  stated  therein  or  necessary  to  make  the  statements  therein  not  misleading;  (iv) any  violation  by  the  Company  or  its  agents  of  any  rule  or  regulation  promulgated  under  the  Securities  Act  applicable  to  the  Company  or  its  agents  and  relating  to  action or inaction required of the Company in connection with such registration; (v) any failure  to register or qualify the resale of the Registrable Securities included in any such registration in  any state where the Company or its agents has affirmatively undertaken or agreed in writing that  the Company will undertake such registration or qualification on the Holder’s behalf, or (vi) any  breach of this Agreement by the Company, and will reimburse the Holder Indemnified Parties  for any legal and other expenses reasonably incurred as such expenses are reasonably incurred by  the  Holder  Indemnified  Party  in  connection  with  investigating,  defending,  settling,  compromising  or  paying  any  such  loss,  claim,  damage,  liability,  expense  or  action; provided, however,  that  the  Company  will  not  be  liable  in  any  such  case  if  and  to  the  extent  that  any  such  loss,  claim,  damage  or  liability  arises  out  of  or  is  based  upon  an  untrue  statement or alleged untrue statement or omission or alleged omission based upon information  furnished  by  the  Holder  in  writing  specifically  for  use  in  the  Registration  Statement  or  Prospectus or preliminary prospectus or free writing prospectus. The Company shall notify the  Holder promptly of the institution, threat or assertion of any proceeding of which the Company is  aware in connection with the transactions contemplated by this Agreement.         6.2.  Indemnification  by  the  Holder.  The  Holder  agrees,  severally  but  not  jointly,  to  indemnify and hold harmless, to the fullest extent permitted by law, the Company, its directors,  officers,  employees,  stockholders  and  each  Person  who  controls  the  Company  (within  the  meaning  of  the  Securities  Act)  against  any  losses,  claims,  damages,  liabilities  and  expense  (including reasonable attorneys’ fees) resulting from or which arise out of or are based upon any  untrue  statement  or  alleged  untrue  statement  of  a  material  fact  or  any  omission  or  alleged                                        10    010-8656-8769/9/AMERICAS  

 

omission of a material fact required to be stated in the Registration Statement or Prospectus or  preliminary  prospectus  or  free  writing  prospectus  or  amendment  or  supplement  thereto  or  necessary to make the statements therein not misleading, to the extent, but only to the extent that  such  untrue  statement  or  omission  or  alleged  statement  or  omission  is  contained  in  any  information furnished in writing by the Holder to the Company specifically for inclusion in the  Registration  Statement  or  Prospectus  or  free  writing  prospectus  or  amendment  or  supplement  thereto, and will reimburse the Company and its directors, officers, employees, stockholders or  controlling Persons for any legal and other expenses reasonably incurred as such expenses are  reasonably  incurred  by  such  Person  in  connection  with  investigating,  defending,  settling,  compromising or paying any such loss, claim, damage, liability, expense or action. In no event  shall  the  liability  of  the  Holder  be  greater  in  amount  than  the  dollar  amount  of  the  proceeds  received by the Holder upon the sale of the Registrable Securities included in the Registration  Statement giving rise to such indemnification obligation, except in the case of fraud or willful  misconduct.         6.3.  Conduct of Indemnification Proceedings. Any Person entitled to indemnification  hereunder  shall  (i) give  prompt  notice  to  the  indemnifying  party  of  any  claim  with  respect  to  which it seeks indemnification and (ii) permit such indemnifying party to assume the defense of  such  claim  with  counsel  reasonably  satisfactory  to  the  indemnified  party;  provided  that  any  Person entitled to indemnification hereunder shall have the right to employ separate counsel and  to participate in the defense of such claim, but the fees and expenses of such counsel shall be at  the  expense  of  such  Person  unless  (a) the  indemnifying  party  has  agreed  to  pay  such  fees  or  expenses,  or (b) the indemnifying  party  shall  have failed to  assume  the  defense of such claim  within  five (5) Business  Days  after  written  notice  thereof  and  employ  counsel  reasonably  satisfactory to such Person or (c) in the reasonable judgment of any such Person, considering the  advice of counsel, a conflict of interest exists between such Person and the indemnifying party  with  respect  to  such  claims  (in  which  case,  if  the  Person  notifies  the  indemnifying  party  in  writing that such Person elects to employ separate counsel at the expense of the indemnifying  party, the indemnifying party shall not have the right to  assume the defense of such claim on  behalf of such Person); 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 hereunder,  except  to  the  extent  that  such  failure  to  give  notice  shall  materially  adversely  affect  the  indemnifying  party  in  the  defense  of  any  such  claim  or  litigation.  It  is  understood  that  the  indemnifying  party  shall  not,  in  connection  with  any  proceeding  in  the  same  jurisdiction,  be  liable for fees or expenses of more than one additional firm of attorneys at any time for all such  indemnified  parties.  No  indemnifying  party  will,  except  with  the  consent  of  the  indemnified  party, consent to entry of any judgment or enter into any settlement that 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 of such claim or litigation.         6.4.  Contribution.  If  for  any  reason  the  indemnification  provided  for  in Sections  6.1 or 6.2 is  unavailable  to  an  indemnified  party  or  insufficient  to  hold  it  harmless  as  contemplated therein, then the indemnifying party shall contribute to the amount paid or payable  by the indemnified party as a result of such loss, claim, damage or liability in such proportion as  is appropriate to reflect the relative fault of the indemnified party and the indemnifying party, as  well  as  any  other  relevant  equitable  considerations.  No  Person  guilty  of  fraudulent                                        11    010-8656-8769/9/AMERICAS  

 

misrepresentation within the meaning of Section 11(f) of the Securities Act shall be entitled to  contribution from any Person not guilty of such fraudulent misrepresentation. In no event shall  the  contribution  obligation  of  the  Holder  be  greater  in  amount  than  the  dollar  amount  of  the  proceeds  received  by  it  upon  the  sale  of  the  Registrable  Securities  giving  rise  to  such  contribution obligation.   7.    MISCELLANEOUS.         7.1.  Governing Law; Consent to Jurisdiction; Waiver of Trial by Jury.               (a)   Governing Law. This Agreement shall be deemed to be made in and in all  respects shall be interpreted, construed and governed by and in accordance with the law of the  state of California.               (b)   Consent  to  Jurisdiction.  Each  Party  irrevocably  and  unconditionally  submits, for itself and its property, to the exclusive jurisdiction any state or federal court sitting  in  County  of  Orange,  State  of  California,  in  any  proceeding  arising  out  of  or  relating  to  this  Agreement or the agreements delivered in connection herewith or the transactions contemplated  hereby or thereby or for recognition or enforcement of any judgment relating thereto, and each  Party hereby irrevocably and unconditionally  (i) agrees not to commence any such proceeding  except in such courts, (ii) agrees that any claim in respect of any such action or proceeding may  be  heard  and  determined  in  such  courts,  (iii) waives,  to  the  fullest  extent  it  may  legally  and  effectively do so, any objection which it may now or hereafter have to the laying of venue of any  such proceeding, and (iv) waives, to the fullest extent permitted by applicable law, the defense of  an inconvenient forum to the maintenance of such proceeding. Each Party hereto agrees that a  final non-appealable judgment in any such action or proceeding shall be conclusive and may be  enforced  in  other  jurisdictions  by  suit  on  the  judgment  or  in  any  other  manner  provided  by  applicable law. Each Party to this Agreement irrevocably consents to service of process in the  manner provided for notices in Section 7.2. Nothing in this Agreement will affect the right of any  Party to this Agreement to serve process in any other manner permitted by applicable law.               (c)   Waiver  of  Jury  Trial.  Each  Party  acknowledges  and  agrees  that  any  controversy which may arise under this Agreement is likely to involve complicated and difficult  issues and, therefore, each such Party hereby irrevocably and unconditionally waives any right  such Party may have to a trial by jury in respect of any litigation directly or indirectly arising out  of  or  relating  in  whole  or  in  part  to  this  Agreement  or  the  transactions  contemplated  by  this  Agreement. Each Party certifies and acknowledges that (i) no representative, agent or attorney of  any other Party has represented, expressly or otherwise, that such other Party would not, in the  event of litigation, seek to enforce the foregoing waiver, (ii) each such Party understands and has  considered the implications of this waiver, (iii) each such Party makes this waiver voluntarily,  and  (iv) one  of  the  inducements  to  each  such  Party  to  enter  into  this  Agreement  by,  among  others, are the waivers and certifications contained in this Section 7.1(c).         7.2.  Notices.  Any  notice  or  other  communication  under  this  Agreement  must  be  in  writing and will be deemed given when it is delivered in person or sent by facsimile or email  (with proof of receipt at the facsimile number or email address to which it is required to be sent),                                         12    010-8656-8769/9/AMERICAS  

 

on the Business Day after the day on which it is delivered to a major nationwide delivery service  for overnight delivery, or on the fifth Business Day after the day on which it is mailed by first  class mail from within the United States, to the  following addresses (or such other  address as  may  be  specified  after  the  date  of  this  Agreement  by  the  Party  to  which  the  notice  or  communication is sent):               If to the Company:               Pacific Mercantile Bancorp              949 South Coast Drive, Suite 300              Costa Mesa, California 92626              Attn: Curt A. Christianssen              Tel: (714) 438-2500              Fax: (714) 438-1076              Email: Curt.Christianssen@pmbank.com              With a copy to:               O’Melveny & Myers LLP              610 Newport Center Drive, 17th Floor              Newport Beach, CA 92660              Attn:  J. Jay Herron and Andor Terner              Tel: (949) 823-6900              Fax: (949) 823-6994              Email: jherron@omm.com and aterner@omm.com              If to the Holder:               Patriot Financial Partners III, L.P.              2929 Arch Street, Floor 27              Philadelphia, PA 19104-2868              Attention: James F. Deutsch              Tel: (215) 399-4650              Fax: (215) 399-4686              Email: jdeutsch@patriotfp.com              With a copy to:               Squire Patton Boggs (US) LLP              201 E. Fourth St., Suite 1900              Cincinnati, OH 45202              Attn:  James J. Barresi              Tel: (513) 361-1260              Fax (513) 361-1201              Email:  james.barresi@squirepb.com                                        13    010-8656-8769/9/AMERICAS  

 

      7.3.  Entire Agreement. This Agreement and any agreements and documents executed  by  the  Parties  simultaneously  herewith,  including  the  Stock  Purchase  Agreement  and  the  Investor Rights Agreement, represent the entire understanding and agreement of the Parties with  reference  to  the  transactions  set  forth  herein  and  supersede  all  prior  understandings  and  agreements (written or oral) made by the Parties. Except as otherwise expressly provided herein,  no Person other than the Parties hereto shall have any right hereunder or be entitled to the benefit  of any provision hereof.         7.4.  Assignment;  Successors  and  Assigns.  The  rights  under  this  Agreement  may  be  assigned  (but  only  with  all  related  obligations)  by  the  Holder  to  a  transferee  of  Registrable  Securities that is an Affiliate, partner, member, limited partner, retired partner, retired member,  or stockholder of the Holder; provided that (a) prior to such transfer, the Company is furnished  with written notice stating the name and address of such transferee and identifying the securities  with respect to which such registration rights are being transferred, and (b) such transferee agrees  in writing to be bound by and subject to the terms and conditions of this Agreement.  Subject to  the foregoing, the provisions of this Agreement shall inure to the benefit of and are binding upon  the respective successors and permitted assignees of the Parties.         7.5.  Waiver  and  Amendment.  Except  with  respect  to  statutory  requirements,  and  subject to the provisions of the last sentence of  this Section, any Party hereto may by written  instrument  extend the time  for  the  performance  of any of the  obligations  or other  acts  of  any  other Party hereto and may waive (i) any inaccuracies in the representations or warranties of any  of the other Parties contained in this Agreement or in any document delivered pursuant hereto,  (ii) compliance  with  any  of  the  covenants,  undertakings  or  agreements  by  any  of  the  other  Parties, or satisfaction of any of the conditions to the waiving Party’s obligations, contained in  this Agreement or (iii) the performance (including performance to the satisfaction of a Party or  its counsel) by any of the other Parties of any  of the obligations of such other Party set forth  herein.  No  failure  or  delay  on  the  part  of  any  Party  hereto  in  exercising  any  right,  power  or  remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any  such right, power or remedy preclude any other or further exercise thereof or the exercise of any  other  right,  power  or  remedy  of  such  Party.   Except  as  otherwise  expressly  provided  in  this  Agreement, an amendment of this Agreement or the waiver or modification of any provision of  this  Agreement  will  be  effective  only  upon  the  written  consent  of  both  the  Company  and  the  Holder.         7.6.  Headings. The headings of the various sections and subsections of this Agreement  have been inserted for convenience of reference only and shall not be deemed to be part of or be  considered in connection with the interpretation or application of any of the terms or provisions  of this Agreement.         7.7.  Severability. In case any provision contained in this Agreement should be held by  a  court  of  competent  jurisdiction  to  be  invalid,  illegal  or  unenforceable  in  any  respect  in  any  jurisdiction, then, such provision shall be ineffective to the extent of such invalidity, illegality or  unenforceability,  in  such  jurisdiction  and  the  validity,  legality  and  enforceability  of  the  remaining provisions contained herein shall not in any way be affected or impaired thereby.                                         14    010-8656-8769/9/AMERICAS  

 

      7.8.  Counterparts. This Agreement may be executed in two or more counterparts, and  by the different parties hereto in separate counterparts, each of which executed counterparts, and  any photocopies and facsimile copies thereof, shall be deemed to be an original, but all of which  taken together shall constitute one and the same agreement.         7.9.  Further Assurances. Each Party hereto agrees to execute and deliver all such other  and  additional  instruments  and  documents  and  do  all  such  other  acts  and  things  as  may  be  necessary to more fully effectuate the purposes of this Agreement.                               [Signature Page Follows]                                         15    010-8656-8769/9/AMERICASExhibit 4.1

 

CASI Pharmaceuticals, Inc.

  

	Warrant Shares:  [_______________]	Issue Date: [_______________]

 

THIS COMMON STOCK PURCHASE WARRANT (the
 “Warrant”) certifies that, for value received, [__________________] (the “Holder”) is entitled,
upon the terms and subject to the limitations on exercise and the conditions hereinafter set forth, at any time on or after one
hundred eighty days following the Issue Date (the “Initial Exercise Date”) and on or prior to the close of business
on the third anniversary of the Issue Date (the “Termination Date”) but not thereafter, to subscribe for and
purchase from CASI Pharmaceuticals, Inc., a Delaware corporation (the “Company”), up to [_________] shares (subject
to adjustments as provided below) (the “Warrant Shares”) of Common Stock.

 

Section 1.         Definitions.
Capitalized terms used and not otherwise defined herein shall have the meanings set forth in that certain Securities Purchase Agreement
(the “Purchase Agreement”), dated September 11, 2018, among the Company and the purchaser signatory thereto.

 

Section 2.         Exercise.

 

(a)          Exercise
of Warrant. Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times
on or after the Initial Exercise Date and on or before the Termination Date by delivery to the Company of a duly executed facsimile
copy (or e-mail attachment) of the Notice of Exercise in the form annexed hereto (the “Notice of Exercise”).
Within the earlier of (i) two (2) Trading Days and (ii) the number of Trading Days comprising the Standard Settlement Period (as
defined in Section 2(d)(i) herein) following the date of exercise as aforesaid, the Holder shall deliver the aggregate Exercise
Price for the shares specified in the applicable Notice of Exercise by wire transfer or cashier’s check drawn on a United
States bank unless the cashless exercise procedure specified in Section 2(c) below is specified in the applicable Notice of Exercise.
No ink-original Notice of Exercise shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization)
of any Notice of Exercise form be required. Notwithstanding anything herein to the contrary, the Holder shall not be required to
physically surrender this Warrant to the Company until the Holder has purchased all of the Warrant Shares available hereunder and
the Warrant has been exercised in full, in which case, the Holder shall surrender this Warrant to the Company for cancellation
within three (3) Trading Days of the date the final Notice of Exercise is delivered to the Company. Partial exercises of this Warrant
resulting in purchases of a portion of the total number of Warrant Shares available hereunder shall have the effect of lowering
the outstanding number of Warrant Shares purchasable hereunder in an amount equal to the applicable number of Warrant Shares purchased.
The Holder and the Company shall each maintain records showing the number of Warrant Shares purchased and the date of such purchases.
The Company shall deliver any objection to any Notice of Exercise within one (1) Business Day of receipt of such notice. In the
event of any dispute or discrepancy, the records of the Holder shall be controlling and determinative in the absence of manifest
error. The Holder and any assignee, by acceptance of this Warrant, acknowledge and agree that, by reason of the provisions
of this paragraph, following the purchase of a portion of the Warrant Shares hereunder, the number of Warrant Shares available
for purchase hereunder at any given time may be less than the amount stated on the face hereof.

  

(b)          Exercise
Price. The exercise price per share of the Common Stock under this Warrant shall be $[___], subject to adjustment hereunder
(the “Exercise Price”).

 

(c)          Cashless
Exercise. If there is no effective registration statement registering, or no current prospectus available for, the issuance
of the Warrant Shares by the Holder, then this Warrant may also be exercised, in whole or in part, at such time by means of a “cashless
exercise” in which the Holder shall be entitled to receive a number of Warrant Shares equal to the quotient obtained by dividing
[(A-B) (X)] by (A), where:

 

(A) = as applicable: (i) the VWAP on the
Trading Day immediately preceding the date of the applicable Notice of Exercise if such Notice of Exercise is (1) both executed
and delivered pursuant to Section 2(a) hereof on a day that is not a Trading Day or (2) both executed and delivered pursuant to
Section 2(a) hereof on a Trading Day prior to the opening of “regular trading hours” (as defined in Rule 600(b)(64)
of Regulation NMS promulgated under the federal securities laws) on such Trading Day, (ii) at the option of the Holder, either
(y) the VWAP on the Trading Day immediately preceding the date of the applicable Notice of Exercise or (z) the Bid Price of the
Common Stock on the principal Trading Market as reported by Bloomberg L.P. as of the time of the Holder’s execution of the
applicable Notice of Exercise if such Notice of Exercise is executed during “regular trading hours” on a Trading Day
and is delivered within two (2) hours thereafter pursuant to Section 2(a) hereof or (iii) the VWAP on the date of the applicable
Notice of Exercise if the date of such Notice of Exercise is a Trading Day and such Notice of Exercise is both executed and delivered
pursuant to Section 2(a) hereof after the close of “regular trading hours” on such Trading Day;

 

      

     

    

  

(B) = the Exercise Price of this Warrant
as adjusted hereunder; and

 

(X) = the number of Warrant Shares that
would be issuable upon exercise of this Warrant in accordance with the terms of this Warrant if such exercise were by means of
a cash exercise rather than a cashless exercise.

 

If
Warrant Shares are issued in such a cashless exercise, the parties acknowledge and agree that in accordance with Section 3(a)(9)
of the Securities Act, the Warrant Shares shall take on the registered characteristics of the Warrants being exercised.  The
Company agrees not to take any position contrary to this Section 2(c).

 

“Bid Price” means, for
any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then listed or quoted
on a Trading Market, the bid price of the Common Stock for the time in question (or the nearest preceding date) on the Trading
Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30 a.m.
(New York City time) to 4:02 p.m. (New York City time)), (b)  if OTCQB or OTCQX is not a Trading Market, the volume weighted
average price of the Common Stock for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the Common
Stock is not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Common Stock are then reported in the “Pink
Sheets” published by OTC Markets Group, Inc. (or a similar organization or agency succeeding to its functions of reporting
prices), the most recent bid price per share of the Common Stock so reported, or (d) in all other cases, the fair market value
of a share of Common Stock as determined by an independent appraiser selected in good faith by the Purchasers of a majority in
interest of the Securities then outstanding and reasonably acceptable to the Company, the fees and expenses of which shall be paid
by the Company.

 

“VWAP” means, for any
date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then listed or quoted
on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest preceding date)
on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day
from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if the OTC Bulletin Board is not a Trading Market,
the volume weighted average price of the Common Stock for such date (or the nearest preceding date) on the OTC Bulletin Board,
(c) if the Common Stock is not then listed or quoted for trading on the OTC Bulletin Board and if prices for the Common Stock are
then reported in the “Pink Sheets” published by Pink OTC Markets, Inc. (or a similar organization or agency succeeding
to its functions of reporting prices), the most recent bid price per share of the Common Stock so reported, or (d) in all other
cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected in good faith by the
Holders of a majority in interest of the Securities then outstanding and reasonably acceptable to the Company, the fees and expenses
of which shall be paid by the Company.

 

(d)          Mechanics
of Exercise.

 

(i)          Delivery
of Certificates Upon Exercise. The Company shall cause the Warrant Shares purchased hereunder to be transmitted by the Transfer
Agent to the Holder by crediting the account of the Holder’s or its designee’s balance account with The Depository
Trust Company through its Deposit or Withdrawal at Custodian system (“DWAC”) if the Company is then a participant
in such system and either (A) there is an effective registration statement permitting the issuance of the Warrant Shares to or
resale of the Warrant Shares by Holder or (B) this Warrant is being exercised via cashless exercise, and otherwise by physical
delivery of a certificate, registered in the Company’s share register in the name of the Holder or its designee, for the
number of Warrant Shares to which the Holder is entitled pursuant to such exercise to the address specified by the Holder in the
Notice of Exercise by the date that is the earliest of (i) two (2) Trading Days after the delivery to the Company of the Notice
of Exercise, (ii) one (1) Trading Day after delivery of the aggregate Exercise Price to the Company and (iii) the number of Trading
Days comprising the Standard Settlement Period after the delivery to the Company of the Notice of Exercise (such date, the “Warrant
Share Delivery Date”). Upon delivery of the Notice of Exercise, the Holder shall be deemed for all corporate purposes
to have become the holder of record of the Warrant Shares with respect to which this Warrant has been exercised, irrespective of
the date of delivery of the Warrant Shares, provided that payment of the aggregate Exercise Price (other than in the case of a
cashless exercise) is received within the earlier of (i) two (2) Trading Days and (ii) the number of Trading Days comprising the
Standard Settlement Period following delivery of the Notice of Exercise. If the Company fails for any reason to deliver to the
Holder the Warrant Shares subject to a Notice of Exercise by the Warrant Share Delivery Date, the Company shall pay to the Holder,
in cash, as liquidated damages and not as a penalty, for each $1,000 of Warrant Shares subject to such exercise (based on the VWAP
of the Common Stock on the date of the applicable Notice of Exercise), $10 per Trading Day for each Trading Day after such Warrant
Share Delivery Date until such Warrant Shares are delivered or Holder rescinds such exercise. The Company agrees to maintain a
transfer agent that is a participant in the FAST program so long as this Warrant remains outstanding and exercisable. As used herein,
 “Standard Settlement Period” means the standard settlement period, expressed in a number of Trading Days, on
the Company’s primary Trading Market with respect to the Common Stock as in effect on the date of delivery of the Notice
of Exercise.

 

      

     

    

  

(ii)         Delivery
of New Warrants Upon Exercise. If this Warrant shall have been exercised in part, the Company shall, at the request of a Holder
and upon surrender of this Warrant certificate, at the time of delivery of the Warrant Shares, deliver to Holder a new Warrant
evidencing the rights of Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant shall
in all other respects be identical with this Warrant.

 

(iii)       
Rescission Rights. If the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares pursuant
to Section 2(d)(i) by the Warrant Share Delivery Date, then the Holder will have the right to rescind such exercise.

 

(iv)        Compensation
for Buy-In on Failure to Timely Deliver Warrant Shares Upon Exercise. In addition to any other rights available to the Holder,
if the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares in accordance with the provisions
of Section 2(d)(i), pursuant to an exercise on or before the Warrant Share Delivery Date, and if after such date the Holder is
required by its broker to purchase (in an open market transaction or otherwise) or the Holder’s brokerage firm otherwise
purchases, shares of Common Stock to deliver in satisfaction of a sale by the Holder of the Warrant Shares which the Holder anticipated
receiving upon such exercise (a “Buy-In”), then the Company shall (A) pay in cash to the Holder the amount,
if any, by which (x) the Holder’s total purchase price (including brokerage commissions, if any) for the shares of Common
Stock so purchased exceeds (y) the amount obtained by multiplying (1) the number of Warrant Shares that the Company was required
to deliver to the Holder in connection with the exercise at issue times (2) the price at which the sell order giving rise to such
purchase obligation was executed, and (B) at the option of the Holder, either reinstate the portion of the Warrant and equivalent
number of Warrant Shares for which such exercise was not honored (in which case such exercise shall be deemed rescinded) or deliver
to the Holder the number of shares of Common Stock that would have been issued had the Company timely complied with its exercise
and delivery obligations hereunder. Nothing herein shall limit a Holder’s right to pursue any other remedies available to
it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with
respect to the Company’s failure to timely deliver shares of Common Stock upon exercise of the Warrant as required pursuant
to the terms hereof.

   

(v)        No
Fractional Shares or Scrip. No fractional shares or scrip representing fractional shares shall be issued upon the exercise
of this Warrant. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such exercise, the
Company shall, at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction
multiplied by the Exercise Price or round up to the next whole share.

 

      

     

    

 

(vi)         Charges,
Taxes and Expenses. Issuance of Warrant Shares shall be made without charge to the Holder for any issue or transfer tax or
other incidental expense in respect of the issuance of Warrant Shares, all of which taxes and expenses shall be paid by the Company,
and such Warrant Shares shall be issued in the name of the Holder or in such name or names as may be directed by the Holder; provided, however,
that in the event Warrant Shares are to be issued in a name other than the name of the Holder, this Warrant when surrendered for
exercise shall be accompanied by an assignment form substantially in the form attached hereto duly executed by the Holder (an “Assignment
Form”) and the Company may require, as a condition thereto, the payment of a sum sufficient to reimburse it for any transfer
tax incidental thereto. The Company shall pay all Transfer Agent fees required for same-day processing of any Notice of Exercise
and all fees to the Depository Trust Company (or another established clearing corporation performing similar functions) required
for same-day electronic delivery of the Warrant Shares.

 

(vii)        Closing
of Books. The Company will not close its stockholder books or records in any manner which prevents the timely exercise of this
Warrant, pursuant to the terms hereof.

 

(e)          Holder’s
Exercise Limitations. The Company shall not effect any exercise of this Warrant, and a Holder shall not have the right to exercise
any portion of this Warrant, pursuant to Section 2 or otherwise, to the extent that after giving effect to such issuance after
exercise as set forth on the applicable Notice of Exercise, the Holder (together with the Holder’s Affiliates, and any other
Persons acting as a group together with the Holder or any of the Holder’s Affiliates (such Persons, “Attribution
Parties”)), would beneficially own in excess of the Beneficial Ownership Limitation (as defined below).  For purposes
of the foregoing sentence, the number of shares of Common Stock beneficially owned by the Holder and its Affiliates and Attribution
Parties shall include the number of shares of Common Stock issuable upon exercise of this Warrant with respect to which such determination
is being made, but shall exclude the number of shares of Common Stock which would be issuable upon (i) exercise of the remaining,
nonexercised portion of this Warrant beneficially owned by the Holder or any of its Affiliates or Attribution Parties and (ii)
exercise or conversion of the unexercised or nonconverted portion of any other securities of the Company (including, without limitation,
any other Common Stock Equivalents) subject to a limitation on conversion or exercise analogous to the limitation contained herein
beneficially owned by the Holder or any of its Affiliates or Attribution Parties.  Except as set forth in the preceding sentence,
for purposes of this Section 2(e), beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act
and the rules and regulations promulgated thereunder, it being acknowledged by the Holder that the Company is not representing
to the Holder that such calculation is in compliance with Section 13(d) of the Exchange Act and the Holder is solely responsible
for any schedules required to be filed in accordance therewith. To the extent that the limitation contained in this Section 2(e)
applies, the determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together
with any Affiliates and Attribution Parties) and of which portion of this Warrant is exercisable shall be in the sole discretion
of the Holder, and the submission of a Notice of Exercise shall be deemed to be the Holder’s determination of whether this
Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates and Attribution Parties)
and of which portion of this Warrant is exercisable, in each case subject to the Beneficial Ownership Limitation, and the Company
shall have no obligation to verify or confirm the accuracy of such determination. In addition, a determination as to any group
status as contemplated above shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations
promulgated thereunder. For purposes of this Section 2(e), in determining the number of outstanding shares of Common Stock, a Holder
may rely on the number of outstanding shares of Common Stock as reflected in (A) the Company’s most recent periodic or annual
report filed with the Commission, as the case may be, (B) a more recent public announcement by the Company or (C) a more recent
written notice by the Company or the Transfer Agent setting forth the number of shares of Common Stock outstanding.  Upon
the written or oral request of a Holder, the Company shall within one Trading Day confirm orally and in writing to the Holder the
number of shares of Common Stock then outstanding.  In any case, the number of outstanding shares of Common Stock shall be
determined after giving effect to the conversion or exercise of securities of the Company, including this Warrant, by the Holder
or its Affiliates or Attribution Parties since the date as of which such number of outstanding shares of Common Stock was reported.
The “Beneficial Ownership Limitation” shall be 4.99% of the number of shares of the Common Stock outstanding
immediately after giving effect to the issuance of shares of Common Stock issuable upon exercise of this Warrant. The Holder, upon
notice to the Company, may increase or decrease the Beneficial Ownership Limitation provisions of this Section 2(e), provided that
the Beneficial Ownership Limitation in no event exceeds 9.99% of the number of shares of the Common Stock outstanding immediately
after giving effect to the issuance of shares of Common Stock upon exercise of this Warrant held by the Holder and the provisions
of this Section 2(e) shall continue to apply. Any increase in the Beneficial Ownership Limitation will not be effective until the
61st day after such notice is delivered to the Company. The provisions of this paragraph shall be construed and implemented
in a manner otherwise than in strict conformity with the terms of this Section 2(e) to correct this paragraph (or any portion hereof)
which may be defective or inconsistent with the intended Beneficial Ownership Limitation herein contained or to make changes or
supplements necessary or desirable to properly give effect to such limitation. The limitations contained in this paragraph shall
apply to a successor holder of this Warrant.

 

      

     

    

  

Section 3.          Certain
Adjustments.

 

		(a)	Stock Dividends and Splits. If the Company, at any time while this Warrant is outstanding: (i) pays a stock dividend
or otherwise makes a distribution or distributions on shares of its Common Stock or any other equity or equity equivalent securities
payable in shares of Common Stock (which, for avoidance of doubt, shall not include any shares of Common Stock issued by the Company
upon exercise of this Warrant), (ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines
(including by way of reverse stock split) outstanding shares of Common Stock into a smaller number of shares, or (iv) issues by
reclassification of shares of the Common Stock any shares of capital stock of the Company, then in each case the Exercise Price
shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock (excluding treasury shares,
if any) outstanding immediately before such event and of which the denominator shall be the number of shares of Common Stock outstanding
immediately after such event, and the number of shares issuable upon exercise of this Warrant shall be proportionately adjusted
such that the aggregate Exercise Price of this Warrant shall remain unchanged. Any adjustment made pursuant to this Section 3(a)
shall become effective immediately after the record date for the determination of stockholders entitled to receive such dividend
or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or re-classification.

 

		(b)	Calculations. All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share,
as the case may be. For purposes of this Section 3, the number of shares of Common Stock deemed to be issued and outstanding as
of a given date shall be the sum of the number of shares of Common Stock (excluding treasury shares, if any) issued and outstanding.

 

		(c)	Notice to Holder.

 

		(i)	Adjustment to Exercise Price. Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the
Company shall promptly deliver to the Holder by facsimile or email a notice setting forth the Exercise Price after such adjustment
and any resulting adjustment to the number of Warrant Shares and setting forth a brief statement of the facts requiring such adjustment.

 

		(ii)	Notice to Allow Exercise by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever
form) on the Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common
Stock, (C) the Company shall authorize the granting to all holders of the Common Stock rights or warrants to subscribe for or purchase
any shares of capital stock of any class or of any rights, (D) the approval of any stockholders of the Company shall be required
in connection with any reclassification of the Common Stock, any consolidation or merger to which the Company is a party, any sale
or transfer of all or substantially all of the assets of the Company, or any compulsory share exchange whereby the Common Stock
is converted into other securities, cash or property, or (E) the Company shall authorize the voluntary or involuntary dissolution,
liquidation or winding up of the affairs of the Company, then, in each case, the Company shall cause to be delivered by facsimile
or email to the Holder at its last facsimile number or email address as it shall appear upon the Warrant Register of the Company,
at least 20 calendar days prior to the applicable record or effective date hereinafter specified, a notice stating (x) the date
on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants, or if a record
is not to be taken, the date as of which the holders of the Common Stock of record to be entitled to such dividend, distributions,
redemption, rights or warrants are to be determined or (y) the date on which such reclassification, consolidation, merger, sale,
transfer or share exchange is expected to become effective or close, and the date as of which it is expected that holders of the
Common Stock of record shall be entitled to exchange their shares of the Common Stock for securities, cash or other property deliverable
upon such reclassification, consolidation, merger, sale, transfer or share exchange; provided that the failure to deliver such
notice or any defect therein or in the delivery thereof shall not affect the validity of the corporate action required to be specified
in such notice. To the extent that any notice provided in this Warrant constitutes, or contains, material, non-public information
regarding the Company or any of the Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant
to a Current Report on Form 8-K. The Holder shall remain entitled to exercise this Warrant during the period commencing on the
date of such notice to the effective date of the event triggering such notice except as may otherwise be expressly set forth herein.

 

      

     

    

  

Section 4.          Transfer
of Warrant.

 

(a)          Transferability.
This Warrant and all rights hereunder are transferable, in whole or in part, upon surrender of this Warrant at the principal office
of the Company or its designated agent, together with (i) a written assignment of this Warrant substantially in the form attached
hereto duly executed by the Holder or its agent or attorney and funds sufficient to pay any transfer taxes payable upon the making
of such transfer and (ii) any other documents or certificates reasonably requested by the Company to effect such transfer. Upon
such surrender and, if required, such payment, the Company shall execute and deliver a new Warrant or Warrants in the name of the
assignee or assignees, as applicable, and in the denomination or denominations specified in such instrument of assignment, and
shall issue to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant shall promptly
be cancelled. The Warrant, if properly assigned in accordance herewith, may be exercised by a new holder for the purchase of Warrant
Shares without having a new Warrant issued.

 

(b)          New
Warrants. This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of the
Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by
the Holder or its agent or attorney. Subject to compliance with Section 4(a), as to any transfer which may be involved in such
division or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants
to be divided or combined in accordance with such notice. All Warrants issued on transfers or exchanges shall be dated the initial
issue date set forth on the first page of this Warrant and shall be identical with this Warrant except as to the number of Warrant
Shares issuable pursuant thereto.

 

(c)          Warrant
Register. The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the “Warrant
Register”), in the name of the record Holder hereof from time to time. The Company may deem and treat the registered
Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder, and
for all other purposes, absent actual notice to the contrary.

 

Section 5.          Compliance with Securities
Laws; Disposition of Warrant or Warrant Shares. Holder, by accepting this Warrant, represents to the Company that this Warrant
and the Warrant Shares to be issued upon exercise hereof are being acquired for its own account for investment purposes only and
not with a view to distribution or resale, and that Holder will not offer, sell or otherwise dispose of this Warrant or any Warrant
Shares except under circumstances that will not result in a violation of the Securities Act of 1933, as amended (the “Act”),
or any state or other securities laws. This Warrant, any Warrant subsequently issued to Holder, and all certificates representing
the Warrant Shares issued hereunder (unless registered under the Act and any applicable state or other securities law) shall be
stamped or imprinted with a legend in substantially the following form:

 

[THIS WARRANT HAS] [THE SECURITIES EVIDENCED HEREBY
HAVE] NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE OR OTHER SECURITIES LAWS AND MAY NOT BE OFFERED,
SOLD, TRANSFERRED OR ASSIGNED EXCEPT (i) PURSUANT TO REGISTRATIONS THEREOF UNDER SUCH LAWS, OR (ii) IF, IN THE OPINION OF COUNSEL
THE PROPOSED TRANSFER MAY BE EFFECTED IN COMPLIANCE WITH APPLICABLE SECURITIES LAWS WITHOUT SUCH REGISTRATIONS.

 

      

     

    

  

Section 6.          Miscellaneous.

 

(a)          No
Rights as Stockholder Until Exercise. This Warrant does not entitle the Holder to any voting rights, dividends or other rights
as a stockholder of the Company prior to the exercise hereof as set forth in Section 2.

 

(b)          Loss,
Theft, Destruction or Mutilation of Warrant. The Company covenants that upon receipt by the Company of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any stock certificate relating to the Warrant
Shares, and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of
the Warrant, shall not include the posting of any bond), and upon surrender and cancellation of such Warrant or stock certificate,
if mutilated, the Company will make and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation,
in lieu of such Warrant or stock certificate.

 

(c)          Saturdays,
Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required or
granted herein shall not be a Business Day, then, such action may be taken or such right may be exercised on the next succeeding
Business Day.

 

(d)          Authorized
Shares; Noncircumvention.

 

The Company covenants that, during the period
the Warrant is outstanding, it will reserve from its authorized and unissued Common Stock a sufficient number of shares to provide
for the issuance of the Warrant Shares upon the exercise of any purchase rights under this Warrant. The Company further covenants
that its issuance of this Warrant shall constitute full authority to its officers who are charged with the duty of issuing the
necessary Warrant Shares upon the exercise of the purchase rights under this Warrant. The Company will take all such action as
may be necessary to assure that such Warrant Shares may be issued as provided herein without violation of any applicable law or
regulation, or of any requirements of the Trading Market upon which the Common Stock may be listed. The Company covenants that
all Warrant Shares which may be issued upon the exercise of the purchase rights represented by this Warrant will, upon exercise
of the purchase rights represented by this Warrant and payment for such Warrant Shares in accordance herewith, be duly authorized,
validly issued, fully paid and nonassessable.

 

Except and to the extent as waived or consented
to by the Holder, the Company shall not by any action, including, without limitation, amending its certificate of incorporation
or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other
voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but will at all times
in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary or appropriate
to protect the rights of Holder as set forth in this Warrant against impairment. Without limiting the generality of the foregoing,
the Company will (i) not increase the par value of any Warrant Shares above the amount payable therefor upon such exercise immediately
prior to such increase in par value, (ii) take all such action as may be necessary or appropriate in order that the Company may
validly and legally issue fully paid and nonassessable Warrant Shares upon the exercise of this Warrant and (iii) use its reasonable
best efforts to obtain all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof,
as may be, necessary to enable the Company to perform its obligations under this Warrant.

 

Before taking any action which would result
in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the Exercise Price, the Company shall
obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from any public regulatory body
or bodies having jurisdiction thereof.

 

(e)          Jurisdiction.
All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be determined in accordance
with the provisions of the Purchase Agreement. 

 

      

     

    

 

(f)           Nonwaiver
and Expenses. No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall operate
as a waiver of such right or otherwise prejudice Holder’s rights, powers or remedies.

 

(g)          Notices.
Any notice, request or other document required or permitted to be given or delivered to the Holder by the Company shall be delivered
in accordance with the notice provisions of the Purchase Agreement.

 

(h)          Remedies.
The Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled
to specific performance of its rights under this Warrant. The Company agrees that monetary damages would not be adequate compensation
for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive and not to assert
the defense in any action for specific performance that a remedy at law would be adequate.

 

(i)           Successors
and Assigns. Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall inure
to the benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted assigns
of Holder. The provisions of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant and
shall be enforceable by the Holder or holder of Warrant Shares.

 

(j)           Amendment.
This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company and the Holder.

 

(k)          Severability.
Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable
law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective
to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions
of this Warrant.

 

(l)           Headings.
The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of
this Warrant.

 

[Signature Page Follows]

 

      

     

    

  

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

 

	 	CASI PHARMACEUTICALS, INC.
	 	 
	 	By:  	 
	 	 	Name:
	 	 	Title:

 

      

     

    

  

ANNEX A

 

NOTICE OF EXERCISE

 

To:      CASI PHARMACEUTICALS,
Inc.

 

(1)       The
undersigned hereby elects to purchase ________ Warrant Shares of the Company pursuant to the terms of the attached Warrant (only
if exercised in full), and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes,
if any.

 

(2)       Payment
shall take the form of (check applicable box):

 

[   ] in lawful
money of the United States; or

 

[   ] if permitted
the cancellation of such number of Warrant Shares as is necessary, in accordance with the formula set forth in subsection 2(c)
of the Warrant, to exercise this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless
exercise procedure set forth in subsection 2(c).

 

(3)       Please
issue said Warrant Shares in the name of the undersigned or in such other name as is specified below:

 

	 	 	 

 

The Warrant Shares shall be delivered to the following DWAC
Account Number:

 

	 	 	 

 

	 	 	 

 

	 	 	 

 

[SIGNATURE OF HOLDER]

 

	Name of Investing Entity:	 

 

	Signature of Authorized Signatory of Investing Entity:	 

 

	Name of Authorized Signatory:	 

 

	Title of Authorized Signatory:	 

 

	Date:	 

 

      

     

    

  

ANNEX B

 

ASSIGNMENT FORM

 

(To assign the foregoing
Warrant, execute this form and supply required information. Do not use this form to purchase shares)

 

FOR VALUE RECEIVED, the foregoing Warrant
and all rights evidenced thereby are hereby assigned to:

 

	Name:	 
	 	(Please Print)

 

	Address:	 
	 	(Please Print)

 

Phone Number:

 

Email Address:

 

	Dated: 	 	 

 

	Holder’s Signature : 	 	 

 

	Holder’s Address:

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