Document:

Exhibit

Exhibit 4(f)
DESCRIPTION OF THE REGISTRANT’S SECURITIES
REGISTERED PURSUANT TO SECTION 12 OF THE
SECURITIES EXCHANGE ACT OF 1934

PulteGroup, Inc., a Michigan corporation (the “Company”), has two classes of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”): Common Shares, $0.01 par value per share (“Common Shares”) and Series A Junior Participating Preferred Share Purchase Rights (the “Preferred Rights”). The Common Shares are listed on The New York Stock Exchange under the ticker symbol “PHM”. Computershare Trust Company, N.A. is the transfer agent and registrar for the Common Shares. Prior to the distribution date (as such term is defined below), the Preferred Rights are associated with the Common Shares, are evidenced by Common Share certificates and are transferable with and only with the underlying Common Shares. 
The following is a description of the rights of our Common Shares and Preferred Rights and related provisions of the Company’s Restated Articles of Incorporation (the “Articles”), Amended and Restated By-laws (the “By-laws”), applicable Michigan law, Certificate of Designation of Series A Junior Participating Preferred Shares (“Certificate of Designation”) and that certain Amended and Restated Section 382 Rights Agreement (as amended as of March 14, 2013, March 10, 2016 and March 7, 2019, the “Rights Plan”) by and between the Company and Computershare Trust Company, N.A., as rights agent. This description is qualified in its entirety by, and should be read in conjunction with, the Articles, the By-laws, applicable Michigan law, the Certificate of Designation and the Rights Plan.
DESCRIPTION OF COMMON SHARES
Authorized Capital Stock
The Company’s authorized capital stock consists of 500,000,000 Common Shares and 25,000,000 Preferred Shares, $0.01 par value (the “Preferred Shares”).  As of December 31, 2019, 270,235,297 Common Shares were issued and outstanding and no Preferred Shares were issued or outstanding.
Fully Paid and Nonassessable
All of the outstanding Common Shares are fully paid and nonassessable and are not subject to further calls or assessments by us. 
Voting Rights
The holders of Common Shares are entitled to one vote per share on all matters to be voted on by such holders. Holders of Common Shares are not entitled to cumulative voting rights. Other than as provided in the Articles or pursuant to applicable law and subject to the voting rights of any holders of Preferred shares, if an action is to be taken by vote of the shareholders, it shall be authorized by a majority of the votes cast by the holders of Common Shares entitled to vote on the action in all matters other than the election of directors for which the number of nominees exceeds the number of directors to be elected.
Dividends
The holders of Common Shares are entitled to receive such dividends, if any, as may be declared from time to time by the Company’s board of directors (the “Board”) in its discretion from funds legally available therefor, subject to the rights of any holders of our Preferred Shares to receive such dividends.

Right to Receive Liquidation Distributions
Upon liquidation, dissolution or winding-up, the holders of Common Shares are entitled to share ratably in any assets remaining available for distribution after the satisfaction in full of the prior rights of creditors, including holders of our indebtedness, and the aggregate liquidation preference of any Preferred Shares then outstanding.
No Preemptive or Similar Rights
Our Common Shares have no preemptive or other subscription rights, and there are no conversion rights or redemption or sinking fund provisions with respect to such Common Shares.
Preferred Shares
Our Board has authority to divide the 25,000,000 authorized Preferred Shares into series and to fix the rights and preferences of any series so established. Variations between different series may be created by the Board with respect to such matters as voting rights, rate of dividend, priority of payment, rights of accumulation, redemption or signing fund terms, preferences upon liquidation or dissolution, conversion rights and any other preferences or rights.
If we offer Preferred Shares in the future, the Board will determine the terms of such shares, including the following, where applicable:

		
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	the designation of the shares and the number of shares that constitute the series;

		
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	the dividend rate (or the method of calculating dividends), if any, on the shares of the series and the priority as to payment of dividends with respect to other classes or series of our shares of capital stock;

		
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	whether dividends will be cumulative or non-cumulative and, if cumulative, the date from which dividends on the Preferred Shares will accumulate; 

		
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	the dividend periods (or the method of calculating the dividend periods);

		
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	whether and the extent to which such Preferred Shares shall be entitled to participate in dividends with shares of any other series or class of stock;

		
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	the voting rights of the Preferred Shares, if any;

		
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	the liquidation preference and the priority as to payment of the liquidation preference with respect to other classes or series of our capital stock and any other rights of the shares of the class or series upon our liquidation, dissolution or winding-up;

		
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	whether or not the shares of the series will be convertible into or exchangeable for securities and, if so, the security into which they are convertible or exchangeable and the terms and conditions of conversion or exchange, including the conversion or exchange price or the manner of determining it;

		
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	whether or not and on what terms the shares of the series will be subject to redemption or repurchase at our option;

		
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	whether the Preferred Shares of the series will be listed on a national securities exchange or quoted on an automated quotation system;

		
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	federal income tax considerations; and

		
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	the other material terms, rights and privileges and any qualifications, limitations or restrictions of the rights or privileges of the series.

 
 
DESCRIPTION OF PREFERRED RIGHTS
Each Preferred Right entitles its holder, under the circumstances described below, to purchase from us one one-thousandth of a Series A Preferred Share (as defined below) at a purchase price of $50 per right, subject to adjustment. 

Series A Preferred Shares

Of our 25,000,000 authorized Preferred Shares, our Board has designated 500,000 shares as “Series A Junior Participating Preferred Shares” (the “Series A Preferred Shares”).
 
Ranking

The Series A Preferred Shares will rank junior to all other series of our Preferred Shares as to payment of dividends and the distribution of assets, whether or not upon our dissolution, liquidation or winding up, unless the terms of any such series provides otherwise.

Dividends
Subject to the rights of any senior-ranking shares, commencing upon the first quarterly dividend payment date after the first issuance of shares of Series A Preferred Shares, holders of our Series A Preferred Shares are entitled to receive quarterly dividends in an amount per share equal to the greater of (i) $1.00 per share or (ii) subject to certain adjustment provisions, 1000 times the aggregate per share amount of all cash dividends plus 1000 times the aggregate per share amount of all non-cash dividends or other distributions (other than a dividend payable in Common Shares or a subdivision of outstanding Common Shares (by reclassification or otherwise) (collectively, “common share adjustments”)) declared on Common Shares since the immediately preceding quarterly dividend payment date or, with respect to the first quarterly dividend payment date, since the first issuance of any shares of Series A Preferred Shares, all subject to adjustment in the event of a declaration of a common-share-dividend on our Common Shares or a subdivision or combination of our outstanding shares.
Dividends shall begin to accrue and be cumulative on outstanding Series A Preferred Shares from the quarterly dividend payment date immediately following the date of issue of such Series A Preferred Shares, unless such shares are issued prior to the record date for the first quarterly dividend payment date, in which case dividends on such shares shall begin to accrue from the date such shares are issued, or unless such shares are issued on a quarterly dividend payment date or a date after the record date for a quarterly dividend and before such quarterly dividend payment date, in either of which events such dividends will begin to accrue and be cumulative from such quarterly dividend payment date. Accrued but unpaid dividends on the Series A Preferred Shares will not bear interest.
Whenever quarterly dividends or other dividends or distributions payable on the Series A Preferred Shares are in arrears, until all such arrears, whether or not declared, have been paid in full, we may not:

		
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	declare or pay dividends on, make any other distributions on, or redeem or purchase or otherwise acquire any Common Shares or other shares ranking junior to the Series A Preferred Shares;

		
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	declare or pay dividends on or make any other distributions on any shares ranking equally with the Series A Preferred Shares, except dividends paid ratably on the Series A Preferred Shares and all such equal-ranking shares on which dividends are payable or in arrears;

		
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	redeem or purchase or otherwise acquire any shares ranking equally with the Series A Preferred Shares, except such redemption, purchase or acquisition is done in exchange for shares of our capital stock ranking junior to the Series A Preferred Shares; or

		
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	purchase or otherwise acquire any Series A Preferred Shares or any shares ranking equally with the Series A Preferred Shares, except in accordance with a purchase offer made to all holders of such shares upon such terms as our Board determines in good faith will result in fair and equitable treatment among such shares.

Voting

Holders of Series A Preferred Shares are entitled to 1000 votes per share held (subject to adjustment for common share adjustments). Except as otherwise provided by law or the Certificate of Designation, holders of Series A Preferred Shares will be entitled to vote collectively as a single class with holders of Common Shares on all matters submitted to a vote of our shareholders. In addition, at any time dividends on any Series A Preferred Shares are in arrears in an amount equal to six quarterly dividends, holders of Series A Preferred Shares and holders of our other outstanding Preferred Shares, if any, with dividends in arrears in an amount equal to six quarterly dividends, voting as a class, irrespective of series, will have the right to elect two directors to our Board. Holders of Series A Preferred Shares will cease to be entitled to participate in such election when all accrued and unpaid dividends on all outstanding Series A Preferred Shares for all previous quarterly dividend periods and for the current quarterly dividend period have been declared and paid or set apart for payment.
 
Liquidation

In the event of our liquidation, dissolution or winding up, the holders of Series A Preferred Shares shall be entitled to receive a liquidation payment in an amount per Series A Preferred Share equal to $1,000, plus all accrued and unpaid dividends and distributions on such share, whether or not declared, to the date of such payment (the “Series A Liquidation Preference”). After payment of the full amount of the Series A Liquidation Preference to which they are entitled, holders of Series A Preferred Shares shall not receive any additional distributions unless holders of our Common Shares have received an amount per share (the “Common Adjustment”) equal to the quotient obtained by dividing (i) the Series A Liquidation Preference by (ii) 1,000 (as adjusted for common share adjustments). After we have paid the full amount of the Series A Liquidation Preference and the Common Adjustment to all entitled holders, holders of Series A Preferred Shares and holders of Common Shares shall share ratably in our remaining assets. If our available assets are insufficient to pay the Series A Liquidation Preference and the liquidation preference of all other series of our Preferred Shares, if any, ranking equally with the Series A Preferred Shares, then we shall distribute our remaining assets ratably to the holders of Series A Preferred Shares and such other preferred shares in proportion to their respective liquidation preferences.
 
Redemption
The Series A Preferred Shares are not redeemable.
 
Protection Against Adverse Amendments
Our Articles of Incorporation may not be amended in any manner that would materially alter or change the powers, preferences or special rights of the Series A Preferred Shares without the affirmative vote of the holders of a majority of the outstanding Series A Preferred Shares, voting separately as a class.
 
Rights Plan
On March 18, 2010, we entered into the Rights Plan with Computershare Trust Company, N.A., as rights agent, which amended and restated that certain Section 382 Rights Agreement, dated as of March 5, 2009, as amended as of April 7, 2009 and as of September 24, 2009 (collectively, the “Original Rights Agreement”), between the Company and Computershare Trust Company, N.A., as rights agent. Our Board had previously declared a dividend 

distribution of one Preferred Right for each outstanding Common Share to shareholders of record at the close of business on March 16, 2009, pursuant to the Original Rights Agreement.

Our Board adopted the Rights Plan in an effort to protect shareholder value by attempting to protect against a possible limitation on our ability to use our net operating loss carryforwards (the “NOLs”) and certain other tax benefits to reduce potential future U.S. federal income tax obligations. If we experience an “ownership change,” as defined in Section 382 of the Code and the regulations thereunder, our ability to fully utilize the NOLs and certain other tax benefits on an annual basis will be substantially limited, and the timing of the usage of the NOLs and such other benefits could be substantially delayed, which could therefore significantly impair the value of those assets.
The Rights Plan is intended to act as a deterrent to any person or group, together with its affiliates and associates, being or becoming the beneficial owner of 4.9% or more of our (i) Common Shares, (ii) Preferred Shares (other than Preferred Shares described in Section 1504(a)(4) of the Code), and (iii) any other interest in us that would be treated as “stock” pursuant to Treasury Regulation § 1.382-2T(f)(18) (collectively, “covered securities”).
The following general summary of the Rights Plan is qualified in its entirety by reference to the Rights Plan, which is filed as an exhibit to the registration statement of which this prospectus forms a part.
The Rights. Each Preferred Right entitles its holder, under the circumstances described below, to purchase from us one one-thousandth of a Series A Preferred Share at a purchase price of $50 per Preferred Right, subject to adjustment. Our Common Shares issued while the Rights Plan is in effect will be issued with Preferred Rights attached.
Acquiring Person. Under the Rights Plan, an “acquiring person” is any person or group, who or which, together with its affiliates and associates, becomes a beneficial owner of 4.9% or more of our covered securities, other than solely as a result of (a) a reduction in the amount of our covered securities outstanding; (b) the exercise of any options, warrants, rights or similar interests (including restricted shares) granted by us to our directors, officers and employees; (c) any unilateral grant of any of our covered securities by us or (d) any issuance of our covered securities by us or any share dividend, share split or similar transaction effected by us in which all holders of our covered securities are treated equally.
A person shall be deemed to be a “beneficial owner” of, shall be deemed to have “beneficial ownership” and shall be deemed to “beneficially own” any securities which such person directly owns, or would be deemed to constructively own, pursuant to Section 382 of the Code and the regulations promulgated thereunder.
The term “acquiring person,” however, does not include:

		
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	us, any of our subsidiaries, any employee benefit plan or other compensation arrangement of ours or of any of our subsidiaries, or any entity organized, appointed or established by us or any of our subsidiaries for or pursuant to the terms of any such plan or compensation arrangement;

		
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	any exempted person (as defined below);

		
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	William J. Pulte, any spouse of William J. Pulte, any descendant of William J. Pulte or the spouse of any such descendant, the estate of any of the foregoing or any trust or other arrangement for the benefit of any of the foregoing or any charitable organization established by any of the foregoing (the “Pulte Family”);

		
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	any group which includes any member or members of the Pulte Family if a majority of the covered securities of such group are beneficially owned by a member or members of the Pulte Family;

		
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	any person or group who becomes the beneficial owner of 4.9% or more of our covered securities as a result of an exempted transaction (as defined below);

		
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	any person whom or which our Board in good faith determines has inadvertently acquired beneficial ownership of 4.9% or more of our covered securities, so long as such person promptly enters into, and delivers to us, an irrevocable commitment to divest as promptly as practicable, and thereafter divests as promptly as practicable a sufficient number of our covered securities so that such person would no longer be a beneficial owner of 4.9% or more of our covered securities; or

		
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	any affiliate, associate or stockholder of Centex Corporation, or the general partners, limited partners or members of such stockholders who would have been an acquiring person solely as a result of the execution, delivery or performance of the merger agreement between us and Centex or certain voting agreements relating to such merger until such time that such person acquires beneficial ownership of additional covered securities of ours. 

Our Board may, in its sole discretion, exempt any person or group who would otherwise be an acquiring person from being deemed an acquiring person for purposes of the Rights Plan if it determines at any time prior to the time at which the Preferred Rights are no longer redeemable that the beneficial ownership of such person or group would not jeopardize, endanger or limit (in timing or amount) the availability of our NOLs and other tax benefits. Any such person or group is an “exempted person” under the Rights Plan. Our Board, in its sole discretion, may subsequently make a contrary determination and such person would then become an acquiring person.
An “exempted transaction” is a transaction that our Board determines, in its sole discretion, is an exempted transaction and, unlike the determination of an exempted person, such determination is irrevocable.
Separation from Common Shares. Initially, the Preferred Rights will be associated with our Common Shares and evidenced by Common Share certificates, which will contain a notation incorporating the Rights Plan by reference, and will be transferable with and only with the underlying Common Shares. Subject to certain exceptions, the Preferred Rights become exercisable and trade separately from our Common Shares only upon the “distribution date,” which occurs upon the earlier of:

		
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	10 days following a public announcement that a person or group of persons has become an acquiring person or such earlier date as a majority of our Board becomes aware of the existence of an acquiring person (the “share acquisition date”) (unless, prior to the expiration of our right to redeem the Preferred Rights, such person or group is determined by our Board to be an “exempted person”; in which case the share acquisition date will be deemed not to have occurred); or

		
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	10 business days (or later date if determined by our Board prior to such time as any person or group becomes an acquiring person) following the commencement of a tender offer or exchange offer which, if consummated, would result in a person or group becoming an acquiring person.

Until the distribution date, the surrender for transfer of any of outstanding Common Shares will also constitute the transfer of the Preferred Rights associated with those shares.
As soon as practicable after the distribution date, separate certificates or book-entry statements will be mailed to holders of record of Common Shares as of the close of business on the distribution date. From and after the distribution date, the separate Preferred Rights certificates or book-entry statements alone will represent the Preferred Rights. Except as otherwise provided in the Rights Plan, only Common Shares issued prior to the distribution date will be issued with Preferred Rights.
Expiration. The Preferred Rights are not exercisable until the distribution date and, unless earlier redeemed or exchanged by us as described below, will expire upon the earliest of:
 

		
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	the close of business on June 1, 2022 (the “Expiration Date”);

		
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	the time at which the Preferred Rights are redeemed;

		
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	the time at which the Preferred Rights are exchanged;

		
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	the close of business on the effective date of the repeal of Section 382 or any successor statute if our Board determines that the Rights Plan is no longer necessary or desirable for the preservation of certain tax benefits; and

		
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	the close of business on the first day of our taxable year to which our Board determines that certain tax benefits may not be carried forward.

Effects of Triggering Event. If a person or group becomes an acquiring person (a “flip-in event”), each holder of a Preferred Right (other than any acquiring person and certain transferees of an acquiring person, whose Preferred Rights automatically become null and void) will have the right to receive, upon exercise, Common Shares having a value equal to two times the exercise price of the Preferred Right. If an insufficient number of Common Shares are available for issuance, then our Board is required to substitute cash, reduction in the exercise price, property or other securities of ours for our Common Shares. The Preferred Rights may not be exercised following a flip-in event while we have the ability to cause the Preferred Rights to be redeemed, as described below.
For example, at an exercise price of $50 per Preferred Right, each Preferred Right not owned by an acquiring person (or by certain transferees thereof) following a flip-in event would entitle its holder to purchase $100 worth of our Common Shares (or other consideration, as noted above) for $50. Assuming that our Common Shares had a per share value of $15 at that time, the holder of each valid Preferred Right would be entitled to purchase approximately 6.7 Common Shares for $50.
Exchange. At any time after there is an acquiring person and prior to the acquisition by the acquiring person of 50% or more of our outstanding Common Shares, our Board may exchange the Preferred Rights (other than Preferred Rights owned by the acquiring person and certain transferees thereof which will have become void), in whole or in part, at an exchange ratio of one Common Share, or, at its option, one one-thousandth of a Series A Preferred Share (or of a share of a class or series of our Preferred Shares having equivalent rights, preferences and privileges (“equivalent preferred shares”)), per Preferred Right (subject to adjustment).
 
Adjustments. The exercise price payable, and the number of Preferred Shares or other securities or property issuable, upon exercise of the Preferred Rights are subject to adjustment from time to time to prevent dilution:
With certain exceptions, no adjustment in the exercise price will be required until cumulative adjustments amount to at least 1% of the exercise price. No fractional Series A Preferred Shares will be issued, and, in lieu thereof, an adjustment in cash will be made based on the market price of the Series A Preferred Shares on the last trading day prior to the date of exercise.

Redemption. In general, we may redeem the Preferred Rights in whole, but not in part, at a price of $0.001 per Preferred Right (subject to adjustment and payable in cash, Common Shares or other consideration deemed appropriate by our Board) at any time until the earlier of (i) ten days following the share acquisition date and (ii) the Expiration Date. Immediately upon the action of our Board authorizing any redemption, the Preferred Rights will terminate, and the only right of the holders of Preferred Rights will be to receive the redemption price.
Shareholder Rights; Tax Effects. Until a Preferred Right is exercised, its holder will have no rights as our shareholder, including, without limitation, the right to vote, the right to receive dividends or liquidation rights. Similarly, the Preferred Rights are not convertible and no preemptive rights or sinking fund provisions apply to the Preferred Rights. While the distribution of the Preferred Rights will not result in the recognition of taxable income by us or our shareholders, shareholders may, depending upon the circumstances, recognize taxable income after a flip-in event.
Amendment. The terms of the Preferred Rights may be amended by our Board without the consent of the holders of the Preferred Rights, including, without limitation, to extend the Expiration Date of the Rights Plan and to increase 

or decrease the purchase price. Once there is an acquiring person, however, no amendment can adversely affect the interests of the holders of the Preferred Rights.

Transfer Restrictions
Our By-laws contain certain restrictions on the direct or indirect transfer of (i) Common Shares, (ii) Preferred Shares (other than Preferred Shares described in Section 1504(a)(4) of the Internal Revenue Code of 1986, as amended (the “Code”)), (iii) warrants, rights or options (including options within the meaning of Sections 1.382-2T(h)(4)(v) and 1.382-4 of the regulations promulgated under the Code by the United States Department of the Treasury (“Treasury Regulations”)) to purchase our securities and (iv) any interest in us that would be treated as “stock” pursuant to Treasury Regulation § 1.382-2T(f)(18). The restrictions are designed to prohibit any such transfers that could limit or impair our ability to use our net operating loss carryforwards, capital loss forwards, general business credit carryforwards, alternative minimum tax credit forwards, foreign tax credit carryforwards, and similar tax benefits (collectively, the “tax benefits”).
Specifically, subject to certain limited exceptions, the transfer restrictions prohibit any such transfers (including the creation or grant of an option) to the extent that, as a result of such transfer (or any series of transfers of which such transfer is a part), either (i) any person or group of persons would become the owner of 4.9% or more of our outstanding Common Shares, whether directly or indirectly, or (ii) the percentage ownership of an existing 4.9%-or-more holder of our outstanding Common Shares would increase. For purposes of the transfer restrictions, a person’s ownership of Common Shares is regarded as including shares such person would be deemed to constructively own or which otherwise would be aggregated with shares owned by such person under Section 382 of the Code, and the Treasury Regulations thereunder.
The transfer restrictions will remain in effect until (i) the repeal of Section 382 of the Code or any successor law if our Board determines that the transfer restrictions are no longer necessary for the preservation of the tax benefits, (ii) the beginning of a taxable year of ours to which Board determines that no tax benefits may be carried forward or (iii) such date as our Board shall fix as the expiration date of the transfer restrictions.
The transferee of any such prohibited transfer will not be recognized as our shareholder for any purpose whatsoever in respect of the shares which are the subject of the prohibited transfer (such shares, the “excess shares”). Until the excess shares are acquired by another person in a transfer that is not prohibited, the purported transferee will not be entitled with respect to such excess shares to any rights as our shareholder, including the right to vote such excess shares and to receive dividends or distributions, whether liquidating or otherwise, in respect of such excess shares, if any, and the excess shares will be deemed to remain with the transferor unless and until the excess shares are transferred in a manner permitted under our By-laws.
As a condition to the registration of the transfer of any shares, any person who is a beneficial, legal or record holder of any shares, and any proposed transferee and any person controlling, controlled by or under common control with the proposed transferee, shall provide such information as we may request from time to time to determine compliance with these transfer restrictions or the status of our tax benefits.
 
Depositary Shares
We may elect to offer fractional Preferred Shares rather than full shares. If so, we will issue “depositary receipts” for these “depositary shares.” Each depositary share will represent a fraction of a share of a particular series of Preferred Shares. If we offer depositary shares pursuant to these provisions in the future, the applicable prospectus supplement will describe the terms of the depository shares and the underlying Preferred Shares to which the depositary shares relate.
Voting Rights
Our Articles require, in addition to any vote required by law, the affirmative vote of the holders of at least 69.3% of the shares voting at a meeting of shareholders in connection with (a) any merger or consolidation of the Company or 

any subsidiary with any “Interested Shareholder,” as defined therein, or any corporation which is, or after the merger or consolidation would be, an “Affiliate,” as defined therein, of an Interested Shareholder that was an Interested Shareholder prior to the transaction; (b) certain transfers to any Interested Shareholder or Affiliate of an Interested Shareholder, other than the Company or any of our subsidiaries, of any of our assets or any subsidiary which have an aggregate book value of 10% or more of consolidated net worth; (c) certain transfers by us or any subsidiary of “Equity Securities,” as defined therein, of the Company or any subsidiary which have an aggregate market value of 5% or more of the total market value of our outstanding shares to any Interested Shareholder or Affiliate of an Interested Shareholder, other than us or our subsidiaries (subject to certain exceptions); (d) the adoption of any plan or proposal for our liquidation or dissolution proposed by or on behalf of an Interested Shareholder or any Affiliate of an Interested Shareholder; (e) any reclassification of securities or recapitalization of the Company, or any merger, consolidation or share exchange by us with any of our subsidiaries which has the effect of increasing the proportionate amount of the outstanding shares of any class of our Equity Securities or Equity Securities of any subsidiary which is directly or indirectly owned by an Interested Shareholder or any Affiliate of an Interested Shareholder (each of the Transactions referred to in clauses (a) through (e), a “Business Combination”); or (f) any agreement, contract or arrangement providing for one or more of the foregoing. An “Interested Shareholder” generally includes any beneficial owner of 10% or more of the voting power of the Company or any Affiliate of ours that at any time within the two year period prior to the date in question was the beneficial owner of 10% or more of the voting power of the Company.

The foregoing supermajority vote is not required if (i) the Board approves such Business Combination and either the Interested Shareholder has been an Interested Shareholder continuously for at least two years prior to the date of the Board approval or such proposed transaction was approved by the Board prior to the time the Interested Shareholder became an Interested Shareholder or (ii) a majority of the outstanding stock of such other corporation is owned by us or our subsidiaries.
The foregoing supermajority provisions may only be amended by the affirmative vote of 69.3% of the shares voting on the proposed amendment at a meeting of shareholders, in addition to any vote otherwise required by law.
Certain Anti-Takeover Effects and Provisions of our Articles and By-laws
Number of Directors; Filing Vacancies; Removal 
Our Charter provides that the number of directors will be between three and fifteen directors and our Board will fix the exact number of directors to comprise our Board. A director may only be removed by vote of the holders of a majority of the shares entitled to vote at an election of directors. Additionally, any vacancy on the Board may only be filled by a majority of the remaining directors then in office, whether or not less than a quorum, or by a sole remaining director. These provisions have the effect of making it difficult for a potential acquirer to gain control of our Board. 
Special Meetings
Our By-laws provide that special meetings may be called only by the Board, our President or our Secretary, or by such persons upon a request in writing signed by a majority of the Board or by the holders of not less than twenty percent of the capital stock of the Company issued and outstanding and entitled to vote thereat. This provision may delay consideration of a shareholder proposal until the Company’s next annual meeting unless a special meeting is called pursuant to our By-laws. 
Proxy Access and Advance Notice of Shareholder Nominations 
Our By-laws have proxy access and advance notice procedures for shareholders to make nominations of candidates for election as directors. No business other than that stated in the notice for such meeting shall be transacted at any meeting without the unanimous consent of all the shareholder entitled to vote thereat. Our By-laws govern shareholder nominations of candidates for election as directors except with respect to the rights of holders of our Preferred Shares. 

Under our By-laws, any shareholder entitled to vote in the election of directors may nominate one or more persons for election as directors at a meeting if written notice or notice by electronic transmission of such shareholder’s intent to make such nomination or nominations has been given, either by personal delivery or by United States mail, postage prepaid, to the Corporate Secretary of the Company not later than 60 days in advance of such meeting (except that, if public disclosure of the meeting is made less than 70 days prior to the meeting, the notice need only be received within 10 days following such public disclosure). Each such notice must be accompanied by a written consent of each proposed nominee to being named in the proxy statement as a nominee and to serving as a director if elected, together with a written representation that such person currently intends to serve as a director for the term for which he or she is standing for election and must set forth: 
(i) as to each person whom the shareholder proposes to nominate for election as a director: (1) the name, age, business address and residence address of the person; (2) the principal occupation or employment of the person; (3) the class and number of common shares of the Company which are owned beneficially or of record by such person; and (4) any other information relating to the person that would be required to be disclosed in solicitations of proxies for election of directors, or is otherwise required, pursuant to Section 14 of the Exchange Act; and 
(ii) as to the shareholder giving the notice: (1) the name and address, as they appear on the Company’s books, of such shareholder and the name and address of the beneficial owner, if any, on whose behalf the nomination is made; (2) the class and number of Common Shares which are owned beneficially or of record by such shareholder or such beneficial owner on the date of such shareholder’s notice; (3) whether and the extent to which any hedging or other similar transaction, agreement, arrangement or understanding has been entered into by or on behalf of such shareholder or beneficial owner with respect to any Common Share; (4) a description of all arrangements or understandings between such shareholder or such beneficial owner and each proposed nominee and any other person or persons (including their names) pursuant to which the nomination(s) are to be made by such shareholder; (5) a representation that such shareholder intends to appear in person or by proxy at the annual meeting to nominate the persons named in its notice; and (6) any other information relating to such shareholder or such beneficial owner that would be required to be disclosed in a proxy statement or other filings required to be made in connection with solicitations of proxies for election of directors pursuant to Section 14 of the Exchange Act.
In addition and pursuant our By-laws, a shareholder, or group of up to 20 shareholders, that has owned continuously for at least three years Common Shares representing an aggregate of at least 3% of the Company’s outstanding Common Shares, may nominate and include in the Company’s proxy materials director nominees constituting up to 20% of the Company’s Board of Directors, provided that the shareholder(s) and nominee(s) satisfy the requirements in the By-laws. A notice of such nomination must be provided to the Secretary of the Company not less than one hundred twenty nor more than one hundred fifty days in advance of the date which is the anniversary of the date the Company’s proxy statement was released to security holders in connection with the previous year’s annual meeting, except where information or documents are required to be provided after the date the notice is first submitted, as set forth in the By-laws, or, if the date of the applicable annual meeting has been changed by more than thirty days from the date contemplated at the time of the previous year’s proxy statement, not less than ninety days before the date of the applicable annual meeting, or, if later, the tenth day following the day on which notice of the date of the annual meeting was mailed or public disclosure of the date of the annual meeting, whichever occurs first, and in no event shall the adjournment or postponement of an annual meeting, or the announcement thereof, commence a new time period (or extend any time period) for the giving of the notice. In addition, the Company may solicit against a shareholder nominee included in the proxy statement and, in certain circumstances, may omit a nominee from its proxy statement. 
The nominating notice must provide certain information specified in the By-laws, including, without limitation: 

		
	•
	documentary evidence verifying and certifying that, the nominating shareholder owns, and has continuously owned for the preceding three years, the minimum number of shares required, and the nominating shareholder’s agreement to provide documentary evidence verifying and certifying the nominating shareholder’s continuous ownership of the minimum number of shares through the record date;

		
	•
	an undertaking to provide immediate notice if the nominating shareholder ceases to own the minimum number of shares prior to the date of the annual meeting;

		
	•
	a copy of the Schedule 14N (or any successor form) relating to the shareholder nominee, completed and filed with the Securities and Exchange Commission by the nominating shareholder as applicable, in accordance with Securities and Exchange Commission rules;

		
	•
	the written consent of each shareholder nominee to being named in the Company’s proxy statement, form of proxy and ballot as a nominee and to serving as a director if elected;

		
	•
	a written notice of the nomination of such shareholder nominee that includes additional information, agreements, representations and warranties by the nominating shareholder or each member of a nominating group;

		
	•
	an executed agreement pursuant to which the nominating shareholder or each member of a nominating group agrees to a number of specified covenants and other provisions; 

		
	•
	an executed questionnaire provided by the Company’s Secretary upon request, which must be submitted within ten days of the nominating shareholder’s first submission of the nomination notice; and 

		
	•
	an executed agreement, which must be submitted within ten days of the nominating shareholder’s first submission of the nomination notice, by the shareholder nominee with respect to certain representations, warranties and covenants. 

 
Certain Provisions of the Michigan Business Corporation Act
Chapter 7A of the Michigan Business Corporation Act (“MBCA”) may affect attempts to acquire control of the Company. Pursuant to our Articles of Incorporation, we have expressly elected not to be subject to the provisions of Chapter 7A of the MBCA; however, the Board may terminate this election in whole or in part by action of the majority of directors then in office. Chapter 7A applies to “Business Combinations,” defined to include, among other transactions, certain mergers, substantial sales of assets or securities and recapitalizations between covered Michigan business corporations or their subsidiaries and an “Interested Shareholder” (generally a beneficial owner of 10% or more of the voting power of the Company’s outstanding voting stock). In general, Chapter 7A requires, for any Business Combination, an advisory statement from the Board, the approval of holders of at least 90% of each class of the shares entitled to vote and the approval of holders of at least two-thirds of such voting shares not held by the Interested Shareholder, its affiliates and associates. These requirements do not apply, however, where the Interested Shareholder satisfies certain “fair price,” form of consideration and other requirements and at least five years have elapsed after the person involved became an Interested Shareholder. Our Board has the power to elect to be subject to Chapter 7A as to specifically identified or unidentified Interested Shareholders.EX-10.1

 Exhibit 10.1 

EXECUTION VERSION 

INVESTMENT AGREEMENT 

This INVESTMENT AGREEMENT (this “Agreement”), dated as of January 30, 2020, is made by and between Spero Therapeutics,
Inc., a Delaware corporation (the “Company”), and each purchaser identified on the signature pages hereto (each, including its permitted successors and assigns, an “Investor” and collectively, the
“Investors”). 
 WHEREAS, the Company proposes to conduct a rights offering by distributing, at no charge, non-transferable rights (the “Rights”) to purchase shares of the Company’s Common Stock, par value $0.001 per share (the “Common Stock”), and shares of the Company’s
Series C Convertible Preferred Stock, par value $0.001 per share, having the rights, preferences and privileges as set forth in the Certificate of Designation attached hereto as Exhibit A (the “Preferred Stock”), to each
holder of record of shares of the Common Stock, the Company’s Series A Convertible Preferred Stock, par value $0.001 per share (the “Series A Preferred Stock”), and the Company’s Series B Convertible Preferred Stock, par
value $0.001 per share (the “Series B Preferred Stock”), as of the close of business on February 10, 2020 (the “Record Date”); 

WHEREAS, the Rights will be exercisable for a number of shares of Common Stock and/or shares of Preferred Stock resulting in gross proceeds to
the Company of approximately thirty million dollars ($30,000,000) (the “Offered Shares”); 
 WHEREAS, following the
distribution of the Rights, the Company will commence an offering (the “Rights Offering”) registered under the Securities Act of 1933, as amended (the “Securities Act”), pursuant to which each Right will
entitle the holder thereof to (a) for each share of Common Stock held by such holder on the Record Date, purchase a fraction of a share of Common Stock at a subscription price of $9.00 per whole share of Common Stock and/or if, as a result of
such exercise of such holder’s Right to purchase shares of Common Stock, such holder, together with its affiliates, would beneficially own more than 9.99% of the total number of shares of Common Stock then issued and outstanding immediately
after the issuance of such shares of Common Stock, to instead purchase a number of shares of Preferred Stock (at a subscription price of $9,000 per whole share of Preferred Stock (the “Preferred Exercise Price”)) equal, on an as-converted basis, to the excess portion of the Common Stock that cannot be purchased by such holder due to the foregoing beneficial ownership limitation and (b) for each share of Series A Preferred Stock or
Series B Preferred Stock held by such holder on the Record Date, purchase a fraction of a share of Preferred Stock at a subscription price equal to the Preferred Exercise Price; 

WHEREAS, in order to facilitate the Rights Offering, the Investors have agreed to purchase, at the Preferred Exercise Price, upon expiration
of the Rights Offering, shares of Preferred Stock having an aggregate value equal to the value of all of the Offered Shares that are not purchased pursuant to the exercise of Rights (including any exercise of Rights by the Investors) in the Rights
Offering (the “Backstop Shares” or the “Preferred Shares”), upon the terms and subject to the conditions set forth herein (the “Backstop Commitment”); and 

 WHEREAS, the Board of Directors of the Company has approved the Rights Offering, the terms
of the Preferred Stock, including the Preferred Exercise Price, this Agreement, the Backstop Commitment and the other transactions contemplated hereby. 

NOW, THEREFORE, in consideration of the mutual promises, agreements, representations, warranties and covenants contained herein, each of the
parties hereto hereby agrees as follows: 
 1.    Conduct of Rights Offering 

(a)    As soon as practicable after the date hereof, the Company shall publicly announce its plans to conduct the Rights
Offering, including disclosing the Record Date, the material terms of the Rights Offering, the anticipated closing date of the Rights Offering and the Investors’ purchase commitment hereunder. 

(b)    The Company shall use commercially reasonable efforts to: (i) initiate the Rights Offering, on the terms set
forth above, within five business days after the Record Date, and (ii) close the Rights Offering by no later than 5:00 p.m. (Eastern Time) on March 2, 2020. 

2.    Purchase and Sale of Securities. 

(a)    Subject to Section 2(b), each Investor, severally but not jointly, hereby agrees to purchase a number of
shares of Preferred Stock with an aggregate value equal to the amount set forth on such Investor’s signature page hereto (the “Purchase Commitment”). 

(b)    Upon the completion of the Rights Offering, the Purchase Commitment shall be adjusted for each Investor as follows:

  

	 	(i)	 first, the Purchase Commitment shall be offset, on a dollar-for-dollar basis, by the value of Offered Shares that such Investor may elect to purchase in the Rights Offering (such remaining amount (if any) being the “Adjusted Purchase
Commitment”); if such Investor purchases Offered Shares in the Rights Offering with a value that equals or exceeds such Investor’s Purchase Commitment, then its Adjusted Purchase Commitment shall be zero; and 

 

	 	(ii)	 second, the Adjusted Purchase Commitment shall be multiplied by a fraction, the numerator of which shall be the
total value of Offered Shares remaining unsold after the expiration of the Rights Offering (the “Expiration Time”), and the denominator of which shall be the aggregate value of all Adjusted Purchase Commitments for all Investors
(such product being the “Final Purchase Commitment”). 

  
 2 

 (c)    As soon as practicable, and in any event within three business
days after the Expiration Time, the Company will give each Investor a notice (a “Purchase Notice”) of: (i) the aggregate amount of Offered Shares purchased by holders of Rights pursuant to validly exercised Rights in the Rights
Offering and (ii) the value of such Investor’s Final Purchase Commitment, as well as the number of Backstop Shares (if any) to be purchased hereunder by such Investor. If there are no Backstop Shares to be purchased hereunder, the Company
shall provide the Investors with notice of this fact (a “Satisfaction Notice”). The date of transmission of a Purchase Notice or a Satisfaction Notice is referred to herein as the “Determination Date”. 

(d)    On the Closing Date (as defined below), and on the terms and subject to the conditions in this Agreement, the
Investors shall purchase from the Company, and the Company shall issue and sell to the Investors, at the Preferred Exercise Price, all of the Backstop Shares (if any), calculated in accordance with Section 2(b). 

(e)    The closing of the Rights Offering and the purchase of Backstop Shares by the Investors hereunder (the
“Closing”) will occur as soon as practicable following the Expiration Time and after giving effect to the determinations contemplated by Section 2(b) above (the “Closing Date”). The Company and, to the extent
applicable, the Investors, shall use commercially reasonable efforts to cause the Closing Date to occur within five business days following the Expiration Time. 

3.    Representations and Warranties of the Company. The Company represents and warrants to the Investors as set forth below.
Except for representations and warranties that are expressly limited as to their date, each representation and warranty is made as of the date hereof and as of the Closing Date, after giving effect to the transactions contemplated hereby: 

(a)    Organization and Qualification. Each of the Company and its Subsidiaries (as defined below) has been duly
organized and is validly existing and in good standing under the laws of its respective jurisdiction of incorporation or organization, with the requisite power and authority to own its properties and conduct its business as currently conducted. Each
of the Company and its Subsidiaries has been duly qualified as a foreign corporation or organization for the transaction of business and is in good standing under the laws of each other jurisdiction in which it owns or leases properties or conducts
any business so as to require such qualification, except to the extent that the failure to be so qualified or be in good standing has not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.
For the purpose of this Agreement, “Material Adverse Effect” means any act, development, event or occurrence which reasonably would be expected to have a material adverse effect on: (a) the enforceability of this Agreement,
(b) the results of operations, business, properties or financial condition of the Company and its Subsidiaries, taken as a whole, or (c) the Company’s ability to perform in any material respect on a timely basis its obligations under
this Agreement to be performed as of the date of determination, other than any such change, effect, event or circumstance, including, without limitation, any change in the stock price or trading volume of the Common Stock, that resulted directly or
indirectly from (i) any change in the United States or foreign economies or securities or financial markets in general that does not have a disproportionate effect on the Company and its Subsidiaries, taken as a whole, (ii) any

  
 3 

 
change that generally affects the industry in which the Company and its Subsidiaries operate that does not have a disproportionate effect on the Company and its Subsidiaries, taken as a whole,
(iii) any change arising in connection with natural disasters, hostilities, acts of war, sabotage or terrorism or military actions or any escalation or material worsening of any such natural disasters, hostilities, acts of war, sabotage or
terrorism or military actions existing as of the date hereof, (iv) any action taken by the Investors, any of their respective affiliates or their respective permitted successors and assigns with respect to the Rights Offering or the
transactions contemplated by this Agreement, (v) the effect of any changes in applicable laws or accounting rules that does not have a disproportionate effect on the Company and its Subsidiaries, taken as a whole, and (vi) any change
resulting from the announcement or pendency of the Rights Offering or compliance with the terms of this Agreement or the consummation of the Rights Offering or the transactions contemplated by this Agreement. For the purposes of this Agreement, a
“Subsidiary” of any person means, with respect to such person, any corporation, partnership or other legal entity of which such person (either alone or through or together with any other subsidiary), owns, directly or indirectly,
more than 50% of the stock or other equity interests, has the power to elect a majority of the board of directors or similar governing body, or has the power to direct the business and policies. 

(b)    Corporate Power and Authority. The Company has the requisite corporate power and authority to enter into,
execute and deliver this Agreement, and to perform its obligations hereunder and consummate the transactions contemplated hereby, including the issuance of the Preferred Shares and the shares of Common Stock issuable upon conversion thereof (the
“Conversion Shares” and together with the Preferred Shares, the “Securities”). The Company has taken all necessary corporate action required for the due authorization, execution, delivery and performance by it of
this Agreement and the conduct of the Rights Offering, including the issuance of the Preferred Shares and the Conversion Shares. 

(c)    Execution and Delivery; Enforceability. This Agreement has been, or prior to its execution and delivery at
the Closing, will be, duly and validly executed and delivered by the Company, and each such document constitutes, or will constitute, the valid and binding obligation of the Company, enforceable against the Company in accordance with its terms
subject to: (i) bankruptcy, insolvency, moratorium and other similar laws now or hereafter in effect relating to or affecting creditors’ rights generally, and (ii) general principles of equity (regardless of whether considered in a
proceeding at law or in equity). 
 (d)    Authorized and Issued Capital Stock. The authorized capital stock of
the Company, immediately prior to the Closing Date, will consist of 60,000,000 shares of Common Stock, par value $0.001 per share and 10,000,000 shares of preferred stock, par value $0.001 per share, 2,220 shares of which have been designated as
Series A Preferred Stock, 1,000 shares of which have been designated as Series B Preferred Stock and 3,333 shares of which will have been designated as Series C Preferred Stock. As of the close of business on January 28, 2020 (the
“Capital Structure Date”), (i) 19,241,995 shares of Common Stock were issued and outstanding, (ii) 1,720 shares of Series A Preferred Stock were issued and outstanding, (iii) 1,000 shares of Series B Preferred stock were issued
and outstanding, and (iv) a total of 2,965,806 shares of Common Stock were potentially issuable upon the exercise or conversion of options, 

  
 4 

 
warrants and other convertible securities issued by the Company or pursuant to stockholder-approved equity incentive plans. Except as set forth in the preceding sentence, there were no other
shares of capital stock issued and outstanding or securities convertible into or exchangeable for shares of capital stock of the Company, in each case as of the Capital Structure Date. Since the Capital Structure Date, the Company has not issued any
capital stock or securities exchangeable or convertible into capital stock of the Company, other than pursuant to stockholder-approved equity incentive plans (including upon the exercise of stock options outstanding as of the Capital Structure
Date). 
 (e)    Issuance. The Preferred Shares to be issued and sold by the Company hereunder, when such
Preferred Shares are issued and delivered against payment therefor in accordance with the terms hereof, will be duly and validly authorized, fully paid and non-assessable, free and clear of all taxes, liens,
preemptive rights, rights of first refusal, subscription and similar rights. The Conversion Shares to be issued upon conversion of the Preferred Shares will be, when issued upon conversion of the Preferred Shares in accordance with the Certificate
of Designation, duly and validly authorized, fully paid and non-assessable, free and clear of all taxes, liens, preemptive rights, rights of first refusal, subscription and similar rights. 

(f)    No Conflict. The execution and delivery by the Company of this Agreement and compliance by the Company with
all of the provisions hereof and the consummation of the transactions contemplated herein (including issuance and sale of Preferred Shares and the issuance of the Conversion Shares upon conversion of the Preferred Shares): (i) will not conflict
with, or result in a breach or violation of, any of the terms or provisions of, or constitute a default under (with or without notice or lapse of time, or both), or result in the acceleration of, any agreement or instrument to which the Company or
any of its Subsidiaries is a party or by which the Company or any of its Subsidiaries is bound or to which any of the property or assets of the Company or any of its Subsidiaries is subject, (ii) will not result in any violation of the
provisions of the certificate of incorporation or by-laws or comparable organizational documents of the Company or any of its Subsidiaries, and (iii) will not result in any violation of, or any
termination or impairment of any rights under, any law, rule or regulation, any license, authorization, injunction, judgment, order, decree, rule or regulation of any court or governmental agency or body having jurisdiction over the Company or any
of its Subsidiaries or any of their properties; except in the case of the foregoing clauses (i) and (iii) for any such breach, violation, termination or impairment that would not reasonably be expected, individually or in the aggregate, to
result in a Material Adverse Effect. To the actual knowledge of the Company, the Company further represents and warrants that the Investors will not, by virtue of acquiring the Rights, the Preferred Shares or the Conversion Shares pursuant to this
Agreement or through the Rights Offering, trigger any anti-takeover rights or protective provisions, applicable to the Company, including under applicable law or under any stockholder rights agreement (“poison pill”) or similar agreement
or arrangement to which the Company is a party. 
 (g)    Consents and Approvals. No consent, approval,
authorization, order, registration, notice, filing, recording or qualification of or with any court or governmental agency or body having jurisdiction over the Company or any of its Subsidiaries or any of their properties is required for the
execution and delivery by the Company of this Agreement, the performance by 

  
 5 

 
the Company of its obligations hereunder and the consummation of the transactions contemplated hereby, including the sale, issuance and delivery of the Preferred Shares to the Investors hereunder
and the issuance of the Conversion Shares upon the conversion of the Preferred Shares, except: (i) the registration under the Securities Act of the issuance of the Offered Shares pursuant to the exercise of the Rights, (ii) the filing of a
Certificate of Designation of Preferences, Rights and Limitations of Series C Convertible Preferred Stock in the form attached hereto as Exhibit A (the “Certificate of Designation”) with the Secretary of State of Delaware,
which will be filed prior to the Closing Date, and (iii) such consents, approvals, authorizations, registrations or qualifications as may be required under state securities or Blue Sky laws in connection with the purchase of the Securities by
the Investors, including a Form D notice with the Securities and Exchange Commission (“SEC”), if required. 

(h)    SEC Filings. For the 12 months preceding the date hereof, the Company has timely filed all current and
periodic reports required to be filed with the SEC (the “SEC Reports”) pursuant the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The SEC Reports, as of the time when they were filed, conformed
in all material respects to the requirements of the Exchange Act, and none of the SEC Reports contained any untrue statement of a material fact, or omitted to state a material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading. 
 (i)    Absence of Changes. Except as disclosed in
the SEC Reports or as otherwise contemplated by this Agreement, since September 30, 2019: (i) there has been no Material Adverse Effect and (ii) the Company has not entered into any transaction or agreement (whether or not in the ordinary
course of business) that is material to the Company or incurred any liability or obligation, direct or contingent, that is material to the Company. 

4.    Representations and Warranties of the Investors. Each Investor, severally and not jointly, represents and warrants to, and
agrees with the Company, as set forth below. Except for representations, warranties and agreements that are expressly limited as to their date, each representation, warranty and agreement is made as of the date hereof and as of the Closing Date
after giving effect to the transactions contemplated hereby: 
 (a)    Authority. Each Investor has the requisite
power and authority to enter into, execute and deliver this Agreement and to perform its obligations hereunder and consummate the transactions contemplated hereby, including the subscription for the Securities. Each Investor has taken all necessary
action required for the due authorization, execution, delivery and performance by it of this Agreement, including the subscription for the Securities. 

(b)    Execution and Delivery; Enforceability. This Agreement has been, or prior to its execution and delivery at
the Closing will be, duly and validly executed and delivered by each Investor, and each such document constitutes, or will constitute, the valid and binding obligation of each Investor, enforceable against such Investor in accordance with its terms
subject to (i) bankruptcy, insolvency, moratorium and other similar laws now or hereafter in effect relating to or affecting creditors’ rights generally, and (ii) general principles of equity (regardless of whether considered in a
proceeding at law or in equity). 

  
 6 

 (c)    No Registration. Each Investor understands that the
Securities have not been registered under the Securities Act by reason of a specific exemption from the registration provisions of the Securities Act, the availability of which depends upon, among other things, the bona fide nature of the investment
intent and the accuracy of such Investor’s representations as expressed herein or otherwise made pursuant hereto. 

(d)    Investment Intent. Each Investor is acquiring the Securities for investment for its own account, not as a
nominee or agent, and not with the view to, or for resale in connection with, any distribution thereof not in compliance with applicable securities laws, and such Investor has no present intention of selling, granting any participation in, or
otherwise distributing the same, except in compliance with applicable securities laws. 
 (e)    Securities Laws
Compliance. The Securities will not be offered for sale, sold or otherwise transferred by each Investor except pursuant to a registration statement or in a transaction exempt from, or not subject to, registration under the Securities Act and any
applicable state securities laws. 
 (f)    Sophistication. Each Investor has such knowledge and experience in
financial and business matters that it is capable of evaluating the merits and risks of its investment in the Securities being acquired hereunder. Each Investor is a “qualified institutional buyer” within the meaning of Rule 144A under the
Securities Act or an “accredited investor” within the meaning of Rule 501 of Regulation D under the Securities Act. Each Investor understands and is able to bear any economic risks associated with such investment (including, without
limitation, the necessity of holding the Securities for an indefinite period of time). Without derogating from or limiting the representations and warranties of the Company, each Investor acknowledges that it has been afforded the opportunity to ask
questions and receive answers concerning the Company and to obtain additional information that it has requested to verify the information contained herein. 

(g)    Legended Securities. Each Investor understands and acknowledges that upon the original issuance thereof, and
until such time as the same is no longer required under any applicable requirements of the Securities Act or applicable state securities laws, the Securities shall be represented by a certificate bearing the following legend (the “Securities
Act Legend”): 
 NEITHER THESE SECURITIES NOR THE SECURITIES ISSUABLE UPON CONVERSION OF THE SECURITIES REPRESENTED HEREBY HAVE BEEN
REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION, OR THE SECURITIES COMMISSION OF ANY STATE UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, SUCH SECURITIES MAY NOT BE OFFERED OR SOLD
(I) EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, (II) PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE

  
 7 

 
WITH APPLICABLE STATE SECURITIES LAWS, AS EVIDENCED BY A LEGAL OPINION OF COUNSEL SELECTED BY THE HOLDER TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY, OR
(III) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER THE SECURITIES ACT. 
 The foregoing Securities Act Legend shall be promptly removed from the
Securities and the Company shall issue, or cause to be issued, to each Investor a certificate for such Securities without such legend or any other legend, or, if so requested by an Investor, by electronic delivery at the applicable balance account
at the Depository Trust Company, if one of the following conditions is met: (a) such Securities are eligible for resale pursuant to Rule 144 of the Securities Act without regard to any volume limitations; (b) in connection with a sale,
assignment or other transfer of such Securities, an Investor provides the Company with an opinion of counsel, in a generally acceptable form to the Company and its transfer agent, to the effect that such sale, assignment or transfer of such
Securities may be made without registration under the applicable requirements of the Securities Act and that the legend can be removed from the Securities; or (c) the Securities are registered and sold pursuant to an effective registration
statement for resale under the Securities Act. 
 (h)    No Short Sales. Each Investor has not, nor has any
person acting on behalf of or pursuant to any understanding with such Investor, directly or indirectly, executed any “short sales” (as defined in Rule 200 of Regulation SHO under the Exchange Act) (“Short Sales”) of the
securities of the Company during the period commencing as of the time that such Investor was first contacted by the Company or any other person regarding the transactions contemplated hereby and ending the date hereof. 

5.    Short Sales After the Date Hereof. Each Investor covenants that neither it nor any affiliates acting on its behalf or
pursuant to any understanding with it will, directly or indirectly, engage in any Short Sales involving the Company’s securities during the period from the date hereof until the earlier of (i) the Closing Date or (ii) such time as
this Agreement is terminated in full. 
 6.    Conditions to the Obligations of the Parties. 

(a)    The obligations of each Investor hereunder to consummate the transactions contemplated hereby shall be subject to
the satisfaction prior to the Closing Date of each of the following conditions (which may be waived in whole or in part by an Investor (with respect to itself only) in its sole discretion): 

(i)    Rights Offering. The Rights Offering shall have been completed by the Company before March 6, 2020 on
the terms set forth herein and each Investor shall have been offered the right to purchase Offered Shares in the Rights Offering with a value at least equal to such Investor’s Final Purchase Commitment. 

  
 8 

 (ii)    Purchase or Satisfaction Notice. Such Investor shall have
timely received either a Purchase Notice from the Company on the Determination Date, certifying the number of Backstop Shares to be purchased pursuant to the Backstop Commitment, or a Satisfaction Notice. 

(iii)    Consents. All governmental and third party notifications, filings, consents, waivers and approvals
required for the consummation of the transactions contemplated by this Agreement shall have been made or received, including filing of the Certificate of Designation with the Secretary of State of Delaware and any applicable approvals required by
The Nasdaq Global Select Market. 
 (iv)    Representations and Warranties. The representations and warranties of
the Company contained in this Agreement shall be true and correct in all material respects (except with respect to representations and warranties that are qualified by the term “material” or “Material Adverse Effect” or similar
term, which shall be true and correct in all respects) on the date hereof and as of the Closing Date. 
 (v)    No
Material Adverse Effect. Since the date of this Agreement, there shall not have occurred (i) any outbreak of hostilities or escalation thereof or other calamity or crisis or any change or development involving a prospective change in
national or international political, financial or economic conditions, (ii) a suspension or material limitation on trading, or minimum or maximum prices for trading having been fixed, or maximum ranges for prices having been required, by The
Nasdaq Global Select Market or any other securities exchange or by order of the SEC or any other governmental authority, (iii) a material disruption in commercial banking or securities settlement or clearance services in the United States, or
(iv) a declaration of a banking moratorium by either Federal or New York authorities. 
 (b)    The obligation of
the Company to issue and sell the Preferred Shares is subject to the following conditions (which may be waived in whole or in part by the Company in its sole discretion): 

(i)    No Legal Impediment to Issuance. No statute, rule, regulation or order shall have been enacted, adopted or
issued by any federal, state or foreign governmental or regulatory authority, and no judgment, injunction, decree or order of any federal, state or foreign court shall have been issued, that prohibits the issuance of the Preferred Shares to the
Investors or the consummation of the transactions contemplated by this Agreement. 
 (ii)    Representations and
Warranties. The representations and warranties of each Investor shall be true and correct in all material respects (except with respect to representations and warranties that are qualified by the term “material” or “Material
Adverse Effect” or similar term, which shall be true and correct in all respects) on the date hereof and as of the Closing Date. 

(iii)    Rights Offering. The Rights Offering shall have been completed by the Company. 

  
 9 

 7.    Termination. This Agreement may be terminated by mutual written consent of
the Company and an Investor (with respect to itself only) or by an Investor (with respect to itself only) if the Closing has not been consummated within ten (10) business days from the Expiration Time through no fault of such Investor;
provided, however, that no such termination will affect the right of any party to sue for any breach by the other party (or parties). 

8.    Notices. All notices and other communications in connection with this Agreement will be in writing and will be deemed given
(and will be deemed to have been duly given upon receipt) if delivered personally, sent via electronic transmission or facsimile (with confirmation), mailed by registered or certified mail (return receipt requested) or delivered by an express
courier (with confirmation) to the parties at the following addresses (or at such other address for a party as will be specified by like notice): 

If to the Company: 
 Spero
Therapeutics, Inc. 
 675 Massachusetts Avenue, 14th Floor 

Cambridge, MA 02139 
 Attn: Ankit
Mahadevia, M.D. 
 Email: ankit@sperotherapeutics.com 

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

Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. 

One Financial Center 
 Boston, MA
02111 
 Attn: Matthew Gardella 

Email: mgardella@mintz.com 
 If to
the Investors: 
 c/o BVF Partners, LP 

44 Montgomery Street 40th Floor 

San Francisco, California 94104 

Attn: Matthew Perry 
 Email:
perry@bvflp.com 
 with a copy (which shall not constitute notice) to: 

Gibson, Dunn & Crutcher, LLP 

555 Mission St., Suite 3000 
 San
Francisco, CA 94105 
 Attn: Ryan Murr 

Email: rmurr@gibsondunn.com 

  
 10 

 9.    Assignment; Third Party Beneficiaries. Neither this Agreement nor any of
the rights, interests or obligations under this Agreement may be assigned by any of the parties (whether by operation of law or otherwise) without the prior written consent of the other party, provided that each Investor may assign part or all of
its rights and obligations hereunder to an affiliate of such Investor, provided that the assigning party shall remain liable for any non-performance of such assignee’s assigned obligations. This Agreement
(including the documents and instruments referred to in this Agreement) is not intended to and does not confer upon any person other than the parties hereto any rights or remedies under this Agreement. 

10.    Prior Negotiations; Entire Agreement. This Agreement (including the agreements attached as exhibits to and the documents and
instruments referred to in this Agreement) constitutes the entire agreement of the parties and supersedes all prior agreements, arrangements or understandings, whether written or oral, between the parties with respect to the subject matter of this
Agreement, except that the parties hereto acknowledge that any confidentiality agreements heretofore executed among the parties will continue in full force and effect. 

11.    Governing Law. All questions concerning the construction, validity, enforcement and interpretation of this Agreement shall
be governed by and construed and enforced in accordance with the internal laws of the State of Delaware, without regard to the principles of conflicts of law thereof. Each party agrees that all legal proceedings concerning the interpretations,
enforcement and defense of the transactions contemplated by this Agreement (whether brought against a party hereto or its respective affiliates, directors, officers, shareholders, employees or agents) shall be commenced exclusively in the state and
federal courts sitting in the State of Delaware. Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in the State of Delaware for the adjudication of any dispute hereunder or in connection
herewith or with any transaction contemplated hereby or discussed herein (including with respect to the enforcement of this Agreement), and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is
not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is improper or is an inconvenient venue for such proceeding. Each party hereby irrevocably waives personal service of process and consents to process
being served in any such suit, action or proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Agreement and agrees
that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law. If either party shall
commence an action or proceeding to enforce any provisions of this Agreement, then the prevailing party in such action or proceeding shall be reimbursed by the other party for its reasonable attorneys’ fees and other costs and expenses incurred
with the investigation, preparation and prosecution of such action or proceeding. 
 12.    Fees and Expenses. Except as
expressly set forth in this Agreement to the contrary, each party shall pay the fees and expenses of its advisers, counsel, accountants and other experts, if any, and all other expenses incurred by such party incident to the negotiation,
preparation, execution, delivery and performance of this Agreement; provided, however, at the Closing, the Company shall reimburse the Investors for their reasonable and documented legal fees and expenses incurred in connection with this
Agreement and the Rights Offering, not to exceed $50,000 in the aggregate. 

  
 11 

 13.    Certain Defined Terms. For purposes of this Agreement, (a) except
where otherwise expressly provided, the term “affiliate” has the meaning set forth in Rule 405 under the Securities Act; and (b) the term “business day” means any day other than a day on which banks are permitted or required
to be closed in New York City. 
 14.    Counterparts. This Agreement may be executed in counterparts, all of which will be
considered one and the same agreement and will become effective when counterparts have been signed by each of the parties and delivered to the other party (including via facsimile or other electronic transmission), it being understood that each
party need not sign the same counterpart. 
 15.    Waivers and Amendments. This Agreement may be amended, modified, superseded,
cancelled, renewed or extended, and the terms and conditions of this Agreement may be waived, only by a written instrument signed by all the parties or, in the case of a waiver, by the party waiving compliance. No delay on the part of any party in
exercising any right, power or privilege pursuant to this Agreement will operate as a waiver thereof, nor will any waiver on the part of any party of any right, power or privilege pursuant to this Agreement, nor will any single or partial exercise
of any right, power or privilege pursuant to this Agreement, preclude any other or further exercise thereof or the exercise of any other right, power or privilege pursuant to this Agreement. The rights and remedies provided pursuant to this
Agreement are cumulative and are not exclusive of any rights or remedies which any party otherwise may have at law or in equity. 

16.    Headings. The headings in this Agreement are for reference purposes only and will not in any way affect the meaning or
interpretation of this Agreement. 
 [Signature Page Follows] 

  
 12 

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

			
	 Spero Therapeutics, Inc.

 

 
			
	By:	 	 /s/ Stephen DiPalma

			
	Name: Stephen DiPalma
	Title: Interim Chief Financial Officer

  
 [Company Signature
Page to Investment Agreement] 

 Purchase Commitment: $30,000,000 

 

			
	 Biotechnology Value Fund, L.P.

 

 
			
	By:	 	 /s/ Mark Lampert

 
			
	Name: Mark Lampert
	Title: President BVF Inc., General Partner of BVF Partners L.P., itself GP of Biotechnology Value Fund, L.P.
	Date: 01/30/2020
	Estimated Allocation of Purchase Commitment: 51%

  

			
	 Biotechnology Value Fund II, LP

 

 
			
	By:	 	 /s/ Mark Lampert

 
			
	Name: Mark Lampert
	Title: President BVF Inc., General Partner of BVF Partners L.P., itself GP of Biotechnology Value Fund II, LP
	Date: 01/30/2020
	Estimated Allocation of Purchase Commitment: 39%

  

			
	 Biotechnology Value Trading Fund OS, L.P.

 

 
			
	By:	 	 /s/ Mark Lampert

 
			
	Name: Mark Lampert
	Title: President BVF Inc., General Partner of BVF Partners L.P., itself sole member of BVF Partners OS Ltd., itself GP of Biotechnology Value Trading Fund OS, L.P.
	Date: 01/30/2020
	Estimated Allocation of Purchase Commitment: 7%

  

			
	 MSI BVF SPV, L.L.C.

 

 
			
	By:	 	 /s/ Mark Lampert

 
			
	Name: Mark Lampert
	Title: President BVF Inc., General Partner of BVF Partners L.P., itself attorney-in-fact for MSI BVF SPV, L.L.C.
	Date: 01/30/2020
	Estimated Allocation of Purchase Commitment: 3%

  
 [BVF Signature
Page to Investment Agreement] 

 EXHIBIT A 

SERIES C CERTIFICATE OF DESIGNATION 

[See attachment] 

 EXHIBIT A 

SPERO THERAPEUTICS, INC. 

CERTIFICATE OF DESIGNATION OF PREFERENCES, 

RIGHTS AND LIMITATIONS 

OF 
 SERIES C CONVERTIBLE
PREFERRED STOCK 
 PURSUANT TO SECTION 151 OF THE 

DELAWARE GENERAL CORPORATION LAW 
 The
undersigned, Ankit Mahadevia, does hereby certify that: 
 1.    He is the President and Chief Executive Officer of Spero Therapeutics,
Inc., a Delaware corporation (the “Corporation”). 
 2.    The Corporation is authorized to issue 10,000,000
shares of preferred stock, 3,220 of which have been designated. 
 3.    The following resolutions were duly adopted by the board of
directors of the Corporation (the “Board of Directors”) in accordance with the provisions of Section 103 of the Delaware General Corporation Law (the “DGCL”) does hereby certify that, in
accordance with Section 151 of the DGCL, the following resolution was duly adopted by the Board of Directors of the Corporation or by a duly authorized committee thereof, on January 27, 2020: 

WHEREAS, the Amended and Restated Certificate of Incorporation of the Corporation, as amended (the “Certificate of Incorporation”),
provides for a class of its authorized stock known as preferred stock, consisting of 10,000,000 shares, $0.001 par value per share, issuable from time to time in one or more series; 

WHEREAS, the Board of Directors is authorized to fix the dividend rights, dividend rate, voting rights, conversion rights, rights and terms of redemption and
liquidation preferences of any wholly unissued series of preferred stock and the number of shares constituting any series and the designation thereof, of any of them; and 

WHEREAS, it is the desire of the Board of Directors, pursuant to its authority as aforesaid, to fix the rights, preferences, restrictions and other matters
relating to a new series of the preferred stock, which shall consist of 3,333 shares of the preferred stock which the Corporation has the authority to issue, as follows: 

NOW, THEREFORE, BE IT RESOLVED, that the Board of Directors does hereby provide for the issuance of a series of preferred stock for cash or exchange of other
securities, rights or property and does hereby fix and determine the rights, preferences, restrictions and other matters relating to such series of preferred stock as follows: 

RESOLVED, pursuant to authority expressly set forth in the Amended and Restated Certificate of Incorporation of the Corporation, as amended (the
“Certificate of Incorporation”), the 

 
issuance of a series of Preferred Stock designated as the Series C Convertible Preferred Stock, par value $.001 per share, of the Corporation is hereby authorized and the designation, number of
shares, powers, preferences, rights, qualifications, limitations and restrictions thereof (in addition to any provisions set forth in the Certificate of Incorporation that are applicable to the Preferred Stock of all classes and series) are hereby
fixed, and the Certificate of Designation of Preferences, Rights and Limitations of Series C Convertible Preferred Stock is hereby approved as follows: 

SERIES C CONVERTIBLE PREFERRED STOCK 

Section 1.    Definitions. For the purposes hereof, the following terms shall have the following meanings: 

“Affiliate” means any person or entity that, directly or indirectly through one or more intermediaries, controls or is controlled by or
is under common control with a person or entity, as such terms are used in and construed under Rule 144 under the Securities Act. With respect to a Holder, any investment fund or managed account that is managed on a discretionary basis by the same
investment manager as such Holder will be deemed to be an Affiliate of such Holder. 
 “Alternate Consideration” shall have the
meaning set forth in Section 7(b). 
 “Beneficial Ownership Limitation” shall have the meaning set forth in Section 6(c).

 “Business Day” means any day except Saturday, Sunday, any day which shall be a federal legal holiday in the United States or any
day on which banking institutions in the State of New York are authorized or required by law or other governmental action to close. 
 “Buy-In” shall have the meaning set forth in Section 6(d)(iii). 
 “Closing Sale
Price” means, for any security as of any date, the last closing trade price for such security prior to 4:00 p.m., New York City time, on the principal securities exchange or trading market where such security is listed or traded, as
reported by Bloomberg, L.P. (or an equivalent, reliable reporting service mutually acceptable to and hereafter designated by Holders of a majority of the then-outstanding Series C Preferred Stock and the Corporation), or if the foregoing do not
apply, the last trade price of such security in the over-the-counter market on the electronic bulletin board for such security as reported by Bloomberg, L.P., or, if no
last trade price is reported for such security by Bloomberg, L.P., the average of the bid prices of any market makers for such security as reported on the OTC Pink Market by OTC Markets Group, Inc. If the Closing Sale Price cannot be calculated for
a security on a particular date on any of the foregoing bases, the Closing Sale Price of such security on such date shall be the fair market value as determined in good faith by the Board of Directors of the Corporation. 

“Commission” means the U.S. Securities and Exchange Commission. 

“Common Stock” means the Corporation’s common stock, par value $.001 per share, and stock of any other class of securities into
which such securities may hereafter be reclassified or changed into. 

  
 2 

 “Conversion Date” shall have the meaning set forth in Section 6(a). 

“Conversion Ratio” shall have the meaning set forth in Section 6(b). 

“Conversion Shares” means, collectively, the shares of Common Stock issuable upon conversion of the shares of Series C Preferred Stock
in accordance with the terms hereof. 
 “Daily Failure Amount” means the product of (x).005 multiplied by (y) the Closing Sale
Price of the Common Stock on the applicable Share Delivery Date. 
 “Distributions” shall have the meaning set forth in
Section 5(a). 
 “DTC” shall have the meaning set forth in Section 6(a). 

“DWAC Delivery” shall have the meaning set forth in Section 6(a). 

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder. 

“Fundamental Transaction” shall have the meaning set forth in Section 7(b). 

“Holder” means any holder of Series C Preferred Stock. 

“Junior Securities” shall have the meaning set forth in Section 5(a). 

“Notice of Conversion” shall have the meaning set forth in Section 6(a). 

“Parity Securities” shall have the meaning set forth in Section 5(a). 

“Person” means any individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited
liability company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind. 
 “Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder. 
 “Senior
Securities” shall have the meaning set forth in Section 5(a). 
 “Series C Preferred Stock” shall have the meaning
set forth in Section 2(a). 
 “Series C Preferred Stock Register” shall have the meaning set forth in Section 2(b). 

“Share Delivery Date” shall have the meaning set forth in Section 6(d)(i). 

  
 3 

 “Trading Day” means a day on which the Common Stock is traded for any period on the
principal securities exchange or if the Common Stock is not traded on a principal securities exchange, on a day that the Common Stock is traded on another securities market on which the Common Stock is then being traded. 

Section 2.    Designation, Amount and Par Value; Assignment. 

(a)    The series of preferred stock designated by this Certificate of Designation shall be designated as the Corporation’s Series C
Convertible Preferred Stock (the “Series C Preferred Stock”) and the number of shares so designated shall be 3,333. Each share of Series C Preferred Stock shall have a par value of $.001 per share. The Series C Preferred
Stock shall be issued in book-entry form, or if requested by any Holder, such Holder’s shares may be issued in certificated form. To the extent that any shares of Series C Preferred Stock are issued in book-entry form, references herein to
“certificates” shall refer to the book-entry notation relating to such shares. 
 (b)    The Corporation shall register shares
of the Series C Preferred Stock, upon records to be maintained by the Corporation for that purpose (the “Series C Preferred Stock Register”), in the name of the Holders thereof from time to time. The Corporation may deem and
treat the registered Holder of shares of Series C Preferred Stock as the absolute owner thereof for the purpose of any conversion thereof and for all other purposes. The Corporation shall register the transfer of any shares of Series C Preferred
Stock in the Series C Preferred Stock Register, upon surrender of the certificates evidencing such shares to be transferred, duly endorsed by the Holder thereof, to the Corporation at its address specified herein. Upon any such registration or
transfer, a new certificate evidencing the shares of Series C Preferred Stock so transferred shall be issued to the transferee and a new certificate evidencing the remaining portion of the shares not so transferred, if any, shall be issued to the
transferring Holder, in each case, within three Business Days. The provisions of this Certificate of Designation are intended to be for the benefit of all Holders from time to time and shall be enforceable by any such Holder. 

Section 3.    Dividends. Holders shall be entitled to receive, and the Corporation shall pay, dividends on shares of the
Series C Preferred Stock equal (on an as-if-converted-to-Common-Stock basis, without
regard to the Beneficial Ownership Limitation) to and in the same form, and in the same manner, as dividends (other than dividends in the form of Common Stock) actually paid on shares of the Common Stock when, as and if such dividends (other than
dividends in the form of Common Stock) are paid on shares of the Common Stock. Other than as set forth in the previous sentence, no other dividends shall be paid on shares of Series C Preferred Stock, and the Corporation shall pay no dividends
(other than dividends in the form of Common Stock) on shares of the Common Stock unless it simultaneously complies with the previous sentence. 

Section 4.    Voting Rights. Except as otherwise provided herein or in the Certificate of Incorporation, or as otherwise
required by the DGCL, the Series C Preferred Stock shall have no voting rights. However, as long as any shares of Series C Preferred Stock are outstanding, the Corporation shall not, without the affirmative vote of the Holders of a majority of the
then outstanding shares of the Series C Preferred Stock, (i) alter or change the powers, preferences or special rights given to the shares of Series C Preferred Stock so as to affect them adversely, (ii) issue further shares of Series C
Preferred Stock or increase or decrease (other than by conversion) the number of authorized shares of Series C Preferred Stock, or (iii) enter into any agreement with respect to any of the foregoing. 

  
 4 

 Section 5.    Rank; Liquidation. 

(a)    The Series C Preferred Stock shall rank: (i) senior to all of the Common Stock; (ii) senior to any class or series of
capital stock of the Corporation hereafter created specifically ranking by its terms junior to any Series C Preferred Stock (“Junior Securities”); (iii) on parity with all shares of the Corporation’s Series A Convertible
Preferred Stock and Series B Convertible Preferred Stock; (iv) on parity with any class or series of capital stock of the Corporation hereafter created specifically ranking by its terms on parity with the Series C Preferred Stock (together with
the Corporation’s Series A Convertible Preferred Stock and Series B Convertible Preferred Stock, the “Parity Securities”); and (v) junior to any class or series of capital stock of the Corporation hereafter created
specifically ranking by its terms senior to any Series C Preferred Stock (“Senior Securities”), in each case, as to distributions of assets upon liquidation, dissolution or winding up of the Corporation, whether voluntarily
or involuntarily (all such distributions being referred to collectively as “Distributions”) and/or as to the right to receive dividends. 

(b)    Subject to the prior and superior rights of the holders of any Senior Securities of the Corporation, upon liquidation, dissolution
or winding up of the Corporation, whether voluntary or involuntary, each holder of shares of Series C Preferred Stock shall be entitled to receive, in preference to any distributions of any of the assets or surplus funds of the Corporation to the
holders of the Common Stock and Junior Securities and pari passu with any distribution to the holders of Parity Securities, an amount equal to $.001 per share of Series C Preferred Stock, plus an additional amount equal to any dividends declared but
unpaid on such shares, before any payments shall be made or any assets distributed to holders of any class of Common Stock or Junior Securities. If, upon any such liquidation, dissolution or winding up of the Corporation, the assets of the
Corporation shall be insufficient to pay the holders of shares of the Series C Preferred Stock the amount required under the preceding sentence, then all remaining assets of the Corporation shall be distributed ratably to holders of the shares of
the Series C Preferred Stock and Parity Securities. After such preferential payment, each holder of shares of Series C Preferred Stock shall be entitled to participate pari passu with the holders of Common Stock (on an
as-converted basis, without regard to the Beneficial Ownership Limitation) and holders of Parity Securities in the remaining distribution of the net assets of the Corporation available for distribution. 

Section 6.    Conversion. 

(a)    Conversions at Option of Holder. Each share of Series C Preferred Stock shall be convertible, at any time and from time to
time from and after the date of issuance, at the option of the Holder thereof, into a number of shares of Common Stock equal to the Conversion Ratio. Holders shall effect conversions by providing the Corporation with the form of conversion notice
attached hereto as Annex A (a “Notice of Conversion”), duly completed and executed. Other than a conversion following a Fundamental Transaction or following a notice provided for under Section 7(d)(ii) hereof, the Notice
of Conversion must specify at least a number of shares of Series C Preferred Stock to be converted equal to the lesser of (x) 100 shares (such number 

  
 5 

 
subject to appropriate adjustment following the occurrence of an event specified in Section 7(a) hereof) and (y) the number of shares of Series C Preferred Stock then held by the
Holder. Provided the Corporation’s transfer agent is participating in the Depository Trust Company (“DTC”) Fast Automated Securities Transfer program, the Notice of Conversion may specify, at the Holder’s election,
whether the applicable Conversion Shares shall be credited to the account of the Holder’s prime broker with DTC through its Deposit Withdrawal Agent Commission system (a “DWAC Delivery”). The “Conversion
Date”, or the date on which a conversion shall be deemed effective, shall be defined as the Trading Day that the Notice of Conversion, completed and executed, is sent by facsimile to, and received during regular business hours by, the
Corporation; provided that the original certificate(s) (if applicable) representing such shares of Series C Preferred Stock being converted, duly endorsed, and the accompanying Notice of Conversion, are received by the Corporation within two
(2) Trading Days thereafter. In all other cases, the Conversion Date shall be defined as the Trading Day on which the original share certificates (if applicable) of Series C Preferred Stock being converted, duly endorsed, and the accompanying
Notice of Conversion, are received by the Corporation. The calculations set forth in the Notice of Conversion shall control in the absence of manifest or mathematical error. 

(b)    Conversion Ratio. The “Conversion Ratio” for each share of Series C Preferred Stock shall initially
be 1,000 shares of Common Stock issuable upon the conversion of each share of Series C Preferred Stock (corresponding to a ratio of 1:1,000), subject to adjustment pursuant to Section 7. 

(c)    Beneficial Ownership Limitation. Notwithstanding anything herein to the contrary, the Corporation shall not effect any
conversion of the Series C Preferred Stock, and a Holder shall not have the right to convert any portion of the Series C Preferred Stock, to the extent that, after giving effect to an attempted conversion set forth on an applicable Notice of
Conversion, such Holder (together with such Holder’s Affiliates, and any other Person whose beneficial ownership of Common Stock would be aggregated with the Holder’s for purposes of Section 13(d) or Section 16 of the Exchange
Act and the applicable regulations of the Commission, including any “group” of which the Holder is a member (the foregoing, “Attribution Parties”)) would beneficially own a number of shares of Common Stock 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 such Holder and its Attribution Parties shall include the number of shares of Common Stock
issuable upon conversion of the Series C Preferred Stock subject to the Notice of Conversion with respect to which such determination is being made, but shall exclude the number of shares of Common Stock which are issuable upon (A) conversion
of the remaining, unconverted Series C Preferred Stock beneficially owned by such Holder or any of its Attribution Parties, and (B) exercise or conversion of the unexercised or unconverted portion of any other securities of the Corporation
(including any warrants) beneficially owned by such Holder or any of its Attribution Parties that are subject to a limitation on conversion or exercise similar to the limitation contained herein. For purposes of this Section 6(c), beneficial
ownership shall be calculated in accordance with Section 13(d) of the Exchange Act and the applicable regulations of the Commission. In addition, for purposes hereof, “group” has the meaning set forth in Section 13(d) of the
Exchange Act and the applicable regulations of the Commission. For purposes of this Section 6(c), in determining the number of outstanding shares of Common Stock, a Holder may rely on the number of outstanding shares of Common Stock as stated
in the most recent of the following: (A) the Corporation’s most recent periodic or annual 

  
 6 

 
filing with the Commission, as the case may be, (B) a more recent public announcement by the Corporation that is filed with the Commission, or (C) a more recent notice by the
Corporation or the Corporation’s transfer agent to the Holder setting forth the number of shares of Common Stock then outstanding. Upon the written request of a Holder (which may be by email), the Corporation shall, within three
(3) Trading Days thereof, confirm in writing to such Holder (which may be via email) 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
any actual conversion or exercise of securities of the Corporation, including shares of Series C Preferred Stock, by such Holder or its Attribution Parties since the date as of which such number of outstanding shares of Common Stock was last
publicly reported or confirmed to the Holder. The “Beneficial Ownership Limitation” shall initially be 9.99% of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares of
Common Stock pursuant to such Notice of Conversion (to the extent permitted pursuant to this Section 6(c)). The Corporation shall be entitled to rely on representations made to it by the Holder in any Notice of Conversion regarding its
Beneficial Ownership Limitation. Notwithstanding the foregoing, by written notice to the Corporation, which will not be effective until the sixty-first (61st) day after such notice is delivered to the Corporation, the Holder may reset the Beneficial
Ownership Limitation percentage to a higher or lower percentage, not to exceed 9.99% of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock pursuant to such Notice of
Conversion. Upon such a change by a Holder of the Beneficial Ownership Limitation, the Beneficial Ownership Limitation may not be further amended by such Holder without first providing the minimum notice required by this Section 6(c).
Notwithstanding the foregoing, at any time following notice of a Fundamental Transaction, the Holder may waive and/or change the Beneficial Ownership Limitation effective immediately upon written notice to the Corporation and may reinstitute the
Beneficial Ownership Limitation at any time thereafter effective immediately upon written notice to the Corporation. 

(d)    Mechanics of Conversion. 
  

	 	(i)	 Delivery of Certificate or Electronic Issuance Upon Conversion. Not later than three Trading Days after
the applicable Conversion Date, or if the Holder requests the issuance of physical certificate(s), two (2) Trading Days after receipt by the Corporation of the original certificate(s) representing such shares of Series C Preferred Stock being
converted, duly endorsed, and the accompanying Notice of Conversion (the “Share Delivery Date”), the Corporation shall (a) deliver, or cause to be delivered, to the converting Holder a physical certificate or
certificates representing the number of Conversion Shares being acquired upon the conversion of shares of Series C Preferred Stock, or (b) in the case of a DWAC Delivery (if so requested by the Holder), electronically transfer such Conversion
Shares by crediting the account of the Holder’s prime broker with DTC through its DWAC system. If in the case of any Notice of Conversion such certificate or certificates are not delivered to or as directed by or, in the case of a DWAC
Delivery, such shares are not electronically delivered to or as directed by, the applicable Holder by the Share Delivery Date, the applicable Holder shall be entitled to elect to rescind such Notice of Conversion by written notice to the Corporation
at any time on or before its receipt of such certificate or certificates 

  
 7 

	 	
for Conversion Shares or electronic receipt of such shares, as applicable, in which event the Corporation shall promptly return to such Holder any original Series C Preferred Stock certificate
delivered to the Corporation and such Holder shall promptly return to the Corporation any Common Stock certificates or otherwise direct the return of any shares of Common Stock delivered to the Holder through the DWAC system, representing the shares
of Series C Preferred Stock unsuccessfully tendered for conversion to the Corporation. 

  

	 	(ii)	 Obligation Absolute. Subject to Section 6(c) hereof and subject to Holder’s right to rescind a
Notice of Conversion pursuant to Section 6(d)(i) above, the Corporation’s obligation to issue and deliver the Conversion Shares upon conversion of Series C Preferred Stock in accordance with the terms hereof are absolute and unconditional,
irrespective of any action or inaction by a Holder to enforce the same, any waiver or consent with respect to any provision hereof, the recovery of any judgment against any Person or any action to enforce the same, or any setoff, counterclaim,
recoupment, limitation or termination, or any breach or alleged breach by such Holder or any other Person of any obligation to the Corporation or any violation or alleged violation of law by such Holder or any other Person, and irrespective of any
other circumstance which might otherwise limit such obligation of the Corporation to such Holder in connection with the issuance of such Conversion Shares. Subject to Section 6(c) hereof and subject to Holder’s right to rescind a Notice of
Conversion pursuant to Section 6(d)(i) above, in the event a Holder shall elect to convert any or all of its Series C Preferred Stock, the Corporation may not refuse conversion based on any claim that such Holder or anyone associated or
affiliated with such Holder has been engaged in any violation of law, agreement or for any other reason, unless an injunction from a court, on notice to Holder, restraining and/or enjoining conversion of all or part of the Series C Preferred Stock
of such Holder shall have been sought and obtained by the Corporation, and the Corporation posts a surety bond for the benefit of such Holder in the amount of 150% of the value of the Conversion Shares into which would be converted the Series C
Preferred Stock which is subject to such injunction, which bond shall remain in effect until the completion of arbitration/litigation of the underlying dispute and the proceeds of which shall be payable to such Holder to the extent it obtains
judgment. In the absence of such injunction, the Corporation shall, subject to Section 6(c) hereof and subject to Holder’s right to rescind a Notice of Conversion pursuant to Section 6(d)(i) above, issue Conversion Shares upon a
properly noticed conversion. If the Corporation fails to deliver to a Holder such certificate or certificates, or electronically deliver (or cause its transfer agent to electronically deliver) such shares in the case of a DWAC Delivery, pursuant to
Section 6(d)(i) on or prior to the fifth (5th) Trading Day after the Share Delivery Date applicable to such conversion (other than a failure caused by incorrect or incomplete information provided by Holder to the Corporation), then, unless the
Holder has rescinded the applicable Notice of Conversion pursuant to Section 6(d)(i) above, the Corporation shall pay (as liquidated damages and not as a penalty) to such Holder an amount payable, at the Corporation’s option, either
(a) in cash or (b) to the extent that it would not cause the Holder or its Attribution Parties to exceed 

  
 8 

	 	
the Beneficial Ownership Limitation, in shares of Common Stock that are valued for these purposes at the Closing Sale Price on the date of such calculation, in each case equal to the product of
(x) the number of Conversion Shares required to have been issued by the Corporation on such Share Delivery Date, (y) an amount equal to the Daily Failure Amount and (z) the number of Trading Days actually lapsed after such fifth (5th)
Trading Day after the Share Delivery Date during which such certificates have not been delivered, or, in the case of a DWAC Delivery, such shares have not been electronically delivered; provided, however, the Holder shall only receive up to such
amount of shares of Common Stock such that Holder and its Attribution Parties and any other persons or entities whose beneficial ownership of Common Stock would be aggregated with the Holder’s for purposes of Section 13(d) of the Exchange
Act (including shares held by any “group” of which the Holder is a member, but excluding shares beneficially owned by virtue of the ownership of securities or rights to acquire securities that have limitations on the right to convert,
exercise or purchase similar to the limitation set forth herein) shall not collectively beneficially own greater than the Beneficial Ownership Limitation. Nothing herein shall limit a Holder’s right to pursue actual damages for the
Corporation’s failure to deliver Conversion Shares within the period specified herein and such Holder shall have the right to pursue all remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific
performance and/or injunctive relief; provided that Holder shall not receive duplicate damages for the Corporation’s failure to deliver Conversion Shares within the period specified herein. The exercise of any such rights shall not prohibit a
Holder from seeking to enforce damages pursuant to any other Section hereof or under applicable law. 

  

	 	(iii)	 Compensation for Buy-In on Failure to Timely Deliver Certificates
Upon Conversion. If the Corporation fails to deliver to a Holder the applicable certificate or certificates or to effect a DWAC Delivery, as applicable, by the Share Delivery Date pursuant to Section 6(d)(i) (other than a failure caused by
incorrect or incomplete information provided by Holder to the Corporation), and if after such Share Delivery Date such Holder is required by its brokerage firm 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 such Holder of the Conversion Shares which such Holder was entitled to receive upon the conversion relating to such Share Delivery Date (a “Buy-In”), then the Corporation shall (A) pay in cash to such Holder (in addition to any other remedies available to or elected by such Holder) the amount by which (x) such Holder’s total
purchase price (including any brokerage commissions) for the shares of Common Stock so purchased exceeds (y) the product of (1) the aggregate number of shares of Common Stock that such Holder was entitled to receive from the conversion at
issue multiplied by (2) the actual sale price at which the sell order giving rise to such purchase obligation was executed (including any brokerage commissions) and (B) at the option of such Holder, either reissue (if surrendered) the
shares of Series C Preferred Stock equal to the number of shares of Series C Preferred Stock submitted for conversion or deliver to such Holder the number of shares of Common Stock that would have been

  
 9 

	 	
issued if the Corporation had timely complied with its delivery requirements under Section 6(d)(i). For example, if a Holder purchases shares of Common Stock having a total purchase price of
$11,000 to cover a Buy-In with respect to an attempted conversion of shares of Series C Preferred Stock with respect to which the actual sale price (including any brokerage commissions) giving rise to such
purchase obligation was a total of $10,000 under clause (A) of the immediately preceding sentence, the Corporation shall be required to pay such Holder $1,000. The Holder shall provide the Corporation written notice, within three
(3) Trading Days after the occurrence of a Buy-In, indicating the amounts payable to such Holder in respect of such Buy-In together with applicable confirmations
and other evidence reasonably requested by the Corporation. 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 Corporation’s failure to timely deliver certificates representing shares of Common Stock upon conversion of the shares of Series C Preferred Stock as required pursuant to the terms hereof; provided,
however, that the Holder shall not be entitled to both (i) require the reissuance of the shares of Series C Preferred Stock submitted for conversion for which such conversion was not timely honored and (ii) receive the number of shares of
Common Stock that would have been issued if the Corporation had timely complied with its delivery requirements under Section 6(d)(i). 

  

	 	(iv)	 Reservation of Shares Issuable Upon Conversion. The Corporation covenants that it will at all times
reserve and keep available out of its authorized and unissued shares of Common Stock for the sole purpose of issuance upon conversion of the Series C Preferred Stock, free from preemptive rights or any other actual contingent purchase rights of
Persons other than the Holders of the Series C Preferred Stock, not less than such aggregate number of shares of the Common Stock as shall be issuable (taking into account the adjustments of Section 7) upon the conversion of all outstanding
shares of Series C Preferred Stock. The Corporation covenants that all shares of Common Stock that shall be so issuable shall, upon issue, be duly authorized, validly issued, fully paid and non-assessable.

  

	 	(v)	 Fractional Shares. No fractional shares or scrip representing fractional shares of Common Stock shall be
issued upon the conversion of the Series C Preferred Stock. As to any fraction of a share which a Holder would otherwise be entitled to receive upon such conversion, the Corporation shall pay a cash adjustment in respect of such fractional share of
Common Stock in an amount equal to such fraction multiplied by the Closing Sale Price. 

  

	 	(vi)	 Transfer Taxes. The issuance of certificates for shares of the Common Stock upon conversion of the
Series C Preferred Stock shall be made without charge to any Holder for any documentary stamp or similar taxes that may be payable in respect of the issue or delivery of such certificates, provided that the Corporation shall not be required to pay
any tax that may be payable in respect of any transfer involved 

  
 10 

	 	
in the issuance and delivery of any such certificate upon conversion in a name other than that of the registered Holder(s) of such shares of Series C Preferred Stock and the Corporation shall not
be required to issue or deliver such certificates unless or until the Person or Persons requesting the issuance thereof shall have paid to the Corporation the amount of such tax or shall have established to the satisfaction of the Corporation that
such tax has been paid. 

 (e)    Status as Stockholder. Upon each Conversion Date: (i) the shares of Series C
Preferred Stock being converted shall be deemed converted into shares of Common Stock; and (ii) the Holder’s rights as a holder of such converted shares of Series C Preferred Stock shall cease and terminate, excepting only the right to
receive certificates for such shares of Common Stock and to any remedies provided herein or otherwise available at law or in equity to such Holder because of a failure by the Corporation to comply with the terms of this Certificate of Designation.
In all cases, the holder shall retain all of its rights and remedies for the Corporation’s failure to convert Series C Preferred Stock. 

Section 7.    Certain Adjustments. 

(a)    Stock Dividends and Stock Splits. If the Corporation, at any time while this Series C Preferred Stock is outstanding:
(A) pays a stock dividend or otherwise makes a distribution or distributions payable in shares of Common Stock (which, for avoidance of doubt, shall not include any shares of Common Stock issued by the Corporation upon conversion of this Series
C Preferred Stock) with respect to the then outstanding shares of Common Stock; (B) subdivides outstanding shares of Common Stock into a larger number of shares; or (C) combines (including by way of a reverse stock split) outstanding
shares of Common Stock into a smaller number of shares, then the Conversion Ratio shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock (excluding any treasury shares of the Corporation) outstanding
immediately after such event and of which the denominator shall be the number of shares of Common Stock outstanding immediately before such event (excluding any treasury shares of the Corporation). Any adjustment made pursuant to this
Section 7(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 or combination. 
 (b)    Fundamental Transaction. If, at any time while this Series C Preferred Stock is
outstanding, (A) the Corporation effects any merger or consolidation of the Corporation with or into another Person or any stock sale to, or other business combination (including, without limitation, a reorganization, recapitalization, spin-off, share exchange or scheme of arrangement) with or into another Person (other than such a transaction in which the Corporation is the surviving or continuing entity and its Common Stock is not exchanged for
or converted into other securities, cash or property), (B) the Corporation effects any sale of all or substantially all of its assets in one transaction or a series of related transactions, (C) any tender offer or exchange offer (whether by the
Corporation or another Person) is completed pursuant to which more than 50% of the Common Stock not held by the Corporation or such Person is exchanged for or converted into other securities, cash or property, or (D) the Corporation effects any
reclassification of the Common Stock or any compulsory share exchange pursuant (other than as a result of a dividend, subdivision or combination covered by Section 7(a) above) to which the 

  
 11 

 
Common Stock is effectively converted into or exchanged for other securities, cash or property (in any such case, a “Fundamental Transaction”), then, upon any subsequent
conversion of this Series C Preferred Stock the Holders shall have the right to receive, in lieu of the right to receive Conversion Shares, for each Conversion Share that would have been issuable upon such conversion immediately prior to the
occurrence of such Fundamental Transaction, the same kind and amount of securities, cash or property as it would have been entitled to receive upon the occurrence of such Fundamental Transaction if it had been, immediately prior to such Fundamental
Transaction, the holder of one share of Common Stock (the “Alternate Consideration”). For purposes of any such subsequent conversion, the determination of the Conversion Ratio shall be appropriately adjusted to apply to such
Alternate Consideration based on the amount of Alternate Consideration issuable in respect of one share of Common Stock in such Fundamental Transaction, and the Corporation shall adjust the Conversion Ratio in a reasonable manner reflecting the
relative value of any different components of the Alternate Consideration. If holders of Common Stock are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then the Holders shall be given the same
choice as to the Alternate Consideration it receives upon any conversion of this Series C Preferred Stock following such Fundamental Transaction. To the extent necessary to effectuate the foregoing provisions, any successor to the Corporation or
surviving entity in such Fundamental Transaction shall file a new Certificate of Designation with the same terms and conditions and issue to the Holders new preferred stock consistent with the foregoing provisions and evidencing the Holders’
right to convert such preferred stock into Alternate Consideration. The terms of any agreement to which the Corporation is a party and pursuant to which a Fundamental Transaction is effected shall include terms requiring any such successor or
surviving entity to comply with the provisions of this Section 7(b) and insuring that this Series C Preferred Stock (or any such replacement security) will be similarly adjusted upon any subsequent transaction analogous to a Fundamental
Transaction. The Corporation shall cause to be delivered to each Holder, at its last address as it shall appear upon the stock books of the Corporation, written notice of any Fundamental Transaction at least 20 calendar days prior to the date on
which such Fundamental Transaction is expected to become effective or close. 
 (c)    Calculations. All calculations under this
Section 7 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 7, 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 any treasury shares of the Corporation) issued and outstanding. 
 (d)    Notice
to the Holders. 
  

	 	(i)	 Adjustment to Conversion Ratio. Whenever the Conversion Ratio is adjusted pursuant to any provision of
this Section 7, the Corporation shall promptly deliver to each Holder a notice setting forth the Conversion Ratio after such adjustment and setting forth a brief statement of the facts requiring such adjustment. 

 

	 	(ii)	 Other Notices. If (A) the Corporation shall declare a dividend (or any other distribution in
whatever form) on the Common Stock, (B) the Corporation shall declare a special nonrecurring cash dividend on or a redemption of the Common Stock, (C) the Corporation shall authorize the granting to all holders of the

  
 12 

	 	
Common Stock of 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 Corporation shall be
required in connection with any reclassification of the Common Stock, any consolidation or merger to which the Corporation is a party, any sale or transfer of all or substantially all of the assets of the Corporation, or any compulsory share
exchange whereby the Common Stock is converted into other securities, cash or property, or (E) the Corporation shall authorize the voluntary or involuntary dissolution, liquidation or winding up of the affairs of the Corporation, then, in each
case, the Corporation shall cause to be filed at each office or agency maintained for the purpose of conversion of this Series C Preferred Stock, and shall cause to be delivered to each Holder at its last address as it shall appear upon the stock
books of the Corporation, 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. 

Section 8.    Miscellaneous. 

(a)    Redemption. The Series C Preferred Stock is not redeemable. 

(b)    Notices. Any and all notices or other communications or deliveries to be provided by the Holders hereunder including,
without limitation, any Notice of Conversion, shall be in writing and delivered personally, sent electronically (with confirmation of receipt), or sent by a nationally recognized overnight courier service, addressed to the Corporation, at 675
Massachusetts Ave., 14th Floor, Cambridge, MA 02139, Attention President and CEO, or such other address as the Corporation may specify for such purposes by notice to the Holders delivered in accordance with this Section. Any and all notices or other
communications or deliveries to be provided by the Corporation hereunder shall be in writing and delivered personally, by facsimile, email, or sent by a nationally recognized overnight courier service addressed to each Holder at the facsimile
number, email address or mailing address of such Holder appearing on the books of the Corporation, or if no such facsimile number, email address, or mailing address appears on the books of the Corporation, at the principal place of business of such
Holder. Any notice or other communication or deliveries hereunder shall be deemed given and effective on the earliest of: (i) the date of transmission, if such notice or communication is delivered via facsimile or email prior to 5:30 p.m. (New
York City time) on any date, (ii) the date immediately following the date of transmission, if such notice or communication is delivered via facsimile or email between 5:30 p.m. and 11:59 p.m. (New York City time) on any

  
 13 

 
date, (iii) the second Business Day following the date of mailing, if sent by nationally recognized overnight courier service, or (iv) upon actual receipt by the party to whom such
notice is required to be given. 
 (c)    Lost or Mutilated Series C Preferred Stock Certificate. If a Holder’s Series C
Preferred Stock certificate shall be mutilated, lost, stolen or destroyed, the Corporation shall execute and deliver, in exchange and substitution for and upon cancellation of a mutilated certificate, or in lieu of or in substitution for a lost,
stolen or destroyed certificate, a new certificate for the shares of Series C Preferred Stock so mutilated, lost, stolen or destroyed, but only upon receipt of evidence of such loss, theft or destruction of such certificate, and of the ownership
thereof, reasonably satisfactory to the Corporation and, in each case, customary and reasonable indemnity, if requested. Applicants for a new certificate under such circumstances shall also comply with such other reasonable regulations and
procedures and pay such other reasonable third-party costs as the Corporation may prescribe. 
 (d)    Waiver. Any waiver by the
Corporation or a Holder of a breach of any provision of this Certificate of Designation shall not operate as or be construed to be a waiver of any other breach of such provision or of any breach of any other provision of this Certificate of
Designation or a waiver by any other Holders. The failure of the Corporation or a Holder to insist upon strict adherence to any term of this Certificate of Designation on one or more occasions shall not be considered a waiver or deprive that party
(or any other Holder) of the right thereafter to insist upon strict adherence to that term or any other term of this Certificate of Designation. Any waiver by the Corporation or a Holder must be in writing. Notwithstanding any provision in this
Certificate of Designation to the contrary, any provision contained herein and any right of the Holders of Series C Preferred Stock granted hereunder may be waived as to all shares of Series C Preferred Stock (and the Holders thereof) upon the
written consent of the Holders of not less than a majority of the shares of Series C Preferred Stock then outstanding, unless a higher percentage is required by the DGCL, in which case the written consent of the Holders of not less than such higher
percentage shall be required. 
 (e)    Severability. If any provision of this Certificate of Designation is invalid, illegal or
unenforceable, the balance of this Certificate of Designation shall remain in effect, and if any provision is inapplicable to any Person or circumstance, it shall nevertheless remain applicable to all other Persons and circumstances. If it shall be
found that any interest or other amount deemed interest due hereunder violates the applicable law governing usury, the applicable rate of interest due hereunder shall automatically be lowered to equal the maximum rate of interest permitted under
applicable law. 
 (f)    Next Business Day. Whenever any payment or other obligation hereunder shall be due on a day other than
a Business Day, such payment shall be made on the next succeeding Business Day. 
 (g)    Headings. The headings contained herein
are for convenience only, do not constitute a part of this Certificate of Designation and shall not be deemed to limit or affect any of the provisions hereof. 

  
 14 

 (h)    Status of Converted Series C Preferred Stock. If any shares of Series C
Preferred Stock shall be converted or reacquired by the Corporation, such shares shall resume the status of authorized but unissued shares of preferred stock and shall no longer be designated as Series C Preferred Stock. 

******************** 
 IN WITNESS WHEREOF, the
undersigned has executed this Certificate of Designation this                      day of
                    , 2020. 
  

			
	By:	 	  

		 	 Ankit Mahadevia, M.D.,
 President and Chief
Executive Officer

  
 15 

 ANNEX A 

NOTICE OF CONVERSION 
 (TO BE
EXECUTED BY THE REGISTERED HOLDER 
 IN ORDER TO CONVERT SHARES OF SERIES C PREFERRED STOCK) 

The undersigned Holder hereby irrevocably elects to convert the number of shares of Series C Preferred Stock indicated below, [represented by stock
certificate No(s).                 (the “Preferred Stock Certificates”)] [represented in book-entry form], into shares of common stock, par value
$.001 per share (the “Common Stock”), of Spero Therapeutics, Inc., a Delaware corporation (the “Corporation”), as of the date written below. If securities are to be issued in the name of a person other
than the undersigned, the undersigned will pay all transfer taxes payable with respect thereto. Capitalized terms utilized but not defined herein shall have the meaning ascribed to such terms in that certain Certificate of Designation of
Preferences, Rights and Limitations of Series C Convertible Preferred Stock (the “Certificate of Designation”) filed by the Corporation with the Secretary of State of the State of Delaware on
                    , 2020. 
 As of the date hereof,
the number of shares of Common Stock beneficially owned by the undersigned Holder (together with such Holder’s Affiliates, and any other Person whose beneficial ownership of Common Stock would be aggregated with the Holder’s for purposes
of Section 13(d) or Section 16 of the Exchange Act and the applicable regulations of the Commission, including any “group” of which the Holder is a member (the foregoing, “Attribution Parties”)), including
the number of shares of Common Stock issuable upon conversion of the Series C Preferred Stock subject to this Notice of Conversion, but excluding the number of shares of Common Stock which are issuable upon (A) conversion of the remaining,
unconverted Series C Preferred Stock beneficially owned by such Holder or any of its Attribution Parties, and (B) exercise or conversion of the unexercised or unconverted portion of any other securities of the Corporation (including any
warrants) beneficially owned by such Holder or any of its Attribution Parties that are subject to a limitation on conversion or exercise similar to the limitation contained in Section 6(c) of the Certificate of Designation, is
[    ]%. For purposes hereof, beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act and the applicable regulations of the Commission. In addition, for purposes hereof,
“group” has the meaning set forth in Section 13(d) of the Exchange Act and the applicable regulations of the Commission. 
 Conversion
calculations: 
  

			
	 Date to Effect Conversion:
	 	  

		
	 Number of shares of Series C Preferred
Stock owned prior to Conversion:
	 	  
  

		
	 Number of shares of Series C Preferred
Stock to be Converted:
	 	  
  

		
	 Number of shares of Common Stock to be
Issued:
	 	  

 

  
 Annex A – Page 1

			
		
	 Address for delivery of physical
certificates:
	 	  
  

		
	 or
	 	
		
	 for DWAC Delivery:
	 	  

		
	 DWAC Instructions:
	 	  

		
	 Broker no:
	 	  

		
	 Account no:
	 	  

  

					
		  	    HOLDER
			
		  	        By:	  	  

		  	        Name:	  	  

		  	        Title:	  	  

		  	        Date:	  	  

  
 Annex A – Page 2

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