Document:

Exhibit 10.1

 

COMMON STOCK
PURCHASE AGREEMENT

 

COMMON STOCK PURCHASE AGREEMENT
(the “Agreement”), dated as of March 22, 2017 by and between IMMUNE PHARMACEUTICALS INC., a Delaware
corporation (the “Company”), and HLHW IV, LLC, a Delaware limited liability company (the “Buyer”). Capitalized
terms used herein and not otherwise defined herein are defined in Section 10 hereof.

 

WHEREAS: 

 

Subject to the terms and conditions set
forth in this Agreement, the Company wishes to sell to the Buyer, and the Buyer wishes to buy from the Company, up to One Million
Six Hundred Thousand Dollars ($1,600,000) of the Company’s common stock, par value $0.0001 per share (the “Common
Stock”). The shares of Common Stock to be purchased hereunder are referred to herein as the “Purchase Shares.”

 

NOW THEREFORE, the Company and the
Buyer hereby agree as follows:

 

	 	1.	PURCHASE OF COMMON STOCK.

 

Subject to the terms and conditions set
forth in this Agreement, on the day following the filing of the Form 8-K as described in Section 4 herein (“Effective
Date”), the Company has the right to sell to the Buyer, and the Buyer has the obligation to purchase from the Company,
Purchase Shares. The purchase and sale of Purchase Shares hereunder shall occur from time to time upon written notices by the Company
to the Buyer on the terms and conditions as set forth herein following the satisfaction of the conditions (the “Commencement”)
as set forth in Sections 6 and 7 below (the date of satisfaction of such conditions, the “Commencement Date”).

 

(a) The Company’s Right to Require
Regular Purchases. Subject to item (d) below and the terms and conditions of this Agreement, on any given Business Day
after the Commencement Date, the Company shall have the right but not the obligation to direct the Buyer by its delivery to the
Buyer of a Purchase Notice from time to time, and the Buyer thereupon shall have the obligation, to buy the number of Purchase
Shares specified in such notice, up to 500,000 Purchase Shares, on such Business Day (as long as such notice is delivered on or
before 9:00 a.m. Eastern time on such Business Day), unless delivery of a Purchase Notice is waived by Buyer in its sole discretion
(each such purchase, a “Regular Purchase”) at the Purchase Price on the Purchase Date; however, in no event
shall the Purchase Amount of a Regular Purchase exceed Two Hundred and Fifty Thousand Dollars ($250,000) per Business Day, unless
the Buyer and the Company mutually agree. The Company and the Buyer may mutually agree to increase the number of Purchase
Shares that may be sold pursuant to a Regular Purchase to as much as an additional 2,000,000 Purchase Shares per Business Day.
The Company may deliver additional Purchase Notices to the Buyer from time to time so long as the most recent purchase has been
completed. The share amounts in this Section 1(b) shall be appropriately adjusted for any reorganization, recapitalization,
non-cash dividend, stock split, reverse stock split or other similar transaction. Unless waived by the Buyer, the Company is prohibited
from requesting Regular and/or Additional Purchases for five (5) Business Days from the Commencement Date.

 

(b) Additional Purchases. Subject
to item (d) below and the terms and conditions of this Agreement, in addition to purchases of Purchase Shares as described in Section
1(b) above, with one Business Day’s prior written notice, the Company shall also have the right but not the obligation to
direct the Buyer by delivery to the Buyer of an Additional Purchase Notice from time to time, and the Buyer thereupon shall have
the obligation, to buy up to an additional 30% of the trading volume of the Common Stock for the next Business Day (each such purchase,
an “Additional Purchase”) at the Additional Purchase Price. The Company may deliver an Additional Purchase
Notice to the Buyer on or before 9:00 a.m. Eastern time on a date on which (i) the Company also submitted a Purchase Notice for
a Regular Purchase of at least 200,000 Purchase Shares to the Buyer and (ii) the Additional Purchase Price is higher than the Floor
Price. The share amount in the prior sentence shall be appropriately adjusted for any reorganization, recapitalization, non-cash
dividend, stock split, reverse stock split or other similar transaction.  Upon completion of each Additional Purchase,
the Buyer shall submit to the Company a confirmation of the Additional Purchase in form and substance reasonably acceptable to
the Company. The Company may deliver Additional Purchase Notices to the Buyer from time to time so long as the most recent
purchase has been completed.

 

(c) Limitation on Purchases. In
the event the Company delivers a Purchase Notice or Additional Purchase Notice to Buyer for more than thirty percent (30%) of the
average of the five (5) previous Business Days dollar volume of the Common Stock on the Trading Market on which the Common Stock
is then listed or quoted as reported by Bloomberg L.P. based on a Trading Day from 9:30 AM (NYC time) to 4:02 PM (NYC time) for
the nearest preceding Business Day (“Volume Limitation”), the Buyer, in its sole discretion, may either accept
or reject the Purchase Notice or Additional Purchase Notice, in whole or in part. Furthermore, provided the Company can deliver
the Purchase Shares or Additional Purchase Shares via DWAC, the Company shall be obligated to require Regular Purchases and/or
Additional Purchases for an aggregate number of Purchase Shares and/or Additional Purchase Shares representing a dollar value of
an aggregate amount of not less than $1,000,000 per month, subject to the Volume Limitation. Upon failure of the Company to comply
with its obligation to sell to Buyer a number of Purchase Shares with an aggregate value of at least $1,000,000, the Company will
pay to the Buyer as liquidated damages the sum of $50,000 for each thirty (30) day period such failure continues. If for any reason
the Transfer Agent does not timely deliver the Shares via DWAC, Buyer, in its sole discretion, may then cancel the Purchase and
the Company will be required to pay Buyer as liquidated damages, and not as a penalty the sum of $5,000. If the Buyer elects not
to cancel the Purchase Notice and/or an Additional Purchase Notice, the Company will pay to the Buyer as liquidated damages the
sum of $5,000 per day until the Transfer Agent delivers the Purchase Shares to Buyer. In the event the Principal Market is closed
or there is no trading in the Common Stock or trading has been halted for any reason whatsoever, Buyer, in its sole discretion,
may reject a part of or all of the Purchase Notice or Additional Purchase Notice.

 

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(d) Payment for Purchase Shares. For
each Regular Purchase, the Buyer shall pay to the Company an amount equal to the Purchase Amount minus any amounts or credits whatsoever
due to Buyer, as full payment for such Purchase Shares via wire transfer of immediately available funds on or before the fourth
Business Day following delivery of the Purchase Shares to Buyer. For each Additional Purchase, the Buyer shall pay to the
Company an amount equal to the Additional Purchase Amount minus any amounts or credits whatsoever due to Buyer, as full payment
for such Additional Purchase Shares via wire transfer of immediately available funds on or before the fourth Business Day following
the delivery of Additional Purchase Shares to Buyer. All payments made under this Agreement shall be made in lawful money
of the United States of America via wire transfer of immediately available funds to such account as the Company may from time to
time designate by written notice in accordance with the provisions of this Agreement. Whenever any amount expressed to be
due by the terms of this Agreement is due on any day that is not a Business Day, the same shall instead be due on the next succeeding
day that is a Business Day. Failure to deliver the Purchase Shares or Additional Purchase Shares within three Business Days of
the Purchase Date or Additional Purchase Date, the Company will pay Buyer as liquidated damages, and not as a penalty, an amount
in cash equal to five percent (5%) of the value of the Purchase Shares or Additional Purchase Shares, as the case may be, based
on the Closing Bid Price of the Common stock for each such day until the Purchase Shares or Additional Purchase Shares, as the
case may be, are delivered to Buyer.

 

(e) Purchase Price Floor. The
Company and the Buyer shall not effect any sales under this Agreement on any Purchase Date where the Purchase Price is less than
the Floor Price. “Floor Price” means the consolidated closing bid price per share on the Nasdaq Capital
Market immediately preceding the entering into of this Common Stock Purchase Agreement. If the transaction is entered into during
market hours, before the close of the regular session at 4PM Eastern Time, the previous day’s consolidated closing bid price
is used.  If the transaction is entered into after the close of the regular session, then that day's consolidated closing
bid price is used. The Floor Price shall be appropriately adjusted for any reorganization, recapitalization, non-cash dividend,
stock split, reverse stock split or other similar transaction.

 

(f) Records of Purchases. The
Buyer and the Company shall each maintain records showing the remaining Available Amount at any given time and the dates and Purchase
Amounts for each purchase, or shall use such other method reasonably satisfactory to the Buyer and the Company to reconcile the
remaining Available Amount.

 

(g) Taxes. The Company shall
pay any and all transfer, stamp or similar taxes that may be payable with respect to the issuance and delivery of any shares of
Common Stock to the Buyer made under this Agreement.

 

(h) Compliance with Principal Market
Rules. Notwithstanding anything in this Agreement to the contrary, unless permitted by the applicable rules and regulations
of the Principal Market, the total number of shares of Common Stock that may be issued under this Agreement, shall not exceed the
aggregate number of shares of Common Stock which the Company may issue upon without breaching the Company’s obligations under
the rules or regulations of the Principal Market (the number of shares which may be issued without violating such rules and regulations,
the “Exchange Cap”). Notwithstanding the foregoing, such limitation shall not apply in the event that the Company
obtains the approval of its stockholders as required by the applicable rules of the Principal Market for issuances of shares of
Common Stock in excess of such amount the Exchange Cap shall be appropriately adjusted for any reorganization, recapitalization,
non-cash dividend, stock split, reverse stock split or other similar transaction.  The Company may, in its sole discretion,
determine whether to obtain stockholder approval to issue more shares of Common Stock hereunder than is permitted by the Exchange
Cap if such issuance would require stockholder approval under the rules or regulations of the Principal Market.

 

(i) Beneficial Ownership Limitation.
The Company shall not issue, and the Buyer shall not purchase any shares of Common Stock under this Agreement, if such shares proposed
to be issued and sold, when aggregated with all other shares of Common Stock then owned beneficially (as calculated pursuant to
Section 13(d) of the Securities Exchange Act of 1934, as amended (the “1934 Act”) and Rule 13d-3 promulgated
thereunder) by the Buyer and its affiliates would result in the beneficial ownership by the Buyer and its affiliates of more than
4.99% of the then issued and outstanding shares of Common Stock of the Company, unless waived in writing by Buyer.

 

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	 	2.	BUYER’S REPRESENTATIONS AND WARRANTIES. 

 

The Buyer represents and warrants to the
Company that as of the date hereof and as of the Commencement Date:

 

(a) Investment Purpose. The
Buyer is entering into this Agreement and acquiring the Purchase Shares (the Purchase Shares are referred to herein as the “Securities”),
for its own account for investment only and not with a view towards, or for resale in connection with, the public sale or distribution
thereof; provided however, by making the representations herein, the Buyer does not agree to hold any of the Securities for any
minimum or other specific term.

 

(b) Accredited Investor Status. The
Buyer is an “accredited investor” as that term is defined in Rule 501(a)(3) of Regulation D under the 1933 Act.

 

(c) Information. The Buyer
has been furnished with all materials relating to the business, finances and operations of the Company and materials relating to
the offer and sale of the Securities that have been reasonably requested by the Buyer, including, without limitation, the SEC Documents
(as defined in Section 3(f) hereof). The Buyer understands that its investment in the Securities involves a high degree of
risk. The Buyer (i) is able to bear the economic risk of an investment in the Securities including a total loss, (ii) has
such knowledge and experience in financial and business matters that it is capable of evaluating the merits and risks of the proposed
investment in the Securities and (iii) has had an opportunity to ask questions of and receive answers from the officers of the
Company concerning the financial condition and business of the Company and other matters related to an investment in the Securities. Neither
such inquiries nor any other due diligence investigations conducted by the Buyer or its representatives shall modify, amend or
affect the Buyer’s right to rely on the Company’s representations and warranties contained in Section 3 below. The
Buyer has sought such accounting, legal and tax advice as it has considered necessary to make an informed investment decision with
respect to its acquisition of the Securities.

 

(d) No Governmental Review. The
Buyer understands that no United States federal or state agency or any other government or governmental agency has passed on or
made any recommendation or endorsement of the Securities or the fairness or suitability of the investment in the Securities nor
have such authorities passed upon or endorsed the merits of the offering of the Securities.

 

(e) Organization. The Buyer is a
limited liability company duly organized and validly existing in good standing under the laws of the jurisdiction in which it is
organized, and has the requisite organizational power and authority to own its properties and to carry on its business as now being
conducted.

 

(f) Validity; Enforcement. This
Agreement has been duly and validly authorized, executed and delivered on behalf of the Buyer and is a valid and binding agreement
of the Buyer enforceable against the Buyer in accordance with its terms, subject as to enforceability to (i) general principles
of equity and to applicable bankruptcy, insolvency, reorganization, moratorium, liquidation and other similar laws relating to,
or affecting generally, the enforcement of applicable creditors’ rights and remedies and (ii) public policy underlying any
law, rule or regulation (including any federal or state securities law, rule or regulation) with regards to indemnification, contribution
or exculpation. The execution and delivery of the Transaction Documents (as defined in Section 3(b) hereof) by the Buyer and the
consummation by it of the transactions contemplated hereby and thereby do not conflict with the Buyer’s certificate of organization
or operating agreement or similar documents, and do not require further consent or authorization by the Buyer, its managers or
its members.

 

(g) Residency. The Buyer is
a resident of the State of Delaware.

 

(h) No Prior Short Selling. The
Buyer represents and warrants to the Company that at no time prior to the date of this Agreement has any of the Buyer, its agents,
representatives or affiliates engaged in or effected, in any manner whatsoever, directly or indirectly, any (i) “short sale”
(as such term is defined in Section 242.200 of Regulation SHO of the 1934 Act) of the Common Stock or (ii) hedging transaction,
which establishes a net short position with respect to the Common Stock.

 

	 	3.	REPRESENTATIONS AND WARRANTIES OF THE COMPANY. 

 

Except as set forth herein or in the Schedules,
the Company represents and warrants to the Buyer that as of the date hereof and as of the Commencement Date:

 

(a) Organization and Qualification. The
Company and its “Subsidiaries” (which for purposes of this Agreement means any entity in which the Company,
directly or indirectly, owns more than 50% of the voting stock or capital stock or other similar equity interests) are corporations
or limited liability companies duly organized and validly existing in good standing under the laws of the jurisdiction in which
they are incorporated or organized, and have the requisite corporate or organizational power and authority to own their properties
and to carry on their business as now being conducted. Each of the Company and its Subsidiaries is duly qualified as a foreign
corporation or limited liability company to do business and is in good standing in every jurisdiction in which its ownership of
property or the nature of the business conducted by it makes such qualification necessary, except to the extent that the failure
to be so qualified or be in good standing would not reasonably be expected to have a Material Adverse Effect. As used in this
Agreement, “Material Adverse Effect” means any material adverse effect on any of: (i) the business, properties,
assets, operations, results of operations or financial condition of the Company and its Subsidiaries, if any, taken as a whole,
or (ii) the authority or ability of the Company to perform its obligations under the Transaction Documents (as defined in Section
3(b) herein). The Company has no material Subsidiaries except as set forth on Schedule 3(a).

 

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(b) Authorization; Enforcement; Validity. (i)
The Company has the requisite corporate power and authority to enter into and perform its obligations under this Agreement, and
each of the other agreements entered into by the parties on the Commencement Date and attached hereto as exhibits to this Agreement
(collectively, the “Transaction Documents”), and to issue the Securities in accordance with the terms hereof
and thereof, (ii) the execution and delivery of the Transaction Documents by the Company and the consummation by it of the transactions
contemplated hereby and thereby, including without limitation, the reservation for issuance and the issuance of the Purchase Shares
and Additional Purchase Shares issuable under this Agreement, have been duly authorized by the Company’s Board of Directors
or duly authorized committee thereof, do not conflict with the Company’s Certificate of Incorporation or Bylaws (as defined
below), and do not require further consent or authorization by the Company, its Board of Directors, except as set forth in this
Agreement, or its stockholders, (iii) this Agreement has been, and each other Transaction Document shall be on the Commencement
Date, duly executed and delivered by the Company and (iv) this Agreement constitutes, and each other Transaction Document upon
its execution on behalf of the Company, shall constitute, the valid and binding obligations of the Company enforceable against
the Company in accordance with their terms, except as such enforceability may be limited by (y) general principles of equity or
applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or similar laws relating to, or affecting generally,
the enforcement of creditors’ rights and remedies and (z) public policy underlying any law, rule or regulation (including
any federal or state securities law, rule or regulation) with regards to indemnification, contribution or exculpation. The
Board of Directors of the Company or a duly authorized committee thereof has approved the resolutions (the “Signing Resolutions”)
substantially in the form as set forth as Exhibit B attached hereto to authorize this Agreement and the transactions contemplated
hereby. The Signing Resolutions are valid, in full force and effect and have not been modified or supplemented in any material
respect. The Company has delivered to the Buyer a true and correct copy of the Signing Resolutions as approved by the Board
of Directors of the Company.

 

(c) Capitalization. As of the
date hereof, the authorized capital stock of the Company consists of (i) 225,000,000 shares of Common Stock, par value $0.0001,
of which as of the date hereof, 184,476,315 shares are issued and outstanding, zero shares are held as treasury shares, 642,373
shares are reserved for future issuance pursuant to the Company’s 2015 Equity Incentive Plan, of which approximately 642,373
shares remain available for future option grants or stock awards, exercisable or exchangeable for, or convertible into, shares
of Common Stock, and (ii) zero shares of Series C or Series D preferred stock, with per share liquidation preferences set forth
on Schedule 3(c), of which as of the date hereof zero shares are issued and outstanding. All of such outstanding shares have
been, or upon issuance will be, validly issued and are fully paid and non-assessable. Except as disclosed in Schedule 3(c)
or the first sentence of this Section 3(c), (i) no shares of the Company’s capital stock are subject to preemptive rights
or any other similar rights or any liens or encumbrances suffered or permitted by the Company, (ii) there are no outstanding debt
securities of the Company or any of its Subsidiaries, (iii) there are no outstanding options, warrants, scrip, rights to subscribe
to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into, any shares of capital
stock of the Company or any of its Subsidiaries, or contracts, commitments, understandings or arrangements by which the Company
or any of its Subsidiaries is or may become bound to issue additional shares of capital stock of the Company or any of its Subsidiaries
or options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities
or rights convertible into, any shares of capital stock of the Company or any of its Subsidiaries, (iv) there are no material agreements
or arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of their securities
under the 1933 Act (except the Registration Rights Agreement), (v) there are no outstanding securities or instruments of the Company
or any of its Subsidiaries which contain any redemption or similar provisions, and there are no contracts, commitments, understandings
or arrangements by which the Company or any of its Subsidiaries is or may become bound to redeem a security of the Company or any
of its Subsidiaries, (vi) there are no securities or instruments containing anti-dilution or similar provisions that will be triggered
by the issuance of the Securities as described in this Agreement and (vii) the Company does not have any stock appreciation rights
or “phantom stock” plans or agreements or any similar plan or agreement. The Company has furnished or made available
to the Buyer true and correct copies of the Company’s Certificate of Incorporation, as amended and as in effect on the date
hereof (the “Certificate of Incorporation”), and the Company’s Bylaws, as amended and as in effect on
the date hereof (the “Bylaws”).

 

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(d) Issuance of Securities. 
The Purchase Shares have been duly authorized and, upon issuance in accordance with the terms hereof, the Purchase Shares and Additional
Purchase Shares shall be (i) validly issued, fully paid and non-assessable and (ii) free from all taxes, liens and charges with
respect to the issuance thereof. Upon issuance and payment therefore in accordance with the terms and conditions of this Agreement,
the Purchase Shares and Additional Purchase Shares shall be validly issued, fully paid and non-assessable and free from all taxes,
liens and charges with respect to the issue thereof, with the holders being entitled to all rights accorded to a holder of Common
Stock.

 

(e) No Conflicts. Except as
disclosed in Schedule 3(e), the execution, delivery and performance of the Transaction Documents by the Company and the consummation
by the Company of the transactions contemplated hereby and thereby (including, without limitation, the reservation for issuance
and issuance of the Purchase Shares) will not (i) result in a violation of the Certificate of Incorporation, any Certificate of
Designations, Preferences and Rights of any outstanding series of preferred stock of the Company or the Bylaws or (ii) conflict
with, or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give to
others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture or instrument to which the
Company or any of its Subsidiaries is a party, or result, to the Company’s knowledge, in a violation of any law, rule, regulation,
order, judgment or decree (including federal and state securities laws and regulations and the rules and regulations of the Principal
Market applicable to the Company or any of its Subsidiaries) or by which any property or asset of the Company or any of its Subsidiaries
is bound or affected, except in the case of conflicts, defaults, terminations, amendments, accelerations, cancellations and violations
under clause (ii), which would not reasonably be expected to result in a Material Adverse Effect. Except as disclosed in Schedule
3(e), neither the Company nor its Subsidiaries is in violation of any term of or in default under its Certificate of Incorporation,
any Certificate of Designation, Preferences and Rights of any outstanding series of preferred stock of the Company or the Bylaws
or their organizational charter or bylaws, respectively. Except as disclosed in Schedule 3(e), neither the Company nor any
of its Subsidiaries is in violation of any term of or is in default under any material contract, agreement, mortgage, indebtedness,
indenture, instrument, judgment, decree or order or any statute, rule or regulation applicable to the Company or its Subsidiaries,
except for possible violations, defaults, terminations or amendments that would not reasonably be expected to have a Material Adverse
Effect. The business of the Company and its Subsidiaries is not being conducted, and shall not be conducted, in violation
of any law, ordinance, or regulation of any governmental entity, except for possible violations, the sanctions for which either
individually or in the aggregate would not reasonably be expected to have a Material Adverse Effect. Except as specifically
contemplated by this Agreement, reporting obligations under the 1934 Act, or as required under the 1933 Act or applicable state
securities laws or the filing of a Listing of Additional Shares Notification Form with the Principal Market, the Company is not
required to obtain any consent, authorization or order of, or make any filing or registration with, any court or governmental agency
or any regulatory or self-regulatory agency in order for it to execute, deliver or perform any of its obligations under or contemplated
by the Transaction Documents in accordance with the terms hereof or thereof. Except as disclosed in Schedule 3(e) and for
reporting obligations under the 1934 Act, all consents, authorizations, orders, filings and registrations which the Company is
required to obtain pursuant to the preceding sentence shall be obtained or effected on or prior to the Commencement Date. Except
as disclosed in Schedule 3(e), the Company is not subject to any notices or actions from or to the Principal Market other than
routine matters incident to listing on the Principal Market and not involving a violation of the rules of the Principal Market. Except
as disclosed in Schedule 3(e), to the Company’s knowledge, the Principal Market has not commenced any delisting proceedings
against the Company.

 

(f) SEC Documents; Financial Statements.
Except as disclosed in Schedule 3(f), since January 1, 2017, the Company has filed all reports, schedules, forms, statements and
other documents required to be filed by it with the SEC pursuant to the reporting requirements of the 1934 Act (all of the foregoing
filed prior to the date hereof and all exhibits included therein and financial statements and schedules thereto and documents incorporated
by reference therein being hereinafter referred to as the “SEC Documents”). As of their respective dates
(except as they have been correctly amended), the SEC Documents complied in all material respects with the requirements of the
1934 Act and the rules and regulations of the SEC promulgated thereunder applicable to the SEC Documents, and none of the SEC Documents,
at the time they were filed with the SEC (except as they may have been properly amended), contained any untrue statement of a material
fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading. As of their respective dates (except as they have been
properly amended), the financial statements of the Company included in the SEC Documents complied as to form in all material respects
with applicable accounting requirements and the published rules and regulations of the SEC with respect thereto. Such financial
statements have been prepared in accordance with generally accepted accounting principles, consistently applied, during the periods
involved (except (i) as may be otherwise indicated in such financial statements or the notes thereto or (ii) in the case of unaudited
interim statements, to the extent they may exclude footnotes or may be condensed or summary statements) and fairly present in all
material respects the financial position of the Company as of the dates thereof and the results of its operations and cash flows
for the periods then ended (subject, in the case of unaudited statements, to normal year-end audit adjustments). Except as
disclosed in Schedule 3(f) or routine correspondence, such as comment letters and notices of effectiveness in connection with previously
filed registration statements or periodic reports publicly available on EDGAR, to the Company’s knowledge, the Company or
any of its Subsidiaries are not presently the subject of any inquiry, investigation or action by the SEC.

 

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(g) Absence of Certain Changes. Except
as disclosed in Schedule 3(g), since January 1, 2017, there has been no material adverse change in the business, properties, operations,
financial condition or results of operations of the Company or its Subsidiaries taken as a whole. For purposes of this Agreement,
neither a decrease in cash or cash equivalents or in the market price of the Common Stock nor losses incurred in the ordinary course
of the Company’s business shall be deemed or considered a material adverse change. The Company has not taken any steps,
and does not currently expect to take any steps, to seek protection pursuant to any Bankruptcy Law nor does the Company or any
of its Subsidiaries have any knowledge or reason to believe that its creditors intend to initiate involuntary bankruptcy or insolvency
proceedings. The Company is financially solvent and is generally able to pay its debts as they become due.

 

(h) Absence of Litigation. Except
as disclosed in Schedule 3(h), to the Company’s knowledge, there is no action, suit, proceeding, inquiry or investigation
before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the
Company or any of its Subsidiaries, threatened against the Company, the Common Stock or any of the Company’s Subsidiaries
or any of the Company’s or the Company’s Subsidiaries’ officers or directors in their capacities as such, which
would reasonably be expected to have a Material Adverse Effect (each, an “Action”). 

 

(i) Acknowledgment Regarding Buyer’s
Status. The Company acknowledges and agrees that the Buyer is acting solely in the capacity of arm’s length purchaser
with respect to the Transaction Documents and the transactions contemplated hereby and thereby. The Company further acknowledges
that the Buyer is not acting as a financial advisor or fiduciary of the Company (or in any similar capacity) with respect to the
Transaction Documents and the transactions contemplated hereby and thereby and any advice given by the Buyer or any of its representatives
or agents in connection with the Transaction Documents and the transactions contemplated hereby and thereby is merely incidental
to the Buyer’s purchase of the Securities. The Company further represents to the Buyer that the Company’s decision
to enter into the Transaction Documents has been based solely on the independent evaluation by the Company and its representatives
and advisors.

 

(j) Intellectual Property Rights. To
the Company’s knowledge, the Company and its Subsidiaries own or possess adequate rights or licenses to use all material
trademarks, trade names, service marks, service mark registrations, service names, patents, patent rights, copyrights, inventions,
licenses, approvals, governmental authorizations, trade secrets and other intellectual property rights (collectively, “Intellectual
Property”) necessary to conduct their respective businesses as now conducted, except as set forth in Schedule 3(j) or
to the extent that the failure to own, possess, license or otherwise hold adequate rights to use Intellectual Property would not,
individually or in the aggregate, have a Material Adverse Effect. Except as disclosed in Schedule 3(j), to the Company’s
knowledge, none of the Company’s active and registered Intellectual Property have expired or terminated, or, by the terms
and conditions thereof, will expire or terminate within two years from the date of this Agreement, except as would not reasonably
be expected to have a Material Adverse Effect. The Company and its Subsidiaries do not have any knowledge of any infringement
by the Company or its Subsidiaries of any Intellectual Property of others and, except as set forth on Schedule 3(j), there is no
claim, action or proceeding being made or brought against, or to the Company’s knowledge, being threatened against, the Company
or its Subsidiaries regarding Intellectual Property, which could reasonably be expected to have a Material Adverse Effect.

 

(k) Environmental Laws. To
the Company’s knowledge, the Company and its Subsidiaries (i) are in material compliance with any and all applicable foreign,
federal, state and local laws and regulations relating to the protection of human health and safety or the environment and with
respect to hazardous or toxic substances or wastes, pollutants or contaminants (“Environmental Laws”), (ii)
have received all material permits, licenses or other approvals required of them under applicable Environmental Laws to conduct
their respective businesses and (iii) are in material compliance with all terms and conditions of any such permit, license or approval,
except where, in each of the three foregoing clauses, the failure to so comply or receive such approvals would not reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect.

 

(l) Title. The Company and
its Subsidiaries have good and marketable title to all personal property owned by them that is material to the business of the
Company and its Subsidiaries, in each case free and clear of all liens, encumbrances and defects except such as are described in
Schedule 3(l) or such as do not materially affect the value of such property and do not interfere with the use made and proposed
to be made of such property by the Company and any of its Subsidiaries or would not reasonably be expected to have, individually
or in the aggregate, a Material Adverse Effect. Any real property and facilities held under lease by the Company and any of
its Subsidiaries, to the Company’s knowledge, are held by them under valid, subsisting and enforceable leases with such exceptions
as are not material and do not interfere with the use made and proposed to be made of such property and buildings by the Company
and its Subsidiaries.

 

    6 

     

    

 

(m) Insurance. The Company
and each of its Subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in
such amounts as management of the Company believes to be reasonable and customary in the businesses in which the Company and its
Subsidiaries are engaged. To the Company’s knowledge, since January 1, 2017, neither the Company nor any such Subsidiary
has been refused any insurance coverage sought or applied for and neither the Company nor any such Subsidiary, to the Company’s
knowledge, will be unable to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage
from similar insurers as may be necessary to continue its business at a cost that would not reasonably be expected to have a Material
Adverse Effect.

 

(n) Regulatory Permits. The
Company and its Subsidiaries possess all material certificates, authorizations and permits issued by the appropriate federal, state
or foreign regulatory authorities necessary to conduct their respective businesses as currently conducted, and neither the Company
nor any such Subsidiary has received any written notice of proceedings relating to the revocation or modification of any such material
certificate, authorization or permit.

 

(o) Tax Status. The Company
and each of its Subsidiaries has made or filed all federal and state income and all other material tax returns, reports and declarations
required by any jurisdiction to which it is subject (unless and only to the extent that the Company and each of its Subsidiaries
has set aside on its books reserves reasonably adequate for the payment of all unpaid and unreported taxes or filed valid extensions)
and has paid all taxes and other governmental assessments and charges that are material in amount, shown or determined to be due
on such returns, reports and declarations, except those being contested in good faith and has set aside on its books reserves reasonably
adequate for the payment of all taxes for periods subsequent to the periods to which such returns, reports or declarations apply. To
the Company’s knowledge, there are no unpaid taxes in any material amount claimed to be due by the taxing authority of any
jurisdiction.

 

(p) Transactions With Affiliates. Except
as set forth on Schedule 3(p) and other than the grant or exercise of stock options or any other equity securities offered pursuant
to duly adopted stock or incentive compensation plans as disclosed on Schedule 3(c) or in the first sentence of Section 3(c),
none of the officers, directors or employees of the Company is presently a party to any transaction with the Company or any of
its Subsidiaries (other than for services as employees, officers and directors and reimbursement for expenses incurred on behalf
of the Company), including any contract, agreement or other arrangement providing for the furnishing of services to or by, providing
for rental of real or personal property to or from, or otherwise requiring payments to or from any officer, director or such employee
or, to the knowledge of the Company, any corporation, partnership, trust or other entity in which any officer, director, or any
such employee has a material interest or is an officer, director, trustee or general partner.

 

(q) Application of Takeover Protections. The
Company and its board of directors have taken or will take prior to the Commencement Date all necessary action, if any, in order
to render inapplicable any control share acquisition, business combination, poison pill (including any distribution under a rights
agreement) or other similar anti-takeover provision under the Certificate of Incorporation or the laws of the state of its incorporation,
other than Section 203 of the Delaware General Corporation Law, which is or could become applicable to the Buyer as a result of
the transactions contemplated by this Agreement, including, without limitation, the Company’s issuance of the Securities
and the Buyer’s ownership of the Securities.

 

(r) Registration Statement. The
Shelf Registration Statement (as defined in Section 4(a) hereof) has been declared effective by the SEC, and no stop order has
been issued or is pending or, to the knowledge of the Company, threatened by the SEC with respect thereto. As of the date
hereof, the Company has a dollar amount of securities registered and unsold under the Shelf Registration Statement, which is not
less than the sum of the Available Amount.

 

	 	4.	COVENANTS AND OTHER AGREEMENTS OF THE PARTIES. 

 

(a) Filing of Form 8-K and Prospectus
Supplement. The Company agrees that it shall, within one day of the Commencement Date, file a Current Report on Form 8-K
disclosing this Agreement and the transaction contemplated hereby. From and after the filing of the Form 8-K, the Company represents
to the Purchasers that it shall have publicly disclosed all material, non-public information delivered to any of the Purchasers
by the Company or any Subsidiary, or any of their respective officers, directors, employees or agents in connection with the transactions
contemplated by the Transaction Documents. The Company shall file within two (2) Business Days from the date hereof a prospectus
supplement to the Company’s existing shelf registration statement on Form S-3 (File No. 333-198647, the “Shelf Registration
Statement”) covering the sale of the Purchase Shares (the “Prospectus Supplement”). The Company
shall use commercially reasonable efforts to keep the Shelf Registration Statement and any New Registration Statement effective
pursuant to Rule 415 promulgated under the 1933 Act and available for sales of all Securities to the Buyer until such time as (i)
it no longer qualifies to make sales under the Shelf Registration Statement (which shall be understood to include the inability
of the Company to immediately register sales of Securities to the Buyer under the Shelf Registration Statement or any New Registration
Statement pursuant to General Instruction I.B.6 of Form S-3), (ii) the date on which all the Securities have been sold under this
Agreement and no Available Amount remains thereunder, or (iii) the Agreement has been terminated. The Shelf Registration Statement
(including any amendments or supplements thereto and prospectuses or prospectus supplements, including the Prospectus Supplement,
contained therein) shall not contain any untrue statement of a material fact or omit to state a material fact required to be stated
therein, or necessary to make the statements therein, in light of the circumstances in which they were made, not misleading.

 

    7 

     

    

 

(b) Blue Sky. The Company shall
take such action, if any, as is reasonably necessary in order to obtain an exemption for or to qualify (i) the initial sale of
the Securities to the Buyer under this Agreement and (ii) any subsequent sale of the Securities by the Buyer, in each case, under
applicable securities or “Blue Sky” laws of the states of the United States in such states as is reasonably requested
by the Buyer from time to time, and shall provide evidence of any such action so taken to the Buyer.

 

(c) Listing. The Company shall
promptly secure the listing of all of the Company’s Common Stock listed upon each national securities exchange and automated
quotation system that requires an application by the Company for listing, if any, upon which shares of Common Stock are then listed
(subject to official notice of issuance) and shall maintain such listing, so long as any other shares of Common Stock shall be
so listed. The Company shall use its commercially reasonable efforts to maintain the Common Stock’s listing on the Principal
Market. Neither the Company nor any of its Subsidiaries shall take any action that would be reasonably expected to result
in the delisting or suspension of the Common Stock on the Principal Market, unless the Common Stock is immediately thereafter traded
on the New York Stock Exchange, the NYSE MKT, the NASDAQ Global Select Market, the NASDAQ Capital Market, or the OTCQB or OTCQX
market places of the OTC Markets. The Company shall pay all fees and expenses in connection with satisfying its obligations
under this Section.

 

(d) Limitation on Short Sales and Hedging
Transactions. The Buyer agrees that beginning on the date of this Agreement and ending on the date of termination of this
Agreement as provided in Section 11(k), the Buyer and its agents, representatives and affiliates shall not in any manner whatsoever
enter into or effect, directly or indirectly, any (i) “short sale” (as such term is defined in Section 242.200 of Regulation
SHO of the 1934 Act) of the Common Stock or (ii) hedging transaction, which establishes a net short position with respect to the
Common Stock.

 

(e) Commitment Fee. In connection
with the Commencement, the Company shall pay to the Buyer in one or more tranches, at the sole discretion of Buyer, as consideration
for the Buyer entering into this Agreement a cash Commitment Fee in a dollar amount equal to $230,167. The Commitment Fee
shall be paid within five (5) Business Days of the filing of the Prospectus Supplement. If the Commitment Fee is not received
within five (5) Business Days of the filing of the Prospectus Supplement, the Company shall pay to Buyer all outstanding amounts
in cash, including but not limited to, liquidated damages of $5,000 per day until the Commitment Fee is paid.

 

(f) Due Diligence. The Buyer
shall have the right, from time to time as the Buyer may reasonably deem appropriate, to perform reasonable due diligence on the
Company during normal business hours and subject to reasonable prior notice to the Company. The Company and its officers and
employees shall provide information and reasonably cooperate with the Buyer in connection with any reasonable request by the Buyer
related to the Buyer’s due diligence of the Company, including, but not limited to, any such request made by the Buyer in
connection with (i) the filing of the prospectus supplement described in Section 4(a) hereof and (ii) the Commencement; provided,
however, that at no time is the Company permitted to disclose material nonpublic information to the Buyer or breach any obligation
of confidentiality or non-disclosure to a third party or make any disclosure that could cause a waiver of attorney-client privilege. Each
party hereto agrees not to disclose any Confidential Information of the other party to any third party and shall not use the Confidential
Information of such other party for any purpose other than in connection with, or in furtherance of, the transactions contemplated
hereby. Each party hereto acknowledges that the Confidential Information shall remain the property of the disclosing party
and agrees that it shall take all reasonable measures to protect the secrecy of any Confidential Information disclosed by the other
party.

 

(g) Offering Restrictions. For a
period of ninety (90) days from the date hereof, the Company is prohibited from discussing, negotiating, agreeing to or entering
into any similar At The Market or equity line type of transactions.

 

	 	5.	TRANSFER AGENT INSTRUCTIONS. 

 

All of the Purchase Shares to be issued
under this Agreement shall be issued without any restrictive legend and as DWAC Shares unless the Buyer expressly consents otherwise. The
Company shall issue irrevocable instructions to the Transfer Agent, and any subsequent transfer agent, to issue Common Stock in
the name of the Buyer for the Purchase Shares (the “Irrevocable Transfer Agent Instructions”). The Company
warrants to the Buyer that no instruction other than the Irrevocable Transfer Agent Instructions referred to in this Section 5,
will be given by the Company to the Transfer Agent with respect to the Purchase Shares and the Purchase Shares shall otherwise
be freely transferable on the books and records of the Company as and to the extent provided in this Agreement and the Registration
Rights Agreement.

 

    8 

     

    

 

	 	6.	CONDITIONS TO THE COMPANY’S RIGHT TO COMMENCE SALES OF SHARES OF COMMON STOCK UNDER THIS AGREEMENT. 

 

The right of the Company hereunder to commence
sales of the Purchase Shares is subject to the satisfaction of each of the following conditions on or before the Commencement Date
(the date that the Company may begin sales of Purchase Shares):

 

(a) The Buyer shall have executed each
of the Transaction Documents and delivered the same to the Company;

 

(b) The representations and warranties
of the Buyer shall be true and correct as of the Commencement Date as though made at that time (except for representations and
warranties that speak as of a specific date, which shall be true and correct in all material respects as of such specific date)
and the Buyer shall have performed, satisfied and complied in all material respects with the covenants and agreements required
by this Agreement to be performed, satisfied or complied with by the Buyer at or prior to the Commencement Date, and the Company
shall have received a certificate, executed by a duly authorized officer of the Buyer, dated as of the Commencement Date, to the
foregoing effect; and

 

(c) The Prospectus Supplement shall have
been delivered to the Buyer and no stop order with respect to the registration statement covering the sale of shares to the Buyer
shall be pending or threatened by the SEC.

 

	 	7.	CONDITIONS TO THE BUYER’S OBLIGATION TO MAKE PURCHASES OF SHARES OF COMMON STOCK. 

 

The obligation of the Buyer to buy Purchase
Shares under this Agreement is subject to the satisfaction of each of the following conditions on or before the Commencement Date
(the date that the Company may begin sales of Purchase Shares) and once such conditions have been initially satisfied, there shall
be an ongoing obligation to continue to satisfy such conditions after the Commencement has occurred:

 

(a) The Company shall have executed each
of the Transaction Documents and delivered the same to the Buyer;

 

(b) The Company shall have paid to the
Buyer the Commitment Fee;

 

(c) The Common Stock shall be authorized
for quotation on the Principal Market, trading in the Common Stock shall not have been within the last 365 days suspended by the
SEC or the Principal Market, other than a general halt in trading in the Common Stock by the Principal Market under halt codes
indicating pending or released material news, and the Securities shall be approved for listing upon the Principal Market;

 

(d) The Buyer shall have received the opinion
of the Company’s legal counsel dated as of the Commencement Date in customary form and substance;

 

(e) The representations and warranties
of the Company shall be true and correct in all material respects (except to the extent that any of such representations and warranties
is already qualified as to materiality in Section 3 above, in which case, such representations and warranties shall be true and
correct without further qualification) as of the date of this Agreement and as of the Commencement Date as though made at that
time (except for representations and warranties that speak as of a specific date, which shall be true and correct in all material
respects as of such specific date) and the Company shall have performed, satisfied and complied in all material respects with the
covenants, agreements and conditions required by the Transaction Documents to be performed, satisfied or complied with by the Company
at or prior to the Commencement Date. The Buyer shall have received a certificate, executed by the CEO, President or CFO of
the Company, dated as of the Commencement Date, to the foregoing effect in the form attached hereto as Exhibit A;

 

(f) The Board of Directors of the Company
or a duly authorized committee thereof shall have adopted resolutions substantially in the form attached hereto as Exhibit B
which shall be in full force and effect without any amendment or supplement thereto as of the Commencement Date;

 

(g) As of the Commencement Date, the Company
shall have reserved out of its authorized and unissued Common Stock, solely for the purpose of effecting future purchases of Purchase
Shares hereunder, 25,000,000 shares of Common Stock;

 

(h) The Irrevocable Transfer Agent Instructions,
in form acceptable to the Buyer shall have been delivered to and acknowledged in writing by the Company and the Buyer and have
been delivered to the Transfer Agent;

 

    9 

     

    

 

(i) The Company shall have delivered to
the Buyer a certificate evidencing the incorporation and good standing of the Company in the State of Delaware issued by the Secretary
of State of the State of Delaware as of a date within ten (10) Business Days of the Commencement Date;

 

(j) The Company shall have delivered to
the Buyer a secretary’s certificate executed by the Secretary of the Company, dated as of the Commencement Date, in the form
attached hereto as Exhibit C;

 

(k) The Shelf Registration Statement shall
have been declared effective under the 1933 Act by the SEC and no stop order with respect thereto shall be pending or threatened
by the SEC. The Company shall have prepared and delivered to the Buyer a final and complete form of prospectus supplement,
dated and current as of the Commencement Date, to be used in connection with any issuances of any Purchase Shares to the Buyer,
and to be filed by the Company within two (2) Business Days after the Commencement Date pursuant to Rule 424(b). The Company
shall have made all filings under all applicable federal and state securities laws necessary to consummate the issuance of the
Purchase Shares pursuant to this Agreement in compliance with such laws;

 

(l) No Event of Default has occurred and
is continuing, or any event which, after notice and/or lapse of time, would become an Event of Default has occurred;

 

(m) On or prior to the Commencement Date,
the Company shall take all necessary action, if any, and such actions as reasonably requested by the Buyer, in order to render
inapplicable any control share acquisition, business combination, stockholder rights plan or poison pill (including any distribution
under a rights agreement) or other similar anti-takeover provision under the Certificate of Incorporation or the laws of the state
of its incorporation, other than Section 203 of the Delaware General Corporation Law, that is or could become applicable to the
Buyer as a result of the transactions contemplated by this Agreement, including, without limitation, the Company’s issuance
of the Securities and the Buyer’s ownership of the Securities; and

 

(n) The Company shall have provided the
Buyer with the information reasonably requested by the Buyer in connection with its due diligence requests made prior to, or in
connection with, the Commencement, in accordance with the terms of Section 4(f) hereof.

  

	 	8.	INDEMNIFICATION.

 

In consideration of the Buyer’s execution
and delivery of the Transaction Documents and acquiring the Securities hereunder and in addition to all of the Company’s
other obligations under the Transaction Documents, the Company shall defend, protect, indemnify and hold harmless the Buyer and
all of its affiliates, members, officers, directors, and employees, and any of the foregoing person’s agents or other representatives
(including, without limitation, those retained in connection with the transactions contemplated by this Agreement) (collectively,
the “Indemnitees”) from and against any and all actions, causes of action, suits, claims, losses, costs, penalties,
fees, liabilities and damages, and expenses in connection therewith (irrespective of whether any such Indemnitee is a party to
the action for which indemnification hereunder is sought), and including reasonable attorneys’ fees and disbursements (the
“Indemnified Liabilities”), incurred by any Indemnitee as a result of, or arising out of, or relating to (a)
any misrepresentation or breach of any representation or warranty made by the Company in the Transaction Documents or any other
certificate, instrument or document contemplated hereby or thereby, (b) any breach of any covenant, agreement or obligation of
the Company contained in the Transaction Documents or any other certificate, instrument or document contemplated hereby or thereby,
or (c) any cause of action, suit or claim brought or made against such Indemnitee and arising out of or resulting from the execution,
delivery, performance or enforcement of the Transaction Documents or any other certificate, instrument or document contemplated
hereby or thereby, other than with respect to Indemnified Liabilities which directly and primarily result from (A) a breach of
any of the Buyer’s representations and warranties, covenants or agreements contained in this Agreement, or (B) the gross
negligence, bad faith or willful misconduct of the Buyer or any other Indemnitee. To the extent that the foregoing undertaking
by the Company may be unenforceable for any reason, the Company shall make the maximum contribution to the payment and satisfaction
of each of the Indemnified Liabilities which is permissible under applicable law.

 

	 	9.	EVENTS OF DEFAULT.

 

An “Event of Default”
shall be deemed to have occurred at any time as any of the following events occurs:

 

(a) during any period in which the effectiveness
of any registration statement is required to be maintained pursuant to the terms of the Registration Rights Agreement, the effectiveness
of such registration statement lapses for any reason (including, without limitation, the issuance of a stop order) or is unavailable
to the Company for sale of all of the Registrable Securities to the Buyer in accordance with the terms of the Registration Rights
Agreement, and such lapse or unavailability continues for a period of ten (10) consecutive calendar days or for more than an aggregate
of thirty (30) calendar days in any 365-day period, which is not in connection with a post-effective amendment to any such registration
statement or the filing of a new registration statement; provided, however, that in connection with any post-effective amendment
to such registration statement or filing of a new registration statement that is required to be declared effective by the SEC,
such lapse or unavailability may continue for a period of no more than thirty (30) consecutive calendar days, which such period
shall be extended for an additional thirty (30) calendar days if the Company receives a comment letter from the SEC in connection
therewith;

 

    10 

     

    

 

(b) the suspension from trading or failure
of the Common Stock to be listed on a Principal Market for a period of three (3) consecutive Business Days;

 

(c) the delisting of the Common Stock from
the Principal Market, and the Common Stock is not immediately thereafter trading on the New York Stock Exchange, the NYSE MKT,
the NASDAQ Global Select Market, the NASDAQ Global Market, the NASDAQ Capital Market, the OTC Bulletin Board or the OTCQB marketplace
or OTCQX marketplace of the OTC Markets Group;

 

(d) the failure for any reason by the Transfer
Agent to issue Purchase Shares to the Buyer within three (3) Business days after the applicable Purchase Date that the Buyer is
entitled to receive;

 

(e) the Company’s breach of any representation
or warranty (as of the dates made), covenant or other term or condition under any Transaction Document if such breach would reasonably
be expected to have a Material Adverse Effect and except, in the case of a breach of a covenant which is reasonably curable, only
if such breach continues uncured for a period of at least five (5) Business Days;

 

(f) if any Person commences a proceeding
against the Company pursuant to or within the meaning of any Bankruptcy Law;

 

(g) if the Company pursuant to or within
the meaning of any Bankruptcy Law; (A) commences a voluntary case, (B) consents to the entry of an order for relief against it
in an involuntary case, (C) consents to the appointment of a Custodian of it or for all or substantially all of its property, (D)
makes a general assignment for the benefit of its creditors or (E) becomes insolvent;

 

(h) a court of competent jurisdiction enters
an order or decree under any Bankruptcy Law that (A) is for relief against the Company in an involuntary case, (B) appoints a Custodian
of the Company or for all or substantially all of its property, or (C) orders the liquidation of the Company or any Subsidiary;

 

(i) if at any time after the Commencement
Date, the Exchange Cap is reached unless and until stockholder approval is obtained pursuant to Section 1(h) hereof. The Exchange
Cap shall be deemed to be reached at such time if, upon submission of a Purchase Notice or Additional Purchase Notice under this
Agreement, the issuance of such shares of Common Stock would exceed the number of shares of Common Stock which the Company may
issue under this Agreement without breaching the Company’s obligations under the rules or regulations of the Principal Market;

 

(j) a default by the Company of a material
term, covenant, warranty or undertaking of any agreement to which the Company is a party to; or

 

(k) failure of the Company to publicly
disclose within one business day any material default described in Section 9(j) above.

 

In addition to any other rights and remedies under applicable
law and this Agreement, including the Buyer termination rights under Section 11(k) hereof, so long as an Event of Default has occurred
and is continuing, or if any event which, after notice and/or lapse of time, would become an Event of Default, has occurred and
is continuing, or so long as the Purchase Price is below the Floor Price, the Company may not require and the Buyer shall not be
obligated to purchase any shares of Common Stock under this Agreement. If pursuant to or within the meaning of any Bankruptcy
Law, the Company commences a voluntary case or any Person commences a proceeding against the Company, a Custodian is appointed
for the Company or for all or substantially all of its property, or the Company makes a general assignment for the benefit of its
creditors, (any of which would be an Event of Default as described in Sections 9(f), 9(g) and 9(h) hereof) this Agreement shall
automatically terminate without any liability or payment to the Company without further action or notice by any Person. No
such termination of this Agreement under Section 11(k)(i) shall affect the Company’s or the Buyer’s obligations under
this Agreement with respect to pending purchases and the Company and the Buyer shall complete their respective obligations with
respect to any pending purchases under this Agreement.

 

    11 

     

    

 

In addition to any other rights and remedies under applicable
law and this Agreement, including the Buyer termination rights under Section 11(k) hereof, upon the occurrence of an Event of Default,
the Company will pay to Buyer as liquidated damages and not as a penalty the sum of $250,000 in cash.

 

	 	10.	CERTAIN DEFINED TERMS.

 

For purposes of this Agreement, the following
terms shall have the following meanings:

 

(a) “1933 Act” means
the Securities Act of 1933, as amended.

 

(b) Intentionally Omitted.

 

(c) “Additional Purchase Amount”
means, with respect to any particular Additional Purchase Notice, the portion of the Available Amount to be purchased by the Buyer
pursuant to Section 1(c) hereof pursuant to a valid Additional Purchase Notice which requires the Buyer to buy the additional Purchase
Shares.

 

(d) “Additional Purchase Date”
means, with respect to any Additional Purchase made hereunder, the same Business Day following the receipt by the Buyer of a valid
Additional Purchase Notice that the Buyer is to buy Purchase Shares pursuant to Section 1(c) hereof, provided such valid Additional
Purchase Notice is delivered no later than 9:00 a.m. Eastern Time on such Business Day. If delivered later than 9:00 a.m. Eastern
Time, the Additional Purchase Date will be the next Business Day, unless waived by Buyer, in its sole discretion.

 

(e) Intentionally Omitted.

 

(f) Intentionally Omitted.

 

(g) “Additional Purchase Price”
the lowest intra-day bid price of the Common Stock on the Additional Purchase Date.

 

(h) Intentionally Omitted.

 

(i) Intentionally Omitted.

 

(j) “Available Amount”
means One Million Six Hundred Thousand One Hundred Dollars ($1,600,000) in the aggregate which amount shall be reduced by the Purchase
Amount (including the Initial Purchase) each time the Buyer purchases shares of Common Stock pursuant to Section 1 hereof.

 

(k) “Bankruptcy Law”
means Title 11, U.S. Code, or any similar federal or state law for the relief of debtors.

 

(l) “Business Day” means
any day on which the Principal Market is open for trading during normal trading hours (i.e., 9:30 a.m. to 4:00 p.m. Eastern Time),
including any day on which the Principal Market is open for trading for a period of time less than the customary time.

 

(m) “Closing Bid Price”
means the consolidated closing bid price for the Common Stock on the Principal Market as reported by the Principal Market.

 

(n) “Confidential Information”
means any information disclosed by either party to the other party, either directly or indirectly, in writing, orally or by inspection
of tangible objects (including, without limitation, documents, prototypes, samples, protocols, development plans, commercialization
plans, compounds, formulations, preclinical study and clinical trial results, plant and equipment), which is designated as “Confidential,”
“Proprietary” or some similar designation. Information communicated orally shall be considered Confidential Information
if such information is expressly identified as Confidential Information at the time of such initial disclosure and confirmed in
writing as being Confidential Information within ten (10) Business Days after the initial disclosure. Confidential Information
may also include information disclosed to a disclosing party by third parties. Confidential Information shall not, however, include
any information which (i) was publicly known and made generally available in the public domain prior to the time of disclosure
by the disclosing party; (ii) becomes publicly known and made generally available after disclosure by the disclosing party to the
receiving party through no action or inaction of the receiving party; (iii) is already in the possession of the receiving party
at the time of disclosure by the disclosing party as shown by the receiving party’s files and records immediately prior to
the time of disclosure; (iv) is obtained by the receiving party from a third party without a breach of such third party’s
obligations of confidentiality; (v) is independently developed by the receiving party without use of or reference to the disclosing
party’s Confidential Information, as shown by documents and other competent evidence in the receiving party’s possession;
or (vi) is required by law to be disclosed by the receiving party, provided that the receiving party gives the disclosing party
prompt written notice of such requirement prior to such disclosure and assistance in obtaining an order protecting the information
from public disclosure.

 

(o) “Custodian” means
any receiver, trustee, assignee, liquidator or similar official under any Bankruptcy Law.

 

    12 

     

    

 

(p) “DTC” means the
Depository Trust Company, or any successor performing substantially the same function for the Company.

 

(q) “DWAC Shares” means
shares of Common stock that are (i) issued in electronic form, (ii) freely tradable and transferable and without restriction on
resale, and (iii) timely credited by the Company to the Buyer or its designee’s specified Deposit of Withdrawal at Custodian
(“DWAC”) account with DTC under its Fast-Automatic Securities Transfer (“FAST”) Program or any similar
program hereafter adopted by DTC performing substantially the same function.

 

(r) “Market Price” shall
mean, (i) shall mean, (i) from 9:30am to 4:00pm Eastern Time of the regular session of any trading day, lowest intra-day bid price
or (ii) if after the close of the regular session on any trading day, then such trading day’s consolidated Closing Bid Price.

 

(s) “Maturity Date”
means the date that is twenty-four (24) months from the Commencement Date.

 

(t) “Person” means an
individual or entity including any limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated
organization and a government or any department or agency thereof.

(u) “Principal Market”
means the Nasdaq Global Market; provided however, that in the event the Company’s Common Stock is ever listed or traded on
the New York Stock Exchange, the NYSE MKT, the NASDAQ Global Select Market, the Nasdaq Global Market, the NASDAQ Capital Market,
the OTC Bulletin Board or either of the OTCQB Marketplace or the OTCQX marketplace of the OTC Markets Group, then the “Principal
Market” shall mean such other market or exchange on which the Company’s Common Stock is then listed or traded.

(v) “Purchase Amount”
means, with respect to any particular purchase made hereunder, the portion of the Available Amount to be purchased by the Buyer
pursuant to Section 1 hereof as set forth in a valid Purchase Notice or Additional Purchase Notice which the Company delivers to
the Buyer.

(w) “Purchase Date”
means with respect to any Regular Purchase made hereunder, the Business Day of receipt by the Buyer of a valid Purchase Notice
that the Buyer is to buy Purchase Shares pursuant to Section 1(b) hereof, provided such valid Purchase Notice is delivered no later
than 9:00 a.m. Eastern Time on such Business Day. If delivered later than 9:00 a.m. Eastern Time, the Purchase Date will be the
next Business Day, unless waived by Buyer, in its sole discretion.

(x) “Purchase Notice”
shall mean an irrevocable written notice from the Company to the Buyer directing the Buyer to buy Purchase Shares pursuant to Section
1(b) hereof as specified by the Company therein at the applicable Purchase Price on the Purchase Date.

(y) “Purchase Price”
shall mean the Market Price (to be appropriately adjusted for any reorganization, recapitalization, non-cash dividend, stock split,
reverse stock split or other similar transaction).

(z) “SEC” means the
United States Securities and Exchange Commission.

(aa) “Transfer Agent”
means the transfer agent of the Company as set forth in Section 11(f) hereof or such other person who is then serving as the transfer
agent for the Company in respect of the Common Stock.

 

	 	11.	MISCELLANEOUS. 

 

(a) Governing Law; Jurisdiction; Jury
Trial. All questions concerning the construction, validity, enforcement and interpretation of the Transaction Documents
shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, 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 and any other Transaction Documents (whether brought against a party
hereto or its respective affiliates, directors, officers, shareholders, partners, members, employees or agents) shall be commenced
exclusively in the state and federal courts sitting in the City of New York. Each party hereby irrevocably submits to the exclusive
jurisdiction of the state and federal courts sitting in the City of New York, Borough of Manhattan for the adjudication of any
dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein (including with respect
to the enforcement of any of the Transaction Documents), and hereby irrevocably waives, and agrees not to assert in any action,
suit 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 the Transaction Documents, then, the prevailing party
in such action, suit 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. IN ANY ACTION, SUIT,
OR PROCEEDING IN ANY JURISDICTION BROUGHT BY ANY PARTY AGAINST ANY OTHER PARTY, THE PARTIES EACH KNOWINGLY AND INTENTIONALLY, TO
THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY, IRREVOCABLY AND EXPRESSLY WAIVES FOREVER TRIAL
BY JURY.

 

    13 

     

    

 

(b) Counterparts. This Agreement
may be executed in two or more identical counterparts, all of which shall be considered one and the same agreement and shall become
effective when counterparts have been signed by each party and delivered to the other party; provided that a facsimile or pdf (or
other electronic reproduction) signature shall be considered due execution and shall be binding upon the signatory thereto with
the same force and effect as if the signature were an original, not a facsimile or pdf (or other electronic reproduction) signature.

 

(c) Headings. The headings
of this Agreement are for convenience of reference and shall not form part of, or affect the interpretation of, this Agreement.

 

(d) Severability. If any provision
of this Agreement shall be invalid or unenforceable in any jurisdiction, such invalidity or unenforceability shall not affect the
validity or enforceability of the remainder of this Agreement in that jurisdiction or the validity or enforceability of any provision
of this Agreement in any other jurisdiction.

 

(e) Entire Agreement. This
Agreement and the Registration Rights Agreement supersede all other prior oral or written agreements between the Buyer, the Company,
their affiliates and persons acting on their behalf with respect to the matters discussed herein, and this Agreement, the other
Transaction Documents and the instruments referenced herein contain the entire understanding of the parties with respect to the
matters covered herein and therein and, except as specifically set forth herein or therein, neither the Company nor the Buyer makes
any representation, warranty, covenant or undertaking with respect to such matters. The Company acknowledges and agrees that
is has not relied on, in any manner whatsoever, any representations or statements, written or oral, other than as expressly set
forth in this Agreement.

 

(f) Notices. Any notices, consents
or other communications required or permitted to be given under the terms of this Agreement must be in writing and will be deemed
to have been delivered: (i) upon receipt, when delivered personally; (ii) upon receipt, when sent by facsimile (provided confirmation
of transmission is mechanically or electronically generated and kept on file by the sending party); (iii) upon receipt, when sent
by electronic message (provided the recipient responds to the message and confirmation of both electronic messages are kept on
file by the sending party); or (iv) one (1) Business Day after timely deposit with a nationally recognized overnight delivery service,
in each case properly addressed to the party to receive the same. The addresses and facsimile numbers for such communications shall
be:

 

	 	If to the Company:	 
	 	 	 	 
	 	 	Immune Pharmaceuticals Inc.
	 	 	430 East 29th Street, Suite 940
	 	 	New York, NY 10016
	 	 	Telephone: 	646-440-9310
	 	 	Facsimile: 	917-398-1922
	 	 	Attention:	Daniel G. Teper, Chief Executive Officer
	 	 	Email: 	Daniel.teper@immunepharma.com
	 	 	 	 
	 	With a copy (which shall not constitute notice) to:
	 	 	 	 
	 	 	Sheppard Mullin Richter & Hampton LLP
	 	 	30 Rockefeller Plaza, New York, NY 10112
	 	 	Telephone: 	212-634-3031
	 	 	Facsimile: 	212-655-1729
	 	 	Attention: 	Richard A. Friedman, ESQ
	 	 	Email: 	Rafriedman@sheppardmullin.com
	 	 	 	 
	 	If to the Buyer:	 
	 	 	 	 
	 	 	HLHW IV, LLC
	 	 	708 Third Avenue, 6th Floor
	 	 	New York, NY 10017

 

    14 

     

    

 

	 	With a copy to (which shall not constitute delivery to the Buyer):
	 	 	 	 
	 	 	Grushko & Mittman, P.C.
	 	 	515 Rockaway Avenue
	 	 	Valley Stream, NY 11581
	 	 	Telephone: 	212-697-9500
	 	 	Facsimile: 	212-697-3575
	 	 	Attention: 	Barbara R. Mittman, Esq.
	 	 	Email: 	barbara@grushkomittman.com
	 	 	 	 
	 	If to the Transfer Agent:
	 	 	 	 
	 	 	VStock Transfer, LLC
	 	 	18 Lafayette Place
	 	 	Woodmere, NY 11598
	 	 	Telephone: 	212-828-8436
	 	 	Facsimile: 	646-536-3179
	 	 	Attention: 	Allison Niccolls
	 	 	Email: 	Allison@vstocktransfer.com

 

or at such other address and/or facsimile number and/or to the
attention of such other person as the recipient party has specified by written notice given to each other party at least one (1)
Business Day prior to the effectiveness of such change. Written confirmation of receipt (A) given by the recipient of such
notice, consent or other communication, (B) mechanically or electronically generated by the sender’s facsimile machine containing
the time, date, and recipient facsimile number, (C) electronically generated by the sender’s electronic mail containing the
time, date and recipient email address or (D) provided by a nationally recognized overnight delivery service, shall be rebuttable
evidence of receipt in accordance with clause (i), (ii), (iii) or (iv) above, respectively.

 

(g) Successors and Assigns. This
Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and assigns. The Company
shall not assign this Agreement or any rights or obligations hereunder without the prior written consent of the Buyer, including
by merger or consolidation; provided, however, that any transaction, whether by merger, reorganization, restructuring, consolidation,
financing or otherwise, whereby the Company remains the surviving entity immediately after such transaction, shall not be deemed
a succession or assignment. The Buyer may not assign its rights or obligations under this Agreement.

 

(h) No Third-Party Beneficiaries. This
Agreement is intended for the benefit of the parties hereto and their respective permitted successors and assigns, and is not for
the benefit of, nor may any provision hereof be enforced by, any other person.

 

(i) Further Assurances. Each
party shall do and perform, or cause to be done and performed, all such further acts and things, and shall execute and deliver
all such other agreements, certificates, instruments and documents, as the other party may reasonably request in order to carry
out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.

 

(j) Termination. This Agreement
may be terminated only as follows:

 

(i) By the Buyer any time an
Event of Default exists without any liability or payment to the Company. However, if pursuant to or within the meaning of any Bankruptcy
Law, the Company commences a voluntary case or any Person commences a proceeding against the Company, a Custodian is appointed
for the Company or for all or substantially all of its property, or the Company makes a general assignment for the benefit of its
creditors, (any of which would be an Event of Default as described in Sections 9(f), 9(g) and 9(h) hereof) this Agreement shall
automatically terminate without any liability or payment to the Company without further action or notice by any Person. No
such termination of this Agreement under this Section 11(k)(i) shall affect the Company’s or the Buyer’s obligations
under this Agreement with respect to pending purchases and the Company and the Buyer shall complete their respective obligations
with respect to any pending purchases under this Agreement.

 

(ii) In the event that the
Commencement shall not have occurred within ten (10) Business Days of the date of this Agreement, due to the failure to satisfy
any of the conditions set forth in Sections 6 and 7 above with respect to the Commencement, either party shall have the option
to terminate this Agreement at the close of business on such date or thereafter without liability of either party to any other
party except as described herein; provided, however, that the right to terminate this Agreement under this Section 11(k)(iii) shall
not be available to either party if such failure to satisfy any of the conditions set forth in Sections 6 and 7 is the result of
a breach of this Agreement by such party or the failure of any representation or warranty of such party included in this Agreement
to be true and correct in all material respects. A termination fee pursuant to this Paragraph (j)(iii) of $250,000 in cash will
be immediately payable by the Company to Buyer.

 

    15 

     

    

 

(iii) At any time after the
Commencement Date, the Company shall have the option to terminate this Agreement for any reason or for no reason by delivering
notice (a “Company Termination Notice”) to the Buyer electing to terminate this Agreement without any liability
whatsoever of either party to the other party under this Agreement except that the Company must transmit to Buyer a Termination
Fee of $250,000 in cash, within two (2) Business Days following delivery of the Company Termination Notice. The Company Termination
Notice shall not be effective until one (1) Business Day after it has been received by the Buyer. If the Termination Fee is not
received within two (2) Business Days following delivery of the Company Termination Notice, the Company will pay the Buyer as liquidated
damages of $5,000 per day in cash, for each day of delay in payment of the Termination Fee together with any applicable legal fees.

 

(iv) This Agreement shall automatically
terminate on the date that the Company sells and the Buyer purchases the full Available Amount as provided herein, without any
action or notice on the part of any party and without any liability whatsoever of any party to any other party under this Agreement.

 

(v) If by the Maturity Date
for any reason or for no reason the full Available Amount under this Agreement has not been purchased as provided for in Section
1 of this Agreement, this Agreement shall automatically terminate on the Maturity Date, without any action or notice on the part
of any party and without any liability whatsoever of any party to any other party under this Agreement.

 

Except as set forth in Sections
11(j)(i) (in respect of an Event of Default under Sections 9(f), 9(g) and 9(h)), 11(j)(v) and 11(j)(vi), any termination of this
Agreement pursuant to this Section 11(j) shall be effected by written notice from the Company to the Buyer, or the Buyer to the
Company, as the case may be, setting forth the basis for the termination hereof. The representations and warranties of the
Company and the Buyer contained in Sections 2, 3 and 5 hereof, the indemnification provisions set forth in Section 8 hereof and
the agreements and covenants set forth in Sections 4(e) and 11, shall survive the Commencement and any termination of this Agreement. No
termination of this Agreement shall affect the Company’s or the Buyer’s rights or obligations (i) under the Registration
Rights Agreement which shall survive any such termination in accordance with its terms or (ii) under this Agreement with respect
to pending purchases and the Company and the Buyer shall complete their respective obligations with respect to any pending purchases
under this Agreement.

 

(k) No Financial Advisor, Placement
Agent, Broker or Finder. The Company represents and warrants to the Buyer that it has not engaged any financial advisor,
placement agent, broker or finder in connection with the transactions contemplated hereby. The Buyer represents and warrants
to the Company that it has not engaged any financial advisor, placement agent, broker or finder in connection with the transactions
contemplated hereby. Each party shall be responsible for the payment of any fees or commissions, if any, of any financial
advisor, placement agent, broker or finder engaged by such party relating to or arising out of the transactions contemplated hereby. Each
party shall pay, and hold the other party harmless against, any liability, loss or expense (including, without limitation, attorneys’
fees and out of pocket expenses) arising in connection with any such claim.

 

(l) No Strict Construction. The
language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent, and no
rules of strict construction will be applied against any party.

 

(m) Failure or Indulgence Not Waiver. No
failure or delay in the exercise of any power, right or privilege hereunder shall operate as a waiver thereof, nor shall any single
or partial exercise of any such power, right or privilege preclude other or further exercise thereof or of any other right, power
or privilege.

 

*      *      *      *    
  *

 

    16 

     

    

 

IN WITNESS WHEREOF, the Buyer and
the Company have caused this Common Stock Purchase Agreement to be duly executed as of the date first written above.

 

	 	THE COMPANY:
	 	 
	 	IMMUNE PHARMACEUTICALS INC.
	 	 	 
	 	By:	 	 
	 	Name: Daniel G. Teper
	 	Title: CEO
	 	
         

         

	 	BUYER:
	 	 
	 	HLHW IV, LLC
	 	 	 
	 	By: 	 	 
	 	Name: 
	 	Title: 

  

    17 

     

    

 

SCHEDULES 

 

	Schedule 3(a)	 	Subsidiaries
	Schedule 3(c)	 	Capitalization
	Schedule 3(e)	 	Conflicts
	Schedule 3(f)	 	1934 Act Filings
	Schedule 3(g)	 	Material Changes
	Schedule 3(h)	 	Litigation

 

EXHIBITS 

 

	Exhibit A	 	Form of Officer’s Certificate
	Exhibit B	 	Form of Resolutions of Board of Directors of the Company
	Exhibit C              	 	Form of Secretary’s Certificate

 

    18 

     

    

 

SCHEDULE 3.1(a)

 

List of Subsidiaries

 

 

	Name of Entity	Jurisdiction of Incorporation	Ownership
	
        Immune Pharmaceuticals Ltd.

         

        Cytovia Inc.

         

        Maxim Pharmaceuticals, Inc.

         

        Immune Pharmaceuticals Corp

         
	
        Israel

         

        Delaware

         

        Delaware

         

        Delaware

         
	
        100%

         

        100%

         

        100%

         

        100%

 

    19 

     

    

 

SCHEDULE 3(c)

 

Capitalization

 

None 

 

2015 Equity Incentive Plan -15,000,000
Shares

 

 

 

 

    20 

     

    

 

Schedule 3(e)

 

None

 

 

 

 

    21 

     

    

 

SCHEDULE 3.1(h)

 

SEC Reports 

 

None.

 

10-K due on or before March 31, 2017.

 

 

 

 

    22 

     

    

 

SCHEDULE 3.1(i)

 

Material Changes

 

 

None

 

    23 

     

    

 

SCHEDULE 3(g)

 

Litigation

 

 

 

As disclosed in the Q-3, 2016 Form 10-Q.

 

 

    24 

     

    

 

EXHIBIT A

 

FORM OF OFFICER’S CERTIFICATE 

 

This Officer’s Certificate (“Certificate”)
is being delivered pursuant to Section 7(e) of that certain Common Stock Purchase Agreement dated as of March 16, 2017 (the “Common
Stock Purchase Agreement”), by and between IMMUNE PHARMACEUTICALS INC., a Delaware corporation (the “Company”),
and HLHW IV, LLC, a Delaware limited liability company (the “Buyer”). Terms used herein and not
otherwise defined shall have the meanings ascribed to them in the Common Stock Purchase Agreement.

 

The undersigned, [REQUIRES COMPLETION],
[REQUIRES COMPLETION] of the Company, hereby certifies as follows:

 

1. I am the [REQUIRES COMPLETION]
of the Company and make the statements contained in this Certificate in my capacity as such;

 

2. The representations and
warranties of the Company are true and correct in all material respects (except to the extent that any of such representations
and warranties is already qualified as to materiality in Section 3 of the Common Stock Purchase Agreement, in which case, such
representations and warranties are true and correct without further qualification) as of the date when made and as of the Commencement
Date as though made at that time (except for representations and warranties that speak as of a specific date);

 

3. The Company has performed,
satisfied and complied in all material respects with covenants, agreements and conditions required by the Transaction Documents
to be performed, satisfied or complied with by the Company at or prior to the Commencement Date.

 

4. The Company has not taken
any steps, and does not currently expect to take any steps, to seek protection pursuant to any Bankruptcy Law nor does the Company
or any of its Subsidiaries have any knowledge or reason to believe that its creditors intend to initiate involuntary bankruptcy
or insolvency proceedings. The Company is financially solvent and is generally able to pay its debts as they become due.

IN WITNESS WHEREOF, I have hereunder signed
my name on this [REQUIRES COMPLETION] day of [REQUIRES COMPLETION], 2017.

 

	 	

	 	Name:
	 	Title:

 

The undersigned as Secretary of IMMUNE
PHARMACEUTICALS INC., a Delaware corporation, hereby certifies that [REQUIRES COMPLETION] is the duly elected, appointed, qualified
and acting [REQUIRES COMPLETION] of the Company and that the signature appearing above is his/her genuine signature.

 

	 	 
	 	

        Secretary

 

    25 

     

    

 

EXHIBIT B

 

FORM OF COMPANY RESOLUTIONS

FOR SIGNING PURCHASE AGREEMENT

 

WHEREAS, management has reviewed with the
Board of Directors the background, terms and conditions of the transactions subject to the Common Stock Purchase Agreement (the
“Purchase Agreement”) by and between the Company and HLHW IV, LLC (“HLHW”), including all
materials terms and conditions of the transactions subject thereto, providing for the purchase by HLHW of up to One Million Six
Hundred Thousand Dollars ($1,600,000) of the Company’s common stock, par value $0.0001 per share (the “Common Stock”);
and

 

Transaction Documents

 

NOW, THEREFORE, BE IT RESOLVED, that the
transactions described in the Purchase Agreement are hereby approved and the Chief Executive Officer, the Principal Financial Officer
of the Company (the “Authorized Officers”) are severally authorized to execute and deliver the Purchase Agreement
in substantially the form attached as Exhibit A hereto, and any other agreements or documents contemplated thereby including,
without limitation, a registration rights agreement (the “Registration Rights Agreement”) in substantially the
form attached as Exhibit B hereto providing for the registration of the issuance and/or sale of shares of Common Stock to
HLHW under the Purchase Agreement, with such amendments, changes, additions and deletions as the Authorized Officers may deem to
be appropriate and approve on behalf of the Company, such approval to be conclusively evidenced by the signature of an Authorized
Officer thereon; and

 

FURTHER RESOLVED, that the terms and provisions
of the Form of Transfer Agent Instructions (the “Instructions”) in substantially the form attached as Exhibit
C hereto are hereby approved and the Authorized Officers are authorized to execute and deliver the Instructions (pursuant to
the terms of the Purchase Agreement), with such amendments, changes, additions and deletions as the Authorized Officers may deem
appropriate and approve on behalf of the Company, such approval to be conclusively evidenced by the signature of an Authorized
Officer thereon; and

 

Issuance of Common Stock

 

FURTHER RESOLVED, that the Company is hereby
authorized to issue shares of Common Stock upon the purchase of Purchase Shares from time to time with an aggregate purchase price
of up to $1,600,000 under the Purchase Agreement, at a price per share equal to or greater than $[REQUIRES COMPLETION], in accordance
with the terms of the Purchase Agreement, provided that the number of shares of Common Stock issued pursuant to the Purchase
Agreement (including all Purchase Shares and Additional Purchase Shares) (the “Purchase Shares” and “Additional
Purchase Shares”, the “HLHW Shares”) shall not exceed 19.99% of the Company’s outstanding shares
of Common Stock as of the date hereof without the affirmative consent of the stockholders; and that, upon issuance of the Purchase
Shares pursuant to the Purchase Agreement, including payment therefor, the Purchase Shares will be duly authorized, validly issued,
fully paid and non-assessable; and

 

FURTHER RESOLVED, that the Company is authorized
to, and hereby does, reserve out of its authorized but unissued shares of Common Stock the maximum number of shares of Common Stock that
is issuable to HLHW under the Purchase Agreement, subject to automatic adjustment from time to time as Purchase Shares are sold
to HLHW; and

 

    26 

     

    

 

Prospectus Supplement

 

FURTHER RESOLVED, that the Authorized Officers
are hereby authorized, in the name and on behalf of the Company:

 

	 	1.	to prepare, execute and file with the Securities and Exchange Commission (the “SEC”) such prospectus supplements, including any preliminary or final prospectus supplement, to the Company’s Registration Statement on Form S-3 on file with the SEC (File No. 333-198647) (the “Shelf S-3 Registration Statement”) and the prospectus included therein and such additional documents, including any free writing prospectuses, as the Authorized Officer so acting may determine, in his or her sole discretion, to be necessary, appropriate or desirable in connection with the transactions pursuant to the Purchase Agreement, such determination to be conclusively evidenced by the execution and filing of such prospectus supplements, prospectuses or additional documents; and 

 

	 	2.	to prepare, execute and file with the SEC one or more additional registration statements on Form S-3 relating to the registration under the Securities Act of any Purchase Shares that were not registered pursuant to the Shelf S-3 Registration Statement, to the extent required pursuant to the Registration Rights Agreement; and 

 

Proceeds

 

FURTHER RESOLVED, that following the sale
of the Purchase Shares, it is the intention of the Company (a) to continue to be primarily engaged in the business of drug
discovery, development and commercialization (the “Company Business”), rather than in the business of
investing or reinvesting in, or owning, holding or trading securities; (b) to employ the proceeds of the sale of the Purchase Shares
in the Company Business; and (c) as soon as is reasonably possible, but in any event within one year from the closing of any sale
of Purchase Shares, to have invested the proceeds of such sale not theretofore expended in the Company Business in a manner consistent
with their preservation for future use in the Company Business and with the Company not being an “investment company”
as defined in the Investment Company Act of 1940, as amended; and

 

FURTHER RESOLVED, that, of the consideration
to be received by the Company for the Purchase Shares, an amount equal to the par value per share sold is hereby determined to
be capital to be allocated on the books of the Company to the Common Stock capital account, and the difference between the aggregate
amount so allocated and the aggregate consideration received for the Purchase Shares shall be credited on the books of the Company
as additional paid-in capital for purposes of financial reporting and as surplus for purposes of the General Corporation Law of
the State of Delaware; and

 

Transfer Agent and Registrar

 

FURTHER RESOLVED, that for the purpose
of the original issuance of the HLHW Shares in accordance with the foregoing resolutions, American Stock Transfer & Trust Company
(the “Transfer Agent”) is hereby authorized to issue, countersign and register such certificates as may be required
for such issuance and to deliver such stock certificates in accordance with the instructions of an Authorized Officer, or to cause
any such HLHW Shares to be delivered through electronic book entry; and that if the Transfer Agent requires a prescribed form of
preambles or resolutions relating to the foregoing, each such preamble or resolution is hereby adopted by the Board, and the Secretary
or any Assistant Secretary of the Company is hereby authorized to certify the adoption of any such preamble or resolution and to
insert all such preambles and resolutions in the minute book of the Company immediately following this resolution; and

 

Listing of Shares on the Nasdaq Capital
Market

 

FURTHER RESOLVED, that the Authorized Officers,
with the assistance of counsel be, and each of them hereby is, authorized and directed to take all necessary steps and do all other
things necessary and appropriate to effect the listing of the HLHW Shares on the Nasdaq Capital Market including, if applicable,
the filing of a Notification Form for Listing of Additional Shares and the payment of any required fees; and

 

State Securities Laws

 

FURTHER RESOLVED, that it is desirable
and in the best interests of the Company that its Common Stock be qualified or registered for sale, to the extent required by law,
in various states and other jurisdictions, and that the Authorized Officers are each hereby authorized and directed to determine
the states and other jurisdictions in which appropriate action shall be taken to (i) qualify or register for sale all or such part
of such Common Stock and (ii) register the Company as a dealer or broker; that the Authorized Officers be, and hereby are, authorized
to perform on behalf of the Company any and all such acts as the officer so acting may deem necessary or advisable in order to
comply with the applicable laws of any such states and other jurisdictions, and in connection therewith to execute, affix the Company’s
seal to and file all requisite papers and documents, including, without limitation, applications, resolutions, reports, surety
bonds, irrevocable consents and appointments of attorneys for service of process; and that execution by any of the Authorized Officers
of any such paper or document or the doing by any of the Authorized Officers of any act in connection with the foregoing matters
shall conclusively establish the authority of the officers so acting therefor from the Company and the approval and ratification
by the Company of the papers and documents so executed and the action so taken; and

 

    27 

     

    

 

FURTHER RESOLVED, that if the securities
or “blue sky” laws of any of the states or other jurisdictions in which any of the Authorized Officers deem it necessary
or advisable to qualify or register for sale all or part of the Common Stock or to register the Company as a dealer or broker,
or any authority administering such laws, requires a prescribed form of preambles or resolutions relating to such sale or to any
application, statement, instrument or other document connected therewith, each such preamble or resolution is hereby adopted by
the Board, and the Secretary or any Assistant Secretary of the Company is hereby authorized to certify the adoption of any such
preamble or resolution to any party who may so request and to insert all such preambles and resolutions in the minute book of the
Company immediately following these resolutions; and

 

Approval of Actions

 

FURTHER RESOLVED, that the Company be and
hereby is authorized to enter into any and all amendments to its agreements with, or obtain any and all waivers from, (i) the holders
of any outstanding securities of the Company and (ii) any other entity, as may be necessary or desirable to effectuate the events
and transactions contemplated by these resolutions; and

 

FURTHER RESOLVED, that, without limiting
the foregoing, the Authorized Officers are, and each of them hereby is, authorized and directed to proceed on behalf of the Company
and to take all such steps as deemed necessary or appropriate, with the advice and assistance of counsel, to cause the Company
to consummate the agreements referred to herein and to perform its obligations under such agreements; and

 

FURTHER RESOLVED, that the Authorized Officers
be, and each of them hereby is, authorized, empowered and directed on behalf of and in the name of the Company, to take or cause
to be taken all such further actions and to execute and deliver or cause to be executed and delivered all such further agreements,
amendments, documents, certificates, reports, schedules, applications, notices, letters and undertakings and to incur and pay all
such fees and expenses as in their judgment shall be necessary, proper or desirable to carry into effect the purpose and intent
of any and all of the foregoing resolutions, and that all actions heretofore taken by any officer or director of the Company in
connection with the transactions contemplated by the agreements described herein are hereby approved, ratified and confirmed in
all respects.

 

    28 

     

    

 

EXHIBIT C

 

FORM OF SECRETARY’S CERTIFICATE

 

This Secretary’s Certificate (the
“Certificate”) is being delivered pursuant to Section 7(k) of that certain Common Stock Purchase Agreement dated
as of [REQUIRES COMPLETION], 2017 (the “Common Stock Purchase Agreement”), by and between IMMUNE PHARMACEUTICALS,
INC., a Delaware corporation (the “Company”) and HLHW IV, LLC, a Delaware limited liability company
(the “Buyer”), pursuant to which the Company may sell to the Buyer up to One Million Six Hundred Thousand Dollars
($1,600,000) of the Company’s Common Stock, par value $0.0001 per share (the “Common Stock”). Terms
used herein and not otherwise defined shall have the meanings ascribed to them in the Common Stock Purchase Agreement.

 

The undersigned, [REQUIRES COMPLETION],
Secretary of the Company, hereby certifies as follows in his capacity as such:

 

1. I am the Secretary of the
Company and make the statements contained in this Secretary’s Certificate.

 

2. Attached hereto as Exhibit
A and Exhibit B are true, correct and complete copies of the Company’s bylaws (“Bylaws”) and Certificate
of Incorporation (“Certificate of Incorporation”), respectively, in each case, as amended through the date hereof,
and no action has been taken by the Company, its directors, officers or stockholders, in contemplation of the filing of any further
amendment relating to or affecting the Bylaws or the Certificate of Incorporation.

 

3. Attached hereto as Exhibit
C are true, correct and complete copies of the resolutions duly adopted by the Board of Directors of the Company on [REQUIRES COMPLETION],
2017 at which a quorum was present and acting throughout. Such resolutions have not been amended, modified or rescinded and
remain in full force and effect and such resolutions are the only resolutions adopted by the Company’s Board of Directors,
or any committee thereof, or the stockholders of the Company relating to or affecting (i) the entering into and performance of
the Common Stock Purchase Agreement, or the issuance, offering and sale of the Purchase Shares and (ii) and the performance of
the Company of its obligation under the Transaction Documents as contemplated therein.

 

4. As of the date hereof, the
authorized, issued and reserved capital stock of the Company is as set forth on Exhibit D hereto.

 

IN WITNESS WHEREOF, I have hereunder
signed my name on this [REQUIRES COMPLETION] day of [REQUIRES COMPLETION].

 

 

	 	

	 	[REQUIRES COMPLETION], Secretary

 

The undersigned as [REQUIRES COMPLETION] of IMMUNE PHARMACEUTICALS
INC., a Delaware corporation, hereby certifies that [REQUIRES COMPLETION] is the duly elected, appointed, qualified and acting
Secretary of the Company, and that the signature appearing above is his/her genuine signature.

 

 

	 	
         

 

    29EX-4.1

 Exhibit 4.1 

[Execution Version] 
  

RIGHTS AGREEMENT 
 between

 ARROWHEAD PHARMACEUTICALS, INC. 

and 
 COMPUTERSHARE TRUST
COMPANY, N.A., 
 as Rights Agent 

Dated as of March 21, 2017 
  

 

 TABLE OF CONTENTS 

 

					
	 	  	Page	 
		
	 Section 1. Certain Definitions
	  	 	1	 
		
	 Section 2. Appointment of the Rights Agent
	  	 	8	 
		
	 Section 3. Issuance of Rights Certificates
	  	 	8	 
		
	 Section 4. Form of Rights Certificates
	  	 	10	 
		
	 Section 5. Countersignature and Registration
	  	 	11	 
		
	 Section 6. Transfer, Split-Up, Combination, and Exchange of Rights Certificates; Mutilated,
Destroyed, Lost, or Stolen Rights Certificates
	  	 	12	 
		
	 Section 7. Exercise of Rights; Purchase Price; Expiration Date of Rights
	  	 	13	 
		
	 Section 8. Cancellation and Destruction of Rights Certificates
	  	 	15	 
		
	 Section 9. Reservation and Availability of Capital Stock
	  	 	15	 
		
	 Section 10. Preferred Stock Record Date
	  	 	17	 
		
	 Section 11. Adjustment of Purchase Price, Number and Kind of Shares, or Number of
Rights
	  	 	17	 
		
	 Section 12. Certificate of Adjusted Purchase Price or Number of Shares
	  	 	25	 
		
	 Section 13. Consolidation, Merger, or Sale or Transfer of Assets or Earning Power
	  	 	25	 
		
	 Section 14. Fractional Rights and Fractional Shares
	  	 	28	 
		
	 Section 15. Rights of Action
	  	 	29	 
		
	 Section 16. Agreement of Rights Holders
	  	 	30	 
		
	 Section 17. Rights Certificate Holder Not Deemed a Stockholder
	  	 	31	 
		
	 Section 18. Concerning the Rights Agent
	  	 	31	 
		
	 Section 19. Merger or Consolidation or Change of Name of the Rights Agent
	  	 	32	 
		
	 Section 20. Duties of the Rights Agent
	  	 	32	 

  
 i 

 TABLE OF CONTENTS 

(Continued) 
  

					
	 	  	Page	 
		
	 Section 21. Change of the Rights Agent
	  	 	35	 
		
	 Section 22. Issuance of New Rights Certificates
	  	 	36	 
		
	 Section 23. Redemption and Termination
	  	 	36	 
		
	 Section 24. Exchange of Rights
	  	 	37	 
		
	 Section 25. Notice of Certain Events
	  	 	39	 
		
	 Section 26. Notices
	  	 	40	 
		
	 Section 27. Supplements and Amendments
	  	 	41	 
		
	 Section 28. Successors
	  	 	41	 
		
	 Section 29. Determinations and Actions by the Board
	  	 	41	 
		
	 Section 30. Benefits of this Agreement
	  	 	42	 
		
	 Section 31. Severability
	  	 	42	 
		
	 Section 32. Governing Law
	  	 	42	 
		
	 Section 33. Counterparts
	  	 	42	 
		
	 Section 34. Descriptive Headings
	  	 	42	 
		
	 Section 35. Force Majeure
	  	 	42	 

  

			
	Exhibit A	 	        Form of Certificate of Designation, Preferences, and Rights
	Exhibit B	 	        Form of Rights Certificate
	Exhibit C	 	        Form of Summary of Rights to Purchase Preferred Stock

  
 ii 

 RIGHTS AGREEMENT 

RIGHTS AGREEMENT, dated as of March 21, 2017 (this “Agreement”), between Arrowhead Pharmaceuticals, Inc. (f/k/a
Arrowhead Research Corporation), a Delaware corporation (the “Company”), and Computershare Trust Company, N.A., a federally chartered trust company (the “Rights Agent”). 

RECITAL 
 WHEREAS, on
March 1, 2017 (the “Rights Dividend Declaration Date”), the Board authorized and declared a dividend distribution of one right (each, a “Right”, and together with all other such rights distributed or issued
pursuant hereto, the “Rights”) for each share of Common Stock outstanding at the Close of Business on March 22, 2017 (the “Record Date”), and further authorized and directed the issuance of one Right (as such
number may hereinafter be adjusted pursuant hereto) with respect to each share of Common Stock issued between the Record Date (whether originally issued or delivered from the Company’s treasury) and, except as otherwise provided in
Section 22 hereof, the earlier of the Distribution Date and the Expiration Date, each Right initially representing the right to purchase one one-thousandth of a share of Preferred Stock, upon the terms and subject to the conditions hereinafter
set forth. 
 AGREEMENT 

NOW, THEREFORE, in consideration of the premises and the mutual agreements herein set forth, the parties hereto hereby agree as follows: 

Section 1. Certain Definitions. For purposes of this Agreement, the following terms have the meanings as indicated below: 

(a)       “Acquiring Person” shall mean any Person who or which, together with all Affiliates
and Associates of such Person, shall be the Beneficial Owner of 15% or more of the Common Stock then outstanding, but shall not include an Exempt Person. Notwithstanding the foregoing: 

(i)       any Person who or which, together with all Affiliates and Associates of such Person, becomes the
Beneficial Owner of 15% or more of the Common Stock then outstanding as a result of a reduction in the number of shares of Common Stock outstanding due to the repurchase of Common Stock by the Company shall not be deemed an “Acquiring
Person”, unless and until such Person, together with all Affiliates and Associates of such Person, acquires Beneficial Ownership of any additional shares of Common Stock (other than as a result of a stock dividend, stock split, or similar
transaction effected by the Company in which all registered holders of Common Stock are treated substantially equally) while the Beneficial Owner of 15% or more of the Common Stock then outstanding; 

(ii)       if the Board determines in good faith that a Person who would otherwise be an “Acquiring
Person” has become such inadvertently (including, 

 
without limitation, because (A) such Person was unaware that it beneficially owned a percentage of Common Stock that would otherwise cause such Person to be an “Acquiring Person”
or (B) such Person was aware of the extent of its Beneficial Ownership of Common Stock but had no actual knowledge of the consequences of such Beneficial Ownership under this Agreement and had no intention of changing or influencing control of
the Company), and such Person divests as promptly as practicable (as determined by the Board in its sole discretion) a sufficient number of shares of Common Stock (without exercising or retaining any power, including, without limitation, voting
power, with respect to such shares) (or, in the case solely of shares of Common Stock beneficially owned, directly or indirectly, by such Person pursuant to Section 1(f)(v) hereof, such Person terminates the subject Derivatives Contract(s) or
disposes of the subject derivative security or securities, or establishes to the satisfaction of the Board that such shares of Common Stock are not held with any intention of changing or influencing control of the Company) so that such Person is no
longer the Beneficial Owner of 15% or more of the Common Stock then outstanding, then such Person shall not be deemed to be or ever to have been an “Acquiring Person” for any purposes of this Agreement as a result of such inadvertent
acquisition; 
 (iii)       if a bona fide swaps dealer who would otherwise be an “Acquiring
Person” has become so as a result of its actions in the ordinary course of its business that the Board determines, in its sole discretion, were taken without the intent or effect of evading or assisting any other Person to evade the purposes
and intent of this Agreement, or otherwise seeking to control or influence the management or policies of the Company, then, and unless and until the Board shall otherwise determine, such person shall not be deemed to be an “Acquiring
Person” for any purposes of this Agreement; and 
 (iv)       if a Person would otherwise be deemed an
“Acquiring Person” upon the execution of this Agreement, such Person (herein referred to as a “Grandfathered Stockholder”) shall not be deemed an “Acquiring Person” for purposes of this Agreement unless and
until, subject to Section 1(a)(i) and Section 1(a)(ii) above, such Grandfathered Stockholder acquires Beneficial Ownership of any additional shares of Common Stock (other than as a result of a stock dividend, stock split, or similar
transaction effected by the Company in which all registered holders of Common Stock are treated substantially equally) after execution of this Agreement and while the Beneficial Owner of 15% or more of the Common Stock then outstanding, in which
case such Person shall no longer be deemed a Grandfathered Stockholder and shall be deemed an “Acquiring Person”; 
 For all
purposes of this Agreement, any calculation of the number of shares of Common Stock outstanding at any particular time, including for purposes of determining the particular percentage of such outstanding Common Stock of which any Person is the
Beneficial Owner, shall include the number of shares of Common Stock not outstanding at the time of such calculation that such Person is otherwise deemed to beneficially own for purposes of this Agreement. The number of shares of Common Stock not
outstanding that such Person is otherwise deemed to beneficially own for purposes of this Agreement shall be deemed to be outstanding for the purpose of computing the percentage of the outstanding number of shares of Common Stock beneficially owned
by such Person, but 

  
 2 

 
shall not be deemed to be outstanding for the purpose of computing the percentage of outstanding Common Stock beneficially owned by any other Person. 

(b)       “Act” shall mean the Securities Act of 1933, as amended. 

(c)       “Adjustment Shares” shall have the meaning set forth in Section 11(a)(ii)
hereof. 
 (d)       “Affiliate” and “Associate” shall have the respective
meanings ascribed to such terms in Rule 12b-2 of the General Rules and Regulations under the Exchange Act as in effect on the date of this Agreement; provided, however, that no director or
officer of the Company shall be deemed an Affiliate or Associate of any other director or officer of the Company solely as a result of his or her being a director or officer of the Company. 

(e)       “Agreement” shall have the meaning set forth in the preamble hereto. 

(f)       A Person shall be deemed the “Beneficial Owner” of, shall be deemed to have
“Beneficial Ownership” of, and shall be deemed to “beneficially own,” any securities: 
 (i)
      which such Person or any of such Person’s Affiliates or Associates beneficially owns, directly or indirectly (as determined pursuant to Rule 13d-3 of the General
Rules and Regulations under the Exchange Act as in effect on the date of this Agreement); 
 (ii)       which
such Person or any of such Person’s Affiliates or Associates, directly or indirectly, has the right to acquire (whether such right is exercisable immediately or only after the passage of time) pursuant to any agreement, arrangement, or
understanding (whether or not in writing) or upon the exercise of conversion rights, exchange rights, rights, warrants, or options, or otherwise; provided, however, that a Person shall not be deemed the “Beneficial Owner” of,
to have “Beneficial Ownership” of, or to “beneficially own,” (A) securities tendered pursuant to a tender offer or an exchange offer made in accordance with the General Rules and Regulations under the Exchange Act by or on
behalf of such Person or any of such Person’s Affiliates or Associates until such tendered securities are accepted for purchase or exchange, (B) securities issuable upon exercise of Rights at any time prior to the occurrence of a
Triggering Event, or (C) securities issuable upon exercise of Rights from and after the occurrence of a Triggering Event, which Rights were acquired by such Person or any of such Person’s Affiliates or Associates prior to the Distribution
Date or pursuant to Section 3(a) or Section 22 hereof (the “Original Rights”) or pursuant to Section 11(i) or Section 11(p) hereof in connection with an adjustment made with respect to any Original Rights; 

(iii)       which such Person or any of such Person’s Affiliates or Associates, directly or indirectly,
has the right to vote or dispose of, including pursuant to any agreement, arrangement, or understanding (whether or not in writing); provided, however, that a Person shall not be deemed the “Beneficial Owner” of, to have
“Beneficial 

  
 3 

 
Ownership” of, or to “beneficially own,” any security as a result of an agreement, arrangement, or understanding (whether or not in writing) to vote such security if such
agreement, arrangement, or understanding: (A) arises solely from a revocable proxy (as such term is defined in Regulation 14A under the Exchange Act) given in response to a public proxy or consent solicitation made pursuant to, and in
accordance with, the applicable provisions of the General Rules and Regulations under the Exchange Act, including the disclosure requirements of Schedule 14A thereunder, and (B) is not also then reportable by such Person on
Schedule 13D under the Exchange Act (or any comparable or successor report); 
 (iv)       which are
beneficially owned, directly or indirectly, by any other Person (or any Affiliate or Associate thereof) with which such Person (or any of such Person’s Affiliates or Associates) has any agreement, arrangement, or understanding (whether or not
in writing) for the purpose of acquiring, holding, voting (except pursuant to a revocable proxy as described in the proviso to Section 1(f)(iii)), or disposing of any voting securities of the Company; or 

(v)       which are “beneficially owned” (within the meaning of
clauses (i)-(iv) above), directly or indirectly, by a Counterparty (or any of such Counterparty’s Affiliates or Associates) under any Derivatives Contract (without regard to any short or similar
position under the same or any other Derivatives Contract) to which such Person or any of such Person’s Affiliates or Associates is a Receiving Party; provided, however, that the number of shares of Common Stock that a Person is
deemed to beneficially own pursuant to this clause (v) in connection with a particular Derivatives Contract shall not exceed the number of Notional Common Shares with respect to such Derivatives Contract; provided, further, that
the number of securities beneficially owned by each Counterparty (including its Affiliates and Associates) under a Derivatives Contract shall for purposes of this clause (v) be deemed to include all securities that are “beneficially
owned”, directly or indirectly, by any other Counterparty (or any of such other Counterparty’s Affiliates or Associates) under any Derivatives Contract to which such first Counterparty (or any of such first Counterparty’s Affiliates
or Associates) is a Receiving Party, with this proviso being applied to successive Counterparties as appropriate. 
 Notwithstanding
anything to the contrary in this Section 1(f), (x) nothing in this Section 1(f) shall cause a Person engaged in business as an underwriter of securities to be the “Beneficial Owner” of, to have “Beneficial
Ownership” of, or to “beneficially own,” any securities acquired or which such Person has the right to acquire through such Person’s participation in good faith in a firm commitment underwriting until the expiration of 40 days
after the date of such acquisition, and then only if such securities continue to be owned by such Person at such expiration of 40 days; and (y) any stockholder of the Company, with Affiliate(s), Associate(s), or other Person(s) who may be
deemed representatives of it serving as director(s) of the Company, shall not be deemed to “beneficially own” securities held by such other Persons serving as director(s) of the Company to the extent such securities were issued by the
Company to such director(s) in the ordinary course of business as compensation for their services as director(s) of the Company. 

  
 4 

 (g)       “Board” shall mean the Board of
Directors of the Company or any duly authorized committee thereof. 
 (h)       “Book Entry
Share” shall mean an uncertificated share of Common Stock registered in book entry form. 

(i)       “Business Day” shall mean any day other than a Saturday, Sunday, or a day on which
banking institutions in the State of New York are authorized or obligated by law or executive order to close. 

(j)       “Certificate of Incorporation” shall mean the Company’s Amended and Restated
Certificate of Incorporation, as such may be amended, modified, or restated from time to time. 
 (k)      
“Close of Business” on any given date shall mean 5:00 p.m., New York time, on such date; provided, however, that, if such date is not a Business Day, it shall mean 5:00 p.m., New York time, on the next
succeeding Business Day. 
 (l)       “Common Stock” shall mean the common stock, par value
$0.001 per share, of the Company, except that “Common Stock” when used with reference to any Person other than the Company shall mean the capital stock (or equity interest) of such Person with the greatest voting power, or the
equity securities or other equity interests having power to control or direct the management of such Person. 

(m)       “Common Stock Equivalents” shall have the meaning set forth in
Section 11(a)(iii) hereof. 
 (n)       “Company” shall have the meaning set forth in
the preamble hereto, except as otherwise provided in Section 13(a) hereof. 
 (o)      
“Counterparty” shall have the meaning set forth in Section 1(r) hereof. 

(p)      “Current Market Price” shall have the meaning set forth in Section 11(d) hereof.

 (q)       “Current Value” shall have the meaning set forth in Section 11(a)(iii)
hereof. 
 (r)       “Derivatives Contract” shall mean a contract between two parties (the
“Receiving Party” and the “Counterparty”) that is designed to produce economic benefits and risks to the Receiving Party that correspond substantially to the ownership by the Receiving Party of a number of shares of
Common Stock specified or referenced in such contract (the number corresponding to such economic benefits and risks, the “Notional Common Shares”), regardless of whether obligations under such contract are required or permitted to
be settled through the delivery of cash, Common Stock or other property, without regard to any short position under the same or any other Derivatives Contract. For the avoidance of doubt, interests in broad-based index options, broad-based

  
 5 

 
index futures and broad-based publicly traded market baskets of stocks approved for trading by the appropriate federal governmental authority shall not be deemed to be Derivatives Contracts. 

(s)       “Distribution Date” shall have the meaning set forth in Section 3(a) hereof.

 (t)       “Equivalent Preferred Stock” shall have the meaning set forth in
Section 11(b) hereof. 
 (u)       “Exchange Act” shall mean the Securities Exchange
Act of 1934, as amended. 
 (v)       “Exchange Ratio” shall have the meaning set forth in
Section 24(a) hereof. 
 (w)       “Exempt Person” shall mean (i) the Company,
(ii) any Subsidiary of the Company, (iii) any employee benefit plan of the Company or of any Subsidiary of the Company, or (iv) any Person or entity organized, appointed, or established by the Company or any Subsidiary of the Company
for or pursuant to the terms of any such employee benefit plan. 
 (x)       “Expiration
Date” shall have the meaning set forth in Section 7(a) hereof. 
 (y)       “Final
Expiration Date” shall have the meaning set forth in Section 7(a) hereof. 
 (z)      
“Grandfathered Stockholder” shall have the meaning set forth in Section 1(a)(iv) hereof. 

(aa)       “Notional Common Shares” shall have the meaning set forth in Section 1(r)
hereof. 
 (bb)       “Original Rights” shall have the meaning set forth in
Section 1(f)(ii) hereof. 
 (cc)       “Person” shall mean any individual, firm,
corporation, partnership, limited liability company, limited liability partnership, association, trust, syndicate, unincorporated organization, or other entity, and shall include any successor (by merger or otherwise) of such entity. 

(dd)       “Preferred Stock” shall mean shares of Series D Junior Participating Preferred
Stock, par value $0.001 per share, of the Company, having the rights and preferences set forth in the Certificate of Designation attached to this Agreement as Exhibit A, and, to the extent that there are not a sufficient number of shares
of Series D Junior Participating Preferred Stock authorized to permit the full exercise of the Rights, 

  
 6 

 
any other series of preferred stock of the Company designated for such purpose containing terms substantially similar to the terms of the Series D Junior Participating Preferred Stock. 

(ee)       “Principal Party” shall have the meaning set forth in Section 13(b) hereof.

 (ff)        “Purchase Price” shall have the meaning set forth in Section 7(b)
hereof. 
 (gg)       “Receiving Party” shall have the meaning set forth in
Section 1(r) hereof. 
 (hh)       “Record Date” shall have the meaning set forth in
the recital to this Agreement. 
 (ii)         “Redemption Price” shall have the
meaning set forth in Section 23(a) hereof. 
 (jj)         “Right” shall have
the meaning set forth in the recital to this Agreement. 
 (kk)       “Rights Agent” shall
have the meaning set forth in the preamble hereto, except as otherwise provided in Section 19 and Section 21 hereof. 

(ll)        “Rights Certificate” shall have the meaning set forth in
Section 3(a) hereof. 
 (mm)     “Rights Dividend Declaration Date” shall have the meaning set
forth in the recital to this Agreement. 
 (nn)       “Section 11(a)(ii) Event” shall
have the meaning set forth in Section 11(a)(ii) hereof. 
 (oo)       “Section 13
Event” shall mean any event described in Section 13(a)(i), Section 13(a)(ii), or Section 13(a)(iii) hereof. 

(pp)       “Spread” shall have the meaning set forth in Section 11(a)(iii) hereof. 

(qq)       “Stock Acquisition Date” shall mean the first date of public announcement (which,
for purposes of this definition, shall include, without limitation, a report filed or amended pursuant to Section 13(d) under the Exchange Act) by the Company or an Acquiring Person that an Acquiring Person has become such. 

(rr)        “Subsidiary” shall mean, with reference to any Person, any other Person of
which an amount of voting securities (or other ownership interests having ordinary voting power) sufficient to elect or appoint at least a majority of the directors (or other persons performing similar functions) of such other Person is beneficially
owned, 

  
 7 

 
directly or indirectly, by such first-mentioned Person, or otherwise controlled by such first-mentioned Person. 

(ss)     “Substitution Period” shall have the meaning set forth in Section 11(a)(iii) hereof.

 (tt)       “Summary of Rights” shall have the meaning set forth in Section 3(b)
hereof. 
 (uu)     “Trading Day” shall have the meaning set forth in Section 11(d)(i) hereof.

 (vv)     “Triggering Event” shall mean a Section 11(a)(ii) Event or any Section 13
Event. 
 (ww)   “Trust” shall have the meaning set forth in Section 24(f) hereof. 

(xx)      “Trust Agreement” shall have the meaning set forth in Section 24(f) hereof.

 Section 2.   Appointment of the Rights Agent. The Company hereby appoints the Rights Agent to act as rights agent
for the Company in accordance with the terms and conditions hereof, and the Rights Agent hereby accepts such appointment. The Company may from time to time appoint such co-rights agent(s) as it may deem necessary or desirable, upon ten
(10) days’ prior written notice to the Rights Agent, setting forth the respective duties of the Rights Agent and any co-rights agent. The Rights Agent shall have no duty to supervise, and shall in no event be liable for, the acts or
omissions of any co-rights agent. 
 Section 3.   Issuance of Rights Certificates. 

(a)       Until the earlier of (i) the Close of Business on the 10th Business Day after the Stock Acquisition Date (or, if the 10th day after the Stock Acquisition Date occurs before the Record Date, the Close of
Business on the Record Date) and (ii) the Close of Business on the 10th Business Day (or such later date as the Board may determine prior to the occurrence of a Section 11(a)(ii) Event)
after the date of commencement by or on behalf of any Person (other than an Exempt Person) of a tender offer or an exchange offer, if upon consummation thereof, such Person would become an Acquiring Person (the earlier of (i) and
(ii) being herein referred to as the “Distribution Date”), (A) the Rights will be evidenced (subject to Section 3(b) and Section 3(c) hereof) by the certificates for the Common Stock registered in the names of
the holders of the Common Stock (which certificates for shares of Common Stock shall be deemed also to be Rights Certificates) or, in the case of Book Entry Shares, by notation in book entry, and not by separate certificates, and the registered
holders of shares of the Common Stock shall also be the registered holders of the associated Rights, and (B) the Rights will be transferable only in connection with the transfer of the underlying Common Stock (including a transfer to the
Company); provided, however, that, if a tender offer or an exchange offer is terminated prior to the occurrence of a Distribution Date, then no Distribution Date shall occur as a result of such tender offer or exchange offer. As soon
as practicable after the Distribution 

  
 8 

 
Date, the Company will prepare and execute, the Rights Agent will countersign, and the Company will send or cause to be sent (or the Rights Agent, if so requested by the Company and provided with
all reasonably necessary information and documentation, in form and substance reasonably satisfactory to the Rights Agent, will send), in accordance with Section 26 hereof, to each record holder of the Common Stock as of the Close of Business
on the Distribution Date (other than an Acquiring Person or any Associate or Affiliate of an Acquiring Person), one or more Rights Certificates, in substantially the form of Exhibit B hereto (the “Rights Certificates”),
evidencing one Right for each share of Common Stock so held, subject to adjustment as provided herein. In the event that an adjustment in the number of Rights per share of Common Stock has been made pursuant to Section 11(i) or
Section 11(p) hereof, at the time of distribution of the Rights Certificates, the Company shall not be required to issue Rights Certificates evidencing fractional Rights but may, in lieu thereof, make the necessary and appropriate rounding
adjustments (in accordance with Section 14(a) hereof) so that Rights Certificates evidencing only whole numbers of Rights are distributed and cash is paid in lieu of any fractional Rights. As of and after the Distribution Date, the Rights will
be evidenced solely by such Rights Certificates. The Company shall promptly notify the Rights Agent in writing upon the occurrence of the Distribution Date and, if such notification is given orally, the Company shall confirm the same in writing
within two (2) Business Days. Until such written notice is received by the Rights Agent, the Rights Agent may presume conclusively for all purposes that the Distribution Date has not occurred. 

(b)       As promptly as practicable following the Record Date, the Company shall send or cause to be sent (or
the Rights Agent, if so requested by the Company and provided with all reasonably necessary information and documentation, in form and substance reasonably satisfactory to the Rights Agent, will send) a copy of a Summary of Rights, in substantially
the form attached hereto as Exhibit C (the “Summary of Rights”), to each record holder of Common Stock as of the Close of Business on the Record Date in accordance with Section 26 hereof. With respect to
certificates representing Common Stock and Book Entry Shares, as applicable, outstanding as of the Record Date, until the earlier of the Distribution Date and the Expiration Date, the Rights associated with such Common Stock will be evidenced by
such certificates for Common Stock registered in the names of the holders thereof, or by Book Entry Shares, as applicable, in each case together with a copy of the Summary of Rights. Until the earlier of the Distribution Date and the Expiration
Date, the transfer of any share of Common Stock outstanding on the Record Date (whether evidenced by certificates for Common Stock registered in the names of the holders thereof, or by Book Entry Shares, as applicable), with or without a copy of the
Summary of Rights, shall also constitute the transfer of the Right(s) associated therewith. 
 (c)      
Rights shall, without any further action, be issued in respect of all shares of Common Stock that are issued (whether originally issued or delivered from the Company’s treasury) after the Record Date, but prior to the earlier of the
Distribution Date and the Expiration Date and, to the extent provided in Section 22 hereof, in respect of Common Stock issued after the Distribution Date. Certificates evidencing such Common Stock shall have printed on or otherwise affixed to
them a legend or statement substantially in the following form: 

  
 9 

 This certificate also evidences and entitles the registered holder hereof to certain Rights as
set forth in a Rights Agreement between Arrowhead Pharmaceuticals, Inc. (the “Company”) and Computershare Trust Company, N.A. (or any successor rights agent), as Rights Agent, dated as of March 21, 2017, as it may from time to time be
supplemented or amended (the “Rights Agreement”), the terms of which are hereby incorporated herein by reference and a copy of which is on file at the principal offices of the Company. Under certain circumstances, as set forth in the
Rights Agreement, such Rights will be evidenced by separate certificates and will no longer be evidenced by this certificate. The Company will mail to the registered holder of this certificate a copy of the Rights Agreement, as in effect on the date
of mailing, without charge, promptly after receipt of a written request therefor. Under certain circumstances, as set forth in the Rights Agreement, Rights beneficially owned by any Person who is, was, or becomes an Acquiring Person or any Affiliate
or Associate thereof (as such terms are defined in the Rights Agreement), whether currently beneficially owned by or on behalf of such Person or by any subsequent beneficial owner, may become null and void. 

With respect to any Book Entry Shares, a legend or statement in substantially similar form shall be included in the confirmation or account statement or other
notice sent to the record holder of such shares in accordance with applicable law. Until the earlier of the Distribution Date and the Expiration Date, the Rights associated with the Common Stock evidenced by such certificates and such Book Entry
Shares, as applicable, shall be evidenced by such certificates or such Book Entry Shares alone, and the transfer of any such certificate or Book Entry Shares, as applicable, shall also constitute the transfer of the Rights associated with such
Common Stock. In the event the Company purchases or otherwise acquires any Common Stock after the Record Date, but prior to the Distribution Date, any Rights associated with such Common Stock shall be deemed cancelled and retired so that the Company
shall not be entitled to exercise any Rights associated with such Common Stock that are no longer outstanding. Notwithstanding this Section 3(c), neither the omission of a legend nor the failure to deliver the notice of such legend required
hereby shall affect the enforceability of any part of this Agreement or the rights of any holder of the Rights. 
 After the Record Date,
but prior to the earlier of the Distribution Date and the Expiration Date, if new certificate(s) representing shares of Common Stock are issued in connection with the transfer, split up, combination, or exchange of certificate(s) representing shares
of Common Stock, or if new certificate(s) representing shares of Common Stock are issued to replace any certificate(s) that have been mutilated, destroyed, lost, or stolen, then such new certificate(s) shall bear a legend or statement in
substantially the form of the foregoing. 
 Section 4.   Form of Rights Certificates. The Rights Certificates (and the
forms of election to purchase and of assignment and the certificates contained therein to be printed on the reverse thereof) shall each be substantially in the form attached hereto as Exhibit B and may have such marks of identification
or designation and such legends, summaries, or 

  
 10 

 
endorsements printed thereon as the Company may deem appropriate (which shall not affect the rights, duties, liabilities, protections or responsibilities of the Rights Agent hereunder) and as are
not inconsistent with the provisions of this Agreement, or as may be required to comply with any applicable law or with any rule or regulation made pursuant thereto or with any rule or regulation of any stock exchange on which the Rights may from
time to time be listed, or to conform to usage. Subject to the provisions of Sections 7, 11, 13, 22, 23, 24 and 27 hereof, the Rights Certificates, whenever distributed, shall be dated as of the Record Date and on their face shall entitle the
registered holders thereof to purchase such number of one one-thousandths of a share of Preferred Stock as shall be set forth therein at the Purchase Price, but the amount and type of securities or other assets that may be acquired upon the exercise
of each Right and the Purchase Price thereof shall be subject to adjustment as provided herein. 
 Section 5.  
Countersignature and Registration. 
 (a)       The Rights Certificates shall be executed on behalf of
the Company by its Chairman of the Board, its Chief Executive Officer, its President, or any Vice President, either manually or by facsimile signature, and shall have affixed thereto the Company’s seal or a facsimile thereof which shall be
attested to by the Secretary or an Assistant Secretary of the Company or by such officers as the Board may designate, either manually or by facsimile signature. The Rights Certificates shall be countersigned by an authorized signatory of the Rights
Agent, either manually or by facsimile signature, and shall not be valid for any purpose unless so countersigned. In case any officer of the Company who shall have signed any of the Rights Certificates shall cease to be such officer of the Company
before countersignature by an authorized signatory of the Rights Agent and issuance and delivery by the Company, such Rights Certificates, nevertheless, may be countersigned by an authorized signatory of the Rights Agent and issued and delivered by
the Company with the same force and effect as though the person who signed such Rights Certificates had not ceased to be such officer of the Company; and any Rights Certificates may be signed on behalf of the Company by any person who, at the actual
date of the execution of such Rights Certificate, shall be a proper officer of the Company to sign such Rights Certificate, although at the date of the execution of this Agreement any such person was not such an officer. In case any authorized
signatory of the Rights Agent who has countersigned any Right Certificate ceases to be an authorized signatory of the Rights Agent before issuance and delivery by the Company, such Rights Certificate, nevertheless, may be issued and delivered by the
Company with the same force and effect as though the person who countersigned such Rights Certificate had not ceased to be an authorized signatory of the Rights Agent; and any Rights Certificate may be countersigned on behalf of the Rights Agent by
any person who, at the actual date of the countersignature of such Rights Certificate, is properly authorized to countersign such Rights Certificate, although at the date of the execution of this Agreement any such person was not so authorized. 

(b)       Following the Distribution Date, upon receipt by the Rights Agent of notice of the Distribution Date,
the Rights Agent will keep, or cause to be kept, at its office or offices designated for such purpose, books for registration and transfer of the Rights Certificates issued hereunder. Such books shall show the names and addresses of

  
 11 

 
the respective holders of the Rights Certificates, the number of Rights evidenced on its face by each of the Rights Certificates, and the date of each of the Rights Certificates. 

Section 6.  Transfer, Split-Up, Combination, and Exchange of Rights Certificates; Mutilated, Destroyed, Lost, or Stolen
Rights Certificates. 
 (a)       Subject to the provisions of Section 7(e) and Section 14
hereof, at any time after the Close of Business on the Distribution Date, and at or prior to the Close of Business on the Expiration Date, any Rights Certificate or Certificates (other than Rights Certificates evidencing Rights that have become null
and void pursuant to Section 7(e) hereof or that have been redeemed or exchanged pursuant to Section 23 or Section 24 hereof) may be transferred, split-up, combined, or exchanged for another Rights Certificate or Certificates,
entitling the registered holder to purchase a like number of one one-thousandths of a share of Preferred Stock (or, following the occurrence of a Triggering Event, Common Stock, other securities, cash, or other assets, as the case may be) as the
Rights Certificate or Certificates surrendered then entitles such holder (or former holder in the case of a transfer) to purchase. Any registered holder desiring to transfer, split-up, combine, or exchange any Rights Certificate or Certificates
shall make such request in writing delivered to the Rights Agent, and shall surrender the Rights Certificate or Certificates to be transferred, split-up, combined, or exchanged, with the form of assignment and certificate contained therein duly
executed, at the office or offices of the Rights Agent designated for such purpose, along with a signature guarantee (if required) and such other and further documentation as the Company or the Rights Agent may reasonably request. Neither the Rights
Agent nor the Company shall be obligated to take any action whatsoever with respect to the transfer of any such surrendered Rights Certificate until the registered holder shall have properly completed and duly signed the certificate contained in the
form of assignment on the reverse side of such Rights Certificate and shall have provided such additional evidence, as the Company or the Rights Agent may reasonably request, of the identity of the Beneficial Owner (or former Beneficial Owner), any
Affiliates or Associates thereof, or of any other Person with which such Beneficial Owner or any of such Beneficial Owner’s Affiliates or Associates has any agreement, arrangement or understanding (whether or not in writing) for the purpose of
acquiring, holding, voting or disposing of securities of the Company. The Company or the Rights Agent may require payment of a sum sufficient to cover any tax or governmental charge that may be imposed in connection with any transfer, split-up,
combination or exchange of Rights Certificates. The Rights Agent shall not have any duty or obligation to take any action under any section of this Agreement that requires the payment of taxes and/or charges unless and until it is satisfied that all
such payments have been made, and the Rights Agent shall promptly forward any such sum collected by it to the Company or to such Persons as the Company may specify by written notice. Thereupon the Rights Agent shall, subject to Section 7(e),
Section 14, and Section 24 hereof, countersign and deliver to the Person entitled thereto a Rights Certificate or Rights Certificates, as the case may be, as so requested. 

(b)       Upon receipt by the Company and the Rights Agent of evidence reasonably satisfactory to them of the
loss, theft, destruction, or mutilation of a Rights Certificate, and, in case of loss, theft, or destruction, of indemnity or security reasonably 

  
 12 

 
satisfactory to them, along with such other and further documentation as the Company or the Rights Agent may reasonably request, and reimbursement to the Company and the Rights Agent of all
reasonable fees and expenses incidental thereto, and upon surrender to the Rights Agent and cancellation of the Rights Certificate, if mutilated, the Company will execute and deliver a new Rights Certificate of like tenor to the Rights Agent for
countersignature and delivery to the registered holder in lieu of the Rights Certificate so lost, stolen, destroyed, or mutilated. 

Section 7.   Exercise of Rights; Purchase Price; Expiration Date of Rights. 

(a)       Subject to Section 7(e) hereof, at any time after the Distribution Date, the registered holder
of any Rights Certificate may exercise the Rights evidenced thereby (except as otherwise provided herein including, without limitation, the restrictions on exercisability as set forth in Section 9(c) and Section 11(a)(iii) hereof) in whole
or in part upon surrender of the Rights Certificate, with the form of election to purchase and the certificate on the reverse side thereof properly completed and duly executed (with such signature duly guaranteed, if required), to the Rights Agent
at the office or offices of the Rights Agent designated for such purpose, together with payment of the aggregate Purchase Price with respect to the total number of one one-thousandths of a share of Preferred Stock (or, following the occurrence of a
Triggering Event, Common Stock, other securities, cash, or other assets, as the case may be) as to which such surrendered Rights are then exercisable and an amount equal to any tax or charge required to be paid under Section 9 hereof, at or
prior to the earliest of (i) the Close of Business on March 21, 2018 (the “Final Expiration Date”), (ii) the time at which the Rights are redeemed as provided in Section 23 hereof, and (iii) the time at
which the Rights are exchanged in full as provided in Section 24 hereof (the earliest of (i), (ii), and (iii) being herein referred to as, the “Expiration Date”). Except for those provisions herein that expressly survive
the termination of this Agreement, this Agreement shall terminate at such time as the Rights are no longer exercisable hereunder. 

(b)       The purchase price for each one one-thousandth of a share of Preferred Stock pursuant to the exercise
of a Right initially shall be $20, shall be subject to adjustment from time to time as provided in Section 11 and Section 13(a) hereof, and shall be payable in accordance with Section 7(c) hereof (such purchase price, as so adjusted,
the “Purchase Price”). 
 (c)       Upon receipt of a Rights Certificate evidencing
exercisable Rights, with the form of election to purchase and the certificate on the reverse side thereof properly completed and duly executed, accompanied by payment, with respect to each Right so exercised, of the Purchase Price per one
one-thousandth of a share of Preferred Stock (or, following the occurrence of a Triggering Event, Common Stock, other securities, cash, or other assets, as the case may be) to be purchased as set forth below and an amount equal to any applicable
transfer tax or charge required to be paid by the holder of such Rights Certificate in accordance with Section 9 hereof, or evidence satisfactory to the Company of payment of such tax or charge, the Rights Agent shall, subject to
Section 20(k) hereof, thereupon promptly (i) (A) requisition from any transfer agent of the shares of Preferred Stock (or make available, if the Rights Agent is the transfer agent for 

  
 13 

 
such shares) certificates for the total number of one one-thousandths of a share of Preferred Stock to be purchased and the Company hereby irrevocably authorizes its transfer agent to comply with
all such requests, or (B) if the Company shall have elected to deposit the total number of shares of Preferred Stock issuable upon exercise of the Rights hereunder with a depositary agent, requisition from the depositary agent depositary
receipts evidencing such number of one one-thousandths of a share of Preferred Stock as are to be purchased (in which case certificates for Preferred Stock evidenced by such receipts shall be deposited by the transfer agent with the depositary
agent) and the Company will direct the depositary agent to comply with such request, (ii) requisition from the Company the amount of cash, if any, to be paid in lieu of fractional shares in accordance with Section 14 hereof,
(iii) after receipt of such certificates or depositary receipts, cause the same to be delivered to or upon the order of the registered holder of such Rights Certificate, registered in such name or names as may be designated by such holder, and
(iv) after receipt thereof, deliver such cash, if any, to or upon the order of the registered holder of such Rights Certificate. The payment of the Purchase Price (as such amount may be reduced pursuant to Section 11(a)(iii) hereof) shall
be made in cash or by certified bank check or bank draft payable to the order of the Company. In the event that the Company is obligated to issue other securities (including Common Stock) of the Company, pay cash, or distribute other property
pursuant to Section 11(a) hereof, the Company will make all arrangements necessary so that such other securities, cash, or other property are available for distribution by the Rights Agent, if and when appropriate. The Company reserves the
right to require prior to the occurrence of a Triggering Event that, upon any exercise of Rights, a number of Rights be exercised so that only whole shares of Preferred Stock would be issued. 

(d)       In case the registered holder of any Rights Certificate shall properly exercise less than all the
Rights evidenced thereby, a new Rights Certificate evidencing the Rights remaining unexercised shall be issued by the Rights Agent and delivered to, or upon the order of, the registered holder of such Rights Certificate, registered in such name or
names as may be designated by such holder, subject to the provisions of Sections 6 and 14 hereof. 

(e)       Notwithstanding anything in this Agreement to the contrary, from and after the first occurrence of a
Section 11(a)(ii) Event, any Rights beneficially owned by (i) an Acquiring Person or an Associate or Affiliate of an Acquiring Person, (ii) a transferee of an Acquiring Person (or of any such Associate or Affiliate) who becomes a
transferee after the Acquiring Person becomes such, or (iii) a transferee of an Acquiring Person (or of any such Associate or Affiliate) who becomes a transferee prior to or concurrently with the Acquiring Person becoming such and receives such
Rights pursuant to either (A) a transfer (whether or not for consideration) from the Acquiring Person (or any such Associate of Affiliate) to holders of equity interests in such Acquiring Person (or any such Associate or Affiliate) or to any
Person with whom the Acquiring Person (or any such Associate of Affiliate) has any continuing agreement, arrangement, or understanding (whether or not in writing) regarding the transferred Rights, shares of Common Stock, or the Company or (B) a
transfer that the Board, in its sole discretion, has determined is part of a plan, an arrangement, or an understanding (whether or not in writing) that has as a primary purpose or effect the avoidance of the provisions of this Section 7(e),
shall become null and void without any further action and no holder of such Rights shall have any rights 

  
 14 

 
or preferences whatsoever with respect to such Rights, whether under any provision of this Agreement, the Rights Certificates, or otherwise. The Company shall use its reasonable best efforts to
ensure that the provisions of this Section 7(e) are complied with, but shall have no liability to any holder of Rights Certificates or, subject to Section 18 of this Agreement, any other Person as a result of its failure to make any
determinations with respect to an Acquiring Person or any of its Affiliates, Associates, or transferees hereunder. 

(f)       Notwithstanding anything in this Agreement or any Rights Certificate to the contrary, neither the
Rights Agent nor the Company shall be obligated to undertake any action with respect to a registered holder of a Rights Certificate upon the occurrence of any purported exercise as set forth in this Section 7 by such registered holder unless
such registered holder shall have (i) properly completed and duly executed the certificate contained in the form of election to purchase set forth on the reverse side of the Rights Certificate surrendered for such exercise, and
(ii) provided such additional evidence of the identity of the Beneficial Owner (or former Beneficial Owner) of the Rights represented by such Rights Certificate or Affiliates or Associates thereof, as the Company shall reasonably request. 

Section 8.   Cancellation and Destruction of Rights Certificates. All Rights Certificates surrendered for the purpose of
exercise, transfer, split-up, combination, or exchange shall, if surrendered to the Company or to any of its agents, be delivered to the Rights Agent for cancellation or in cancelled form, or, if surrendered to the Rights Agent, shall be cancelled
by it, and no Rights Certificates shall be issued in lieu thereof except as expressly permitted by any of the provisions of this Agreement. The Company shall deliver to the Rights Agent for cancellation and retirement, and the Rights Agent shall so
cancel and retire, any other Rights Certificate purchased or acquired by the Company otherwise than upon the exercise thereof. The Rights Agent shall deliver all cancelled Rights Certificates to the Company, or shall, at the written request of the
Company, destroy, or cause to be destroyed, such cancelled Rights Certificates, and in such case shall deliver a certificate evidencing the destruction thereof to the Company (or, at the Company’s option, appropriate copies of the electronic
records relating to Rights Certificates so cancelled or destroyed by the Rights Agent). 
 Section 9.   Reservation and
Availability of Capital Stock. 
 (a)       The Company covenants and agrees that at all times prior to
the Expiration Date it will cause to be reserved and kept available out of its authorized and unissued shares of Preferred Stock and/or out of any shares of Preferred Stock held in its treasury (and following the occurrence of a Triggering Event,
out of the authorized but unissued shares of such other equity securities of the Company as may be issuable upon exercise of the Rights and/or out of any shares of such securities held in its treasury, if available), the number of shares of
Preferred Stock (and following the occurrence of a Triggering Event, the number of shares of such other equity securities of the Company, if available) that will be sufficient to permit the exercise in full of all outstanding Rights in accordance
with Section 7 hereof. Upon the occurrence of any events resulting in the increase in the aggregate number of shares of Preferred Stock (or other equity securities of the Company) issuable upon exercise of all outstanding Rights above the
number then 

  
 15 

 
reserved, the Company shall make appropriate increases in the number of shares so reserved, unless cash or other assets is/are to be distributed pursuant to Section 11(a)(iii). 

(b)       So long as the Preferred Stock (and, following the occurrence of a Triggering Event, Common Stock or
other securities, as the case may be) issuable and deliverable upon the exercise of the Rights may be listed on any national securities exchange or quoted on a quotation system, the Company shall use its best efforts to cause, from and after such
time as the Rights become exercisable (but only to the extent that it is reasonably likely that the Rights will be exercised) through the Expiration Date, all shares reserved for such issuance to be listed on such exchange or quoted on such
quotation system, as the case may be, upon notice of issuance upon such exercise. 
 (c)       The Company
shall use its best efforts to (i) file, as soon as practicable following the earliest date after the first occurrence of a Section 11(a)(ii) Event on which the consideration to be delivered by the Company upon exercise of the Rights has
been determined in accordance with Section 11(a) hereof, a registration statement on an appropriate form under the Act, with respect to the securities purchasable upon exercise of the Rights, (ii) cause such registration statement to
become effective as soon as practicable after such filing, and (iii) cause such registration statement to remain effective (with a prospectus at all times meeting the requirements of the Act) until the earlier of (A) the date as of which
the Rights are no longer exercisable for such securities, and (B) the date of the expiration of the Rights. The Company will also take such action as may be appropriate under, or to ensure compliance with, the securities or “blue sky”
laws of the various states in connection with the exercisability of the Rights. The Company may temporarily suspend, for a period of time not to exceed ninety (90) days after the date set forth in clause (i) of the first sentence of
this Section 9(c), the exercisability of the Rights in order to prepare and file such registration statement and permit it to become effective. Upon any such suspension, the Company shall issue a public announcement stating that the
exercisability of the Rights has been temporarily suspended, as well as a public announcement at such time as the suspension is no longer in effect, in each case with simultaneous written notice to the Rights Agent. In addition, if the Company shall
determine that a registration statement is required following the Distribution Date, the Company similarly may temporarily suspend the exercisability of the Rights until such time as a registration statement has been declared effective.
Notwithstanding any provision of this Agreement to the contrary, the Rights shall not be exercisable in any jurisdiction if the requisite qualification(s) in such jurisdiction shall not have been obtained, or if the exercise thereof shall not be
permitted under applicable law or if a registration statement shall not have been declared effective. 

(d)       The Company further covenants and agrees that it will take all such action as may be necessary to
ensure that all Preferred Stock (and, following the occurrence of a Triggering Event, Common Stock or other securities, as the case may be, if available) delivered upon exercise of the Rights shall, at the time of delivery of such shares (subject to
payment of the Purchase Price), be duly and validly authorized and issued and fully paid and non-assessable. 

  
 16 

 (e)       The Company further covenants and agrees that it will
pay when due and payable any and all federal and state transfer taxes and charges that may be payable in respect of the issuance or delivery of the Rights Certificates and of any Preferred Stock (or, following the occurrence of a Triggering Event,
Common Stock or other securities, as the case may be) upon the exercise of Rights. The Company shall not, however, be required to pay any transfer tax that may be payable in respect of any transfer or delivery of Rights Certificates to a Person
other than, or the issuance or delivery of Preferred Stock (or, following the occurrence of a Triggering Event, Common Stock or other securities, as the case may be) in a name other than that of the registered holder of the Rights Certificates
evidencing Rights surrendered for exercise or to issue or deliver any certificates or book entries for Preferred Stock (or, following the occurrence of a Triggering Event, Common Stock or other securities, as the case may be) in a name other than
that of the registered holder upon the exercise of any Rights until such tax shall have been paid (any such tax being payable by the registered holder of such Rights Certificates at the time of surrender) or until it has been established to the
Company’s satisfaction that no such tax is due. 
 Section 10.   Preferred Stock Record Date. Each Person in
whose name any certificate or entry in the book entry account system of the transfer agent for Preferred Stock (or, following the occurrence of a Triggering Event, Common Stock or other securities, as the case may be) is issued upon the exercise of
Rights shall for all purposes be deemed to have become the holder of record of such Preferred Stock (or, following the occurrence of a Triggering Event, Common Stock or other securities, as the case may be) evidenced thereby on, and such certificate
or entry in the book entry account system of the transfer agent shall be dated, the date upon which the Rights Certificate evidencing such Rights was duly surrendered and payment of the Purchase Price (and all applicable transfer taxes or charges)
was made; provided, however, that, if the date of such surrender and payment is a date upon which the Preferred Stock (or, following the occurrence of a Triggering Event, Common Stock or other securities, as the case may be) transfer
books of the Company are closed, such Person shall be deemed to have become the record holder of such securities (fractional or otherwise) on, and such certificate or entry in the book entry account system of the transfer agent shall be dated, the
next succeeding Business Day on which the Preferred Stock (or, following the occurrence of a Triggering Event, Common Stock or other securities, as the case may be) transfer books of the Company are open. Prior to the exercise of the Rights
evidenced thereby, the registered holder of a Rights Certificate shall not be entitled to any rights of a stockholder of the Company with respect to shares for which the Rights shall be exercisable, including, without limitation, the right to vote,
to receive dividends or other distributions, or to exercise any preemptive rights, and shall not be entitled to receive any notice of any proceedings of the Company, except as provided herein. 

Section 11.   Adjustment of Purchase Price, Number and Kind of Shares, or Number of Rights. The Purchase Price, the
number and kind of shares, or fractions thereof, purchasable upon exercise of each Right, and the number of Rights outstanding are subject to adjustment from time to time as provided in this Section 11. 

(a)      (i)       In the event the Company shall at any time after the date of
this Agreement (A) declare or pay a dividend on the shares of Preferred Stock payable in 

  
 17 

 
shares of Preferred Stock, (B) subdivide or split the outstanding shares of Preferred Stock, (C) combine or consolidate the outstanding shares of Preferred Stock into a smaller number
of shares, or (D) issue any shares of its capital stock in a reclassification of the shares of Preferred Stock (including any such reclassification in connection with a consolidation or merger in which the Company is the continuing or surviving
corporation), except as otherwise provided in this Section 11(a) and Section 7(e) hereof, the Purchase Price in effect at the time of the record date for such dividend or of the effective date of such subdivision, split, combination,
consolidation, or reclassification, and the number and kind of shares (or fractions thereof) of Preferred Stock (or other capital stock, as the case may be), issuable on such date, shall be proportionately adjusted so that the registered holder of
any Right exercised after such time shall be entitled to receive, upon payment of the Purchase Price then in effect, the aggregate number and kind of shares (or fractions thereof) of Preferred Stock (or other capital stock, as the case may be),
which, if such Right had been exercised immediately prior to such date (whether or not such Right was then exercisable) and at a time when the Preferred Stock (or other capital stock, as the case may be) transfer books of the Company were open, such
holder would have owned upon such exercise and been entitled to receive by virtue of such dividend, subdivision, split, combination, consolidation, or reclassification; provided, however, that in no event shall the consideration to be
paid upon the exercise of one Right be less than the aggregate par value of the shares (or fractions thereof) of capital stock of the Company issuable upon exercise of one Right. If an event occurs that would require an adjustment under both this
Section 11(a)(i) and Section 11(a)(ii) hereof, the adjustment provided for in this Section 11(a)(i) shall be in addition to, and shall be made prior to, any adjustment required pursuant to Section 11(a)(ii) hereof. 

(ii)       In the event any Person shall become an Acquiring Person (a “Section 11(a)(ii)
Event”), then, promptly following the occurrence of such Section 11(a)(ii) Event, proper provision shall be made so that each registered holder of a Right (except as provided below and in Section 7(e), Section 13 and
Section 24 hereof) shall thereafter have the right to receive, upon exercise thereof at a price equal to the then current Purchase Price in accordance with the terms of this Agreement, in lieu of a number of one one-thousandths of a share of
Preferred Stock, such number of shares of Common Stock as shall equal the result obtained by (A) multiplying the then current Purchase Price by the then number of one one-thousandths of a share of Preferred Stock for which a Right was
exercisable immediately prior to the first occurrence of a Section 11(a)(ii) Event, and (B) dividing that product (which, following such first occurrence, shall thereafter be referred to as the “Purchase Price” for each
Right and for all purposes of this Agreement other than Section 13 hereof) by 50% of the Current Market Price per share of Common Stock on the date of such first occurrence (such number of shares of Common Stock, the “Adjustment
Shares”). 
 (iii)       In the event that (A) the number of shares of Common Stock authorized
by the Certificate of Incorporation, but which are not outstanding or reserved for issuance for purposes other than upon exercise of the Rights, are not sufficient to permit the exercise in full of the Rights in accordance with
Section 11(a)(ii) hereof or (B) the Board otherwise shall determine to do so in its sole discretion, the Company, acting by resolution of the Board, shall (1) determine the value of the Adjustment Shares issuable

  
 18 

 
upon the exercise of a Right (the “Current Value”), and (2) with respect to each Right (subject to Section 7(e) hereof), make adequate provision to substitute for the
Adjustment Shares, upon the exercise of such Right and payment of the applicable Purchase Price, (u) cash, (v) a reduction in the Purchase Price, (w) Common Stock or other equity securities of the Company (including, without
limitation, shares, or units of shares, of preferred stock, such as the Preferred Stock, which the Board has deemed to have essentially the same value or economic rights as Common Stock (such shares of preferred stock being referred to as
“Common Stock Equivalents”)), (x) debt securities of the Company, (y) other assets, or (z) any combination of the foregoing, having an aggregate value equal to the Current Value, where such aggregate value has been
determined by the Board based upon the advice of a nationally recognized investment banking firm selected by the Board; provided, however, that, if, under the circumstances set forth in clause (A) above, the Company shall not have
made adequate provision to deliver value pursuant to clause (2) above within thirty (30) days following the first occurrence of a Section 11(a)(ii) Event, then the Company shall be obligated to deliver, upon the surrender for exercise
of a Right and without requiring payment of the Purchase Price, Common Stock (to the extent available) and then, if necessary, cash, which shares and cash have an aggregate value equal to the Spread. For purposes of the preceding sentence, the term
“Spread” shall mean the excess of the Current Value over the Purchase Price. If the Board determines in good faith that it is likely that sufficient additional Common Stock could be authorized for issuance upon exercise in full of
the Rights, the 30-day period set forth above may be extended to the extent necessary, but not more than ninety (90) days following the first occurrence of a Section 11(a)(ii) Event, in order that
the Company may seek stockholder approval for the authorization of such additional shares (such 30-day period, as it may be extended, is herein called the “Substitution Period”). To the extent
that action is to be taken pursuant to the first or third sentences of this Section 11(a)(iii), the Company shall provide, subject to Section 7(e) hereof, that such action shall apply uniformly to all outstanding Rights, and the Company
may suspend the exercisability of the Rights until the expiration of the Substitution Period in order to seek such stockholder approval for such authorization of additional shares or to decide the appropriate form of distribution to be made pursuant
to such first sentence and to determine the value thereof. In the event of any such suspension, the Company shall issue a public announcement stating that the exercisability of the Rights has been temporarily suspended, as well as a public
announcement at such time as the suspension is no longer in effect, in each case with simultaneous written notice to the Rights Agent. For purposes of this Section 11(a)(iii), the value of each Adjustment Share shall be the Current Market Price
per share of Common Stock on the date of the first occurrence of a Section 11(a)(ii) Event and the per share or per unit value of any Common Stock Equivalent shall be deemed to equal the Current Market Price per share of Common Stock on such
date. 
 (b)      In case the Company shall fix a record date for the issuance of rights, options, or
warrants to all registered holders of Preferred Stock entitling them to subscribe for or purchase (for a period expiring within 45 calendar days after such record date) Preferred Stock (or shares having the same rights, privileges, and preferences
as the shares of Preferred Stock (“Equivalent Preferred Stock”)) or securities convertible into shares of Preferred Stock or Equivalent Preferred Stock at a price per share of Preferred Stock or Equivalent Preferred Stock (or having
a conversion price per share, if a security 

  
 19 

 
convertible into shares of Preferred Stock or Equivalent Preferred Stock) less than the Current Market Price per share of Preferred Stock on such record date, the Purchase Price to be in effect
after such record date shall be determined by multiplying the Purchase Price in effect immediately prior to such record date by a fraction, the numerator of which shall be the number of shares of Preferred Stock outstanding on such record date plus
the number of shares of Preferred Stock that the aggregate subscription or offering price of the total number of shares of Preferred Stock and/or Equivalent Preferred Stock so to be offered (and/or the aggregate initial conversion price of the
convertible securities so to be offered) would purchase at such Current Market Price, and the denominator of which shall be the number of shares of Preferred Stock outstanding on such record date plus the number of additional shares of Preferred
Stock and/or Equivalent Preferred Stock to be offered for subscription or purchase (or into which the convertible securities so to be offered are initially convertible). In case such subscription price may be paid by delivery of consideration, part
or all of which may be in a form other than cash, the value of such consideration shall be as determined in good faith by the Board, whose determination shall be described in a statement filed with the Rights Agent and shall be binding and
conclusive for all purposes on the Rights Agent and the holder of the Rights. Preferred Stock owned by or held for the account of the Company or any Subsidiary shall not be deemed outstanding for the purpose of any such computation. Such adjustments
shall be made successively whenever such a record date is fixed, and in the event that such rights, options, or warrants are not so issued, the Purchase Price shall be adjusted to be the Purchase Price that would then be in effect if such record
date had not been fixed. 
 (c)      In case the Company shall fix a record date for a distribution to all
registered holders of Preferred Stock (including any such distribution made in connection with a consolidation or merger in which the Company is the continuing or surviving corporation) of cash (other than a regular periodic cash dividend out of the
earnings or retained earnings of the Company), assets (other than a dividend payable in shares of Preferred Stock, but including any dividend payable in stock other than Preferred Stock) or evidences of indebtedness, or of subscription rights,
options or warrants (excluding those referred to in Section 11(b) hereof), the Purchase Price to be in effect after such record date shall be determined by multiplying the Purchase Price in effect immediately prior to such record date by a
fraction, the numerator of which shall be the Current Market Price per share of Preferred Stock on such record date, less the fair market value (as determined in good faith by the Board, whose determination shall be described in a statement filed
with the Rights Agent and shall be conclusive for all purposes) of the portion of the cash, assets or evidences of indebtedness so to be distributed, or of such subscription rights, options or warrants applicable to a share of Preferred Stock, and
the denominator of which shall be such Current Market Price per share of Preferred Stock. Such adjustments shall be made successively whenever such a record date is fixed, and in the event that such distribution is not so made, the Purchase Price
shall be adjusted to be the Purchase Price that would then be in effect if such record date had not been fixed. 

(d)      (i)      For the purpose of any computation hereunder, other than
computations made pursuant to Section 11(a)(iii) hereof, the “Current Market Price” per share of Common Stock on any date shall be deemed to be the average of the daily closing prices per share of Common Stock for the thirty
(30) consecutive Trading Days 

  
 20 

 
immediately prior to such date, and for the purposes of computations made pursuant to Section 11(a)(iii) hereof, the “Current Market Price” per share of Common Stock on any
date shall be deemed to be the average of the daily closing prices per share of Common Stock for the ten (10) consecutive Trading Days immediately following such date; provided, however, that in the event that the Current Market
Price per share of Common Stock is determined during a period following the announcement by the issuer of (A) a dividend or distribution on such Common Stock payable in shares of Common Stock or securities convertible into such Common Stock
(other than the Rights), or (B) any subdivision, combination, or reclassification of such Common Stock, and the ex-dividend date for such dividend or distribution, or the record date for such subdivision, combination, or reclassification shall
not have occurred prior to the commencement of the requisite 30-Trading Day or 10-Trading Day period, as set forth above, then, and in each such case, the Current Market
Price shall be properly adjusted to take into account ex-dividend trading. The closing price for each day shall be the last sale price, regular way, or, in case no such sale takes place on such day, the average of the closing bid and asked prices,
regular way, in either case as reported in the principal consolidated transaction reporting system with respect to securities listed or admitted to trading on the NASDAQ Global Select Market or, if the Common Stock is not listed or admitted to
trading on the NASDAQ Global Select Market, as reported in the principal consolidated transaction reporting system with respect to securities listed on the principal national securities exchange on which the Common Stock is listed or admitted to
trading or, if the Common Stock is not listed or admitted to trading on any national securities exchange, the last quoted price or, if not so quoted, the average of the high bid and low asked prices in the over-the-counter market, as reported on a
quotation system then in use, or, if on any such date the Common Stock is not so quoted, the average of the closing bid and asked prices as furnished by a professional market maker making a market in the Common Stock selected by the Board. If on any
such date the Common Stock is not publicly held and is not so listed, admitted to trading, or quoted, and no market maker is making a market in the Common Stock, the “Current Market Price” per share of Common Stock shall mean the
fair value per share on such date as determined in good faith by the Board, which determination shall be described in a statement filed with the Rights Agent and shall be conclusive for all purposes. The term “Trading Day” shall
mean a day on which the principal national securities exchange on which the Common Stock is listed or admitted to trading is open for the transaction of business or, if the Common Stock is not listed or admitted to trading on any national securities
exchange, a Business Day. 
 (ii)      For the purpose of any computation hereunder, the “Current
Market Price” per share of Preferred Stock shall be determined in the same manner as set forth above for the Common Stock in Section 11(d)(i) hereof (other than the penultimate sentence thereof). If the Current Market Price per share
of Preferred Stock cannot be determined in the manner provided above or if the shares of Preferred Stock are not publicly held or listed, admitted to trading, or quoted in a manner described in Section 11(d)(i) hereof, the Current Market Price
per share of Preferred Stock shall be conclusively deemed to be an amount equal to 1,000 (as such number may be appropriately adjusted for such events as stock splits, stock dividends, and recapitalizations with respect to the Common Stock occurring
after the date of this Agreement) multiplied by the Current Market Price per share of Common Stock. If neither the Common Stock nor the Preferred 

  
 21 

 
Stock is publicly held or listed, admitted to trading, or quoted, the “Current Market Price” per share of Preferred Stock shall mean the fair value per share as determined in
good faith by the Board, whose determination shall be described in a statement filed with the Rights Agent and shall be conclusive for all purposes. For all purposes of this Agreement, the Current Market Price of one one-thousandth of a share of
Preferred Stock shall be equal to the Current Market Price of one share of Preferred Stock divided by 1,000. 

(e)      Anything herein to the contrary notwithstanding, no adjustment in the Purchase Price shall be required
unless such adjustment would require an increase or a decrease of at least 1% in the Purchase Price; provided, however, that any adjustments which by reason of this Section 11(e) are not required to be made shall be carried
forward and taken into account in any subsequent adjustment. All calculations under this Section 11 shall be made to the nearest cent or to the nearest ten-thousandth of a share of Common Stock or other share or ten-millionth of a share of
Preferred Stock, as the case may be. Notwithstanding the first sentence of this Section 11(e), any adjustment required by this Section 11 shall be made no later than the earlier of (i) three years from the date of the transaction that
mandates such adjustment and (ii) the Expiration Date. 
 (f)      If, as a result of an adjustment made
pursuant to Section 11(a)(ii) or Section 13(a) hereof, the registered holder of any Right thereafter exercised shall become entitled to receive any shares of capital stock other than Preferred Stock, thereafter the number of such other
shares so receivable upon exercise of any Right and the Purchase Price thereof shall be subject to adjustment from time to time in a manner and on terms as nearly equivalent as practicable to the provisions with respect to the Preferred Stock
contained in Sections 11(a), (b), (c), (d), (e), (g), (h), (i), (j), (k), (l) and (m), and the provisions of Sections 7, 9, 10, 13, and 14 hereof with respect to the Preferred Stock shall apply on like terms to any such other shares.

 (g)      All Rights originally issued by the Company subsequent to any adjustment made to the Purchase
Price hereunder shall evidence the right to purchase, at the adjusted Purchase Price, the number of one one-thousandths of a share of Preferred Stock (or other securities or amount of cash or combination thereof) purchasable from time to time
hereunder upon exercise of the Rights, all subject to further adjustment as provided herein. 

(h)      Unless the Company shall have exercised its election as provided in Section 11(i) hereof, upon
each adjustment of the Purchase Price as a result of the calculations made in Section 11(b) and Section 11(c) hereof, each Right outstanding immediately prior to the making of such adjustment shall thereafter evidence the right to
purchase, at the adjusted Purchase Price, that number of one one-thousandths of a share of Preferred Stock (calculated to the nearest ten-millionth) obtained by (i) multiplying (A) the number of one one-thousandths of a share of Preferred
Stock covered by a Right immediately prior to this adjustment, by (B) the Purchase Price in effect immediately prior to such adjustment of the Purchase Price, and (ii) dividing the product so obtained by the Purchase Price in effect
immediately after such adjustment of the Purchase Price. 

  
 22 

 (i)      The Company may elect on or after the date of any
adjustment of the Purchase Price to adjust the number of Rights, in lieu of any adjustment in the number of one one-thousandths of a share of Preferred Stock purchasable upon the exercise of a Right pursuant to Section 11(h) hereof. Each of the
Rights outstanding after the adjustment in the number of Rights shall be exercisable for the number of one one-thousandths of a share of Preferred Stock for which a Right was exercisable immediately prior to such adjustment. Each Right held of
record prior to such adjustment of the number of Rights shall become that number of Rights (calculated to the nearest one ten-thousandth) obtained by dividing the Purchase Price in effect immediately prior to adjustment of the Purchase Price by the
Purchase Price in effect immediately after adjustment of the Purchase Price. The Company shall make a public announcement of its election to adjust the number of Rights, indicating the record date for the adjustment, and, if known at the time, the
amount of the adjustment to be made. This record date may be the date on which the Purchase Price is adjusted or any day thereafter, but, if the Rights Certificates have been issued, shall be at least ten (10) days later than the date of the
public announcement. If Rights Certificates have been issued, upon each adjustment of the number of Rights pursuant to this Section 11(i), the Company shall, as promptly as practicable, cause to be distributed to holders of record of Rights
Certificates on such record date, Rights Certificates evidencing, subject to Section 14 hereof, the additional Rights to which such holders shall be entitled as a result of such adjustment, or, at the option of the Company, shall cause to be
distributed to such holders of record in substitution and replacement for the Rights Certificates held by such holders prior to the date of adjustment, and upon surrender thereof, if required by the Company, new Rights Certificates evidencing all
the Rights to which such holders shall be entitled after such adjustment. Rights Certificates so to be distributed shall be issued, executed, and countersigned in the manner provided for herein (and may bear, at the option of the Company, the
adjusted Purchase Price) and shall be registered in the names of the holders of record of Rights Certificates on the record date specified in the public announcement. 

(j)      Irrespective of any adjustment or change in the Purchase Price or the number of one one-thousandths of
a share of Preferred Stock issuable upon the exercise of the Rights, the Rights Certificates theretofore and thereafter issued may continue to express the Purchase Price per one one-thousandth of a share of Preferred Stock and the number of one
one-thousandths of a share of Preferred Stock that were expressed in the initial Rights Certificates issued hereunder. 

(k)      Before taking any action that would cause an adjustment reducing the Purchase Price below the then par
value, if any, of the number of one one-thousandths of a share of Preferred Stock issuable upon exercise of the Rights, the Company shall take any corporate action that may, in the opinion of its counsel, be necessary in order that the Company may
validly and legally issue, fully paid and non-assessable, such number of one one-thousandths of a share of Preferred Stock at such adjusted Purchase Price. 

(l)      In any case in which this Section 11 shall require that an adjustment in the Purchase Price be
made effective as of a record date for a specified event, the Company may elect to defer until the occurrence of such event the issuance to the registered holder of any Right exercised after such record date of the number of one
one-

  
 23 

 
thousandths of a share of Preferred Stock and other capital stock or securities of the Company, if any, issuable upon such exercise over and above the number of one one-thousandths of a share of
Preferred Stock and other capital stock or securities of the Company, if any, issuable upon such exercise on the basis of the Purchase Price in effect prior to such adjustment; provided, however, that the Company shall deliver to such
holder a due bill or other appropriate instrument evidencing such holder’s right to receive such additional shares (fractional or otherwise) or securities upon the occurrence of the event requiring such adjustment. 

(m)      Anything in this Section 11 to the contrary notwithstanding, prior to the Distribution Date, the
Company shall be entitled to make such reductions in the Purchase Price, in addition to those adjustments expressly required by this Section 11, as and to the extent that in its good faith judgment the Board shall determine to be advisable in
order that any (i) consolidation or subdivision of the Preferred Stock, (ii) issuance wholly for cash of any Preferred Stock at less than the Current Market Price, (iii) issuance wholly for cash of Preferred Stock or securities that
by their terms are convertible into or exchangeable for Preferred Stock, (iv) stock dividends, or (v) issuance of rights, options, or warrants referred to in this Section 11, hereafter made by the Company to registered holders of its
Preferred Stock shall not be taxable to such stockholders or shall reduce the taxes payable by such holders. 

(n)      The Company covenants and agrees that in the event that a Section 11(a)(ii) Event occurs and the
Rights shall then be outstanding, it shall not, (i) consolidate with any other Person (other than a direct or an indirect wholly owned Subsidiary of the Company in a transaction that complies with Section 11(o) hereof), (ii) merge
with or into any other Person (other than a direct or an indirect wholly owned Subsidiary of the Company in a transaction that complies with Section 11(o) hereof), or (iii) sell or otherwise transfer (or permit any Subsidiary to sell or
otherwise transfer), in one transaction, or a series of related transactions, assets or earning power aggregating 50% or more of the assets or earning power of the Company and its Subsidiaries (taken as a whole and calculated on the basis of the
Company’s most recent regularly prepared financial statements) to any other Person or Persons (other than the Company and/or any of its direct or indirect wholly owned Subsidiaries in one or more transactions, each of which complies with
Section 11(o) hereof), if (A) at the time of or immediately after such consolidation, merger, sale, or transfer there are any charter or bylaw provisions, rights, warrants, or other instruments or securities outstanding or agreements in
effect that would substantially diminish or otherwise eliminate the benefits intended to be afforded by the Rights or (B) prior to, simultaneously with, or immediately after such consolidation, merger, sale, or transfer the stockholders of the
Person who constitutes, or would constitute, the “Principal Party” for purposes of Section 13(a) hereof shall have received a distribution of Rights previously owned by such Person or any of its Affiliates and Associates;
provided, however, this Section 11(n) shall not affect the ability of any Subsidiary of the Company to consolidate with, merge with or into, or sell or transfer assets or earning power to, any other Subsidiary of the Company. 

(o)      The Company covenants and agrees that in the event that a Section 11(a)(ii) Event occurs and the
Rights shall then be outstanding, it will not, except 

  
 24 

 
as permitted by Section 23, Section 24, or Section 27 hereof, take (or permit any Subsidiary to take) any action if at the time such action is taken it is reasonably foreseeable
that such action will diminish substantially or otherwise eliminate the benefits intended to be afforded by the Rights. 

(p)      Anything in this Agreement to the contrary notwithstanding, in the event that the Company shall at any
time after the Rights Dividend Declaration Date and prior to the Distribution Date (i) declare or pay a dividend on the outstanding Common Stock payable in shares of Common Stock, (ii) subdivide or split the outstanding Common Stock, or
(iii) combine or consolidate the outstanding Common Stock into a smaller number of shares, the number of Rights associated with each share of Common Stock then outstanding, or issued or delivered thereafter but prior to the Distribution Date
(or issued or delivered on or after the Distribution Date pursuant to Section 22 hereof), shall be proportionately adjusted so that the number of Rights thereafter associated with each share of Common Stock following any such event shall equal
the result obtained by multiplying the number of Rights associated with each share of Common Stock immediately prior to such event by a fraction, the numerator of which shall be the total number of shares of Common Stock outstanding immediately
prior to the occurrence of the event and the denominator of which shall be the total number of shares of Common Stock outstanding immediately following the occurrence of such event. The adjustment provided for in this Section 11(p) shall be
made successively whenever such a dividend is declared or paid or such a subdivision, split, combination, or reclassification is effected. If an event occurs that would require an adjustment under Section 11(a)(ii) and this Section 11(p),
the adjustment provided for in this Section 11(p) shall be in addition and prior to any adjustment required pursuant to Section 11(a)(ii). 

Section 12. Certificate of Adjusted Purchase Price or Number of Shares. 

Whenever an adjustment is made as provided in Section 11 and/or Section 13 hereof, the Company shall (a) promptly prepare a
certificate setting forth such adjustment and a brief statement of the facts accounting for such adjustment, (b) promptly file with the Rights Agent, and with each transfer agent for the Preferred Stock and the Common Stock, a copy of such
certificate, and (c) if a Distribution Date has occurred, mail a brief summary thereof to each registered holder of a Rights Certificate in accordance with Section 26 hereof, or if prior to the Distribution Date, disclose a brief summary
in a filing under the Exchange Act; provided, however, that the failure to give, or any defect in, any such disclosure shall not affect the legality or validity of such adjustment. The Rights Agent shall be fully protected in relying on any such
certificate and on any adjustments or statements therein contained and shall not be deemed to have knowledge of any such adjustment or event unless and until it shall have received a copy of such certificate. 

Section 13. Consolidation, Merger, or Sale or Transfer of Assets or Earning Power. 

(a)      In the event that, at any time after a Person has become an Acquiring Person, directly or indirectly,

  
 25 

 (i)      the Company shall consolidate with, or merge with and
into, any other Person (other than a direct or an indirect wholly owned Subsidiary of the Company in a transaction that complies with Section 11(o) hereof), and the Company shall not be the continuing or surviving corporation or other entity of
such consolidation or merger; 
 (ii)      any Person (other than a direct or an indirect wholly owned
Subsidiary of the Company in a transaction that complies with Section 11(o) hereof) shall consolidate with, or merge with or into, the Company, and the Company shall be the continuing or surviving corporation of such consolidation or merger
and, in connection with such consolidation or merger, all or part of the outstanding Common Stock shall be changed into or exchanged for stock or other securities of any other Person (or the Company) or cash or any other property; or 

(iii)      the Company shall sell or otherwise transfer (or one or more of its Subsidiaries shall sell or
otherwise transfer), in one transaction or a series of related transactions, assets or earning power aggregating 50% or more of the assets or earning power of the Company and its Subsidiaries (taken as a whole and calculated on the basis of the
Company’s most recent regularly prepared financial statements) to any Person or Persons (other than the Company or any of its direct or indirect wholly owned Subsidiaries in one or more transactions, each of which complies with
Section 11(o) hereof); 
             then, and in each such case, proper
provision shall be made so that: (A) each registered holder of a Right, except as provided in Section 7(e) hereof, shall thereafter have the right to receive, upon the exercise thereof at the then current Purchase Price in accordance with
the terms of this Agreement, such number of validly authorized and issued, fully paid, non-assessable, and freely tradeable Common Stock of the Principal Party, not subject to any liens, encumbrances, rights of first refusal, or other adverse
claims, as shall be equal to the result obtained by (1) multiplying the number of one one-thousandths of a share of Preferred Stock for which a Right was exercisable immediately prior to the first occurrence of a Section 11(a)(ii) Event by
the Purchase Price in effect immediately prior to such first occurrence of a Section 11(a)(ii) Event, and (2) dividing that product (which, following the first occurrence of a Section 13 Event, shall be referred to as the
“Purchase Price” for each Right and for all purposes of this Agreement) by 50% of the Current Market Price per share of Common Stock of such Principal Party on the date of consummation of such Section 13 Event; (B) such
Principal Party shall thereafter be liable for, and shall assume, by virtue of such Section 13 Event, all the obligations and duties of the Company pursuant to this Agreement; (C) the term “Company” shall thereafter be
deemed to refer to such Principal Party, it being specifically intended that the provisions of Section 11 hereof shall apply only to such Principal Party following the first occurrence of a Section 13 Event; (D) such Principal Party
shall take such steps (including, but not limited to, the reservation of a sufficient number of shares of Common Stock of such Principal Party) in connection with the consummation of any such transaction as may be necessary to assure that the
provisions hereof shall thereafter be applicable, as nearly as reasonably may be, in relation to its shares of Common Stock thereafter deliverable upon the exercise of the Rights; and (E) the provisions of

  
 26 

 
Section 11(a)(ii) hereof shall be of no effect with respect to events occurring at any time following the first occurrence of any Section 13 Event. 

(b)      “Principal Party” shall mean: 

(i)      in the case of any transaction described in Section 13(a)(i) or Section 13(a)(ii) hereof,
(A) the Person (including the Company as successor thereto or as the surviving entity) that is the issuer of any securities or other equity interests into which shares of Common Stock of the Company are converted, changed, or exchanged in such
merger or consolidation, or if there is more than one such issuer, the issuer of Common Stock that has the greatest aggregate market value, or (B) if no securities or other equity interests are so issued, the Person (including the Company as
successor thereto or as the surviving entity) that is the other constituent party to such merger or consolidation, or, if there is more than one such Person, the other Person that is a constituent party to such merger or consolidation, the Common
Stock of which has the greatest aggregate market value; and 
 (ii)      in the case of any transaction
described in Section 13(a)(iii) hereof, the Person that is the party receiving the greatest portion of the assets or earning power transferred pursuant to such transaction or transactions or, if each Person that is a party to such transaction
or transactions receives the same portion of the assets or earning power transferred pursuant to such transaction or transactions or if the Person receiving the largest portion of the assets or earning power cannot be determined, whichever of such
Persons is the issuer of Common Stock having the greatest aggregate value of shares outstanding; provided, however, that, in any such case, (A) if the Common Stock of such Person is not at such time and has not been continuously
over the preceding 12-month period registered under Section 12 of the Exchange Act, and such Person is a direct or an indirect Subsidiary of another Person, the Common Stock of which is and has been so
registered, “Principal Party” shall refer to such other Person; and (B) in case such Person is a Subsidiary, directly or indirectly, of more than one Person, the Common Stock of two or more of which are and have been so registered,
“Principal Party” shall refer to whichever of such Persons is the issuer of the Common Stock having the greatest aggregate market value. 

(c)      The Company shall not consummate a Section 13 Event unless the Principal Party shall have a
sufficient number of authorized shares of Common Stock that have not been issued or reserved for issuance to permit the exercise in full of the Rights in accordance with this Section 13, and unless prior thereto the Company and such Principal
Party shall have executed and delivered to the Rights Agent a supplemental agreement confirming that the requirements of Section 13(a) and Section 13(b) hereof shall promptly be performed in accordance with their terms and further
providing that, as soon as practicable after the date of any such Section 13 Event, the Principal Party will: 

(i)      prepare and file a registration statement under the Act, with respect to the Rights and the securities
purchasable upon exercise of the Rights on an appropriate form, and will use its best efforts to cause such registration statement to 

  
 27 

 
(A) become effective as soon as practicable after such filing and (B) remain effective (with a prospectus at all times meeting the requirements of the Act) until the Expiration Date;

 (ii)      take all such other action as may be necessary to enable the Principal Party to issue the
securities purchasable upon exercise of the Rights, including but not limited to, the registration or qualification of such securities under all requisite securities laws of jurisdictions of the various states and the listing of such securities on
such exchanges and trading markets as may be necessary or appropriate; and 
 (iii)      deliver to the
registered holders of the Rights historical financial statements for the Principal Party and each of its Affiliates that comply in all respects with the requirements for registration on Form 10 (or any successor form) under the Exchange Act.

 The provisions of this Section 13 shall similarly apply to successive mergers or consolidations or sales or other transfers. In the event that a
Section 13 Event shall occur at any time after the occurrence of a Section 11(a)(ii) Event, the Rights that have not theretofore been exercised shall thereafter become exercisable in the manner described in Section 13(a) hereof. 

Section 14. Fractional Rights and Fractional Shares. 

(a)      The Company shall not be required to issue fractions of Rights, except prior to the Distribution Date
as provided in Section 11(p) hereof, or to distribute Rights Certificates that evidence fractional Rights. In lieu of such fractional Rights, the Company shall pay to the registered holders of the Rights Certificates with regard to which such
fractional Rights would otherwise be issuable, an amount in cash equal to the same fraction of the current market value of a whole Right. For purposes of this Section 14(a), the current market value of a whole Right shall be the closing price
of the Rights for the Trading Day immediately prior to the date on which such fractional Rights would have been otherwise issuable. The closing price of the Rights for any Trading Day shall be the last sale price, regular way, or, in case no such
sale takes place on such day, the average of the closing bid and asked prices, regular way, in either case as reported in the principal consolidated transaction reporting system with respect to securities listed or admitted to trading on the NASDAQ
Global Select Market or, if the Rights are not listed or admitted to trading on the NASDAQ Global Select Market, as reported in the principal consolidated transaction reporting system with respect to securities listed on the principal national
securities exchange on which the Rights are listed or admitted to trading, or if the Rights are not listed or admitted to trading on any national securities exchange, the last quoted price or, if not so quoted, the average of the high bid and low
asked prices in the over-the-counter market, as reported by a quotation system then in use or, if on any such date the Rights are not so quoted, the average of the closing bid and asked prices as furnished by a professional market maker making a
market in the Rights, selected by the Board. If on any such date the Rights are not publicly held and are not so listed, admitted to trading, or quoted, and no market maker is making a market in the Rights, the current market value of a Right shall
mean the fair value of a Right on such date as determined in good faith by the 

  
 28 

 
Board, which determination shall be described in a statement filed with the Rights Agent and shall be conclusive for all purposes. 

(b)      The Company shall not be required to issue fractions of a share of Preferred Stock (other than
fractions that are integral multiples of one one-thousandth of a share of Preferred Stock) upon exercise of the Rights or to distribute certificates or book entries that evidence fractional shares of Preferred Stock (other than fractions that are
integral multiples of one one-thousandth of a share of Preferred Stock). In lieu of fractional shares of Preferred Stock that are not integral multiples of one one-thousandth of a share of Preferred Stock, the Company may pay to the registered
holders of Rights Certificates at the time such Rights are exercised as herein provided an amount in cash equal to the same fraction of the current market value of one one-thousandth of a share of Preferred Stock. For purposes of this
Section 14(b), the current market value of one one-thousandth of a share of Preferred Stock shall be one one-thousandth of the closing price of a share of Preferred Stock or, if unavailable, the appropriate alternative price (in each case, as
determined pursuant to Section 11(d)(ii) hereof) for the Trading Day immediately prior to the date of such exercise. 

(c)      Following the occurrence of a Triggering Event, the Company shall not be required to issue fractions
of Common Stock upon exercise of the Rights or to distribute certificates or Book Entry Shares that evidence fractional shares of Common Stock. In lieu of fractional shares of Common Stock, the Company may pay to the registered holders of Rights
Certificates at the time such Rights are exercised as herein provided an amount in cash equal to the same fraction of the current market value of one share of Common Stock. For purposes of this Section 14(c), the current market value of one
share of Common Stock shall be the closing price of one share of Common Stock or, if unavailable, the appropriate alternative price (in each case, as determined pursuant to Section 11(d)(i) hereof) on the Trading Day immediately prior to the
date of such exercise. 
 (d)      The registered holder of a Right, by the acceptance of that Right,
expressly waives such holder’s right to receive any fractional Rights or any fractional shares upon exercise of a Right, except as permitted by this Section 14. 

(e)      Whenever a payment for fractional Rights or fractional shares is to be made by the Rights Agent, the
Company shall (i) promptly prepare and deliver to the Rights Agent a certificate setting forth in reasonable detail the facts related to such payments and the prices and/or formulas utilized in calculating such payments, and (ii) provide
sufficient monies to the Rights Agent in the form of fully collected funds to make such payments. The Rights Agent shall be fully protected in relying upon such a certificate and shall have no duty with respect to, and shall not be deemed to have
knowledge of any payment for fractional Rights or fractional shares under any Section of this Agreement relating to the payment of fractional Rights or fractional shares unless and until the Rights Agent shall have received such a certificate and
sufficient monies. 
 Section 15. Rights of Action. All rights of action in respect of this Agreement, except for rights of action
given to the Rights Agent hereunder, including Section 18 and Section 20 hereof, are vested in the respective registered holders of the Rights Certificates 

  
 29 

 
(and, prior to the Distribution Date, of the Common Stock); and any registered holder of any Rights Certificate (and, prior to the Distribution Date, of the Common Stock), without the consent of
the Rights Agent or of the registered holder of any other Rights Certificate (or, prior to the Distribution Date, of the Common Stock), may, on such first holder’s own behalf and for such first holder’s own benefit, enforce this Agreement,
and may institute and maintain any suit, action or proceeding against the Company to enforce this Agreement, or otherwise enforce or act in respect of such first holder’s right to exercise the Rights evidenced by such Rights Certificate (or,
prior to the Distribution Date, of the Common Stock) in the manner provided in such Rights Certificate and in this Agreement. Without limiting the foregoing or any remedies available to the registered holders of Rights, it is specifically
acknowledged that the registered holders of Rights would not have an adequate remedy at law for any breach of this Agreement and shall be entitled to specific performance of the obligations hereunder, and injunctive relief against actual or
threatened violations of the obligations hereunder of any Person subject to this Agreement (including the Company). 
 Section 16.
Agreement of Rights Holders. Every registered holder of a Right, by accepting the same, consents and agrees with the Company and the Rights Agent and with every other registered holder of a Right that: 

(a)      prior to the Distribution Date, the Rights will be transferable only in connection with the transfer
of Common Stock, and the Rights will be evidenced by the balances indicated in the book entry account system of the transfer agent of the Common Stock registered in the names of the holders of such Common Stock or, in the case of certificated
shares, the certificates for the Common Stock registered in the names of the holders of the Common Stock; 

(b)      after the Distribution Date, the Rights Certificates are transferable only on the registry books of
the Rights Agent if surrendered at the office or offices of the Rights Agent designated for such purpose, duly endorsed or accompanied by a proper instrument of transfer and with the appropriate forms and certificates contained therein duly
executed; 
 (c)      subject to Section 6(a) and Section 7(f) hereof, the Company and the Rights
Agent may deem and treat the Person in whose name a Rights Certificate (or, prior to the Distribution Date, a Common Stock certificate or Book Entry Share) is registered as the absolute owner thereof and of the Rights evidenced thereby
(notwithstanding any notations of ownership or writing on the Rights Certificates or the associated Common Stock certificate made by anyone other than the Company or the Rights Agent) for all purposes whatsoever, and neither the Company nor the
Rights Agent, subject to the last sentence of Section 7(e) hereof, shall be affected by any notice to the contrary; and 

(d)      notwithstanding anything in this Agreement to the contrary, neither the Company nor the Rights Agent
shall have any liability to any registered holder of a Right or other Person as a result of its inability to perform any of its obligations under this Agreement by reason of any preliminary or permanent injunction or other order, decree, or ruling
issued by a court of competent jurisdiction or by a/an governmental, regulatory, or 

  
 30 

 
administrative agency or commission, or any applicable statute, rule, regulation, or executive order promulgated or enacted by any governmental authority, prohibiting or otherwise restraining
performance of such obligations; provided, however, that the Company must use its best efforts to have any such order, decree, or ruling lifted or otherwise overturned as soon as possible. 

Section 17. Rights Certificate Holder Not Deemed a Stockholder. No registered holder, as such, of any Rights Certificate shall be
entitled to vote, receive dividends, or be deemed for any purpose the registered holder of the Preferred Stock or any other securities of the Company that may at any time be issuable on the exercise of the Rights evidenced thereby, nor shall
anything contained herein or in any Rights Certificate be construed to confer upon the registered holder of any Rights Certificate, as such, any of the rights of a stockholder of the Company or any right to vote for the election of directors or upon
any matter submitted to stockholders at any meeting thereof, or to give or withhold consent to any corporate action, or to receive notice of meetings or other actions affecting stockholders (except as provided in Section 25 hereof), or to
receive dividends or subscription rights, or otherwise, until the Right or Rights evidenced by such Rights Certificate shall have been exercised in accordance with the provisions hereof. 

Section 18. Concerning the Rights Agent. 

(a)      The Company agrees to pay to the Rights Agent reasonable compensation for all services rendered by it
hereunder and, from time to time, on demand of the Rights Agent, its reasonable expenses and counsel fees and disbursements and other disbursements incurred in the administration and execution of this Agreement and the exercise and performance of
its duties hereunder. The Company also agrees to indemnify the Rights Agent for, and to hold it harmless against, any loss, liability or expense (including the reasonable and documented fees and expenses of outside legal counsel) incurred without
gross negligence, bad faith or willful misconduct (which gross negligence, bad faith or willful misconduct must be determined by a final, non-appealable order, judgment, decree or ruling of a court of competent jurisdiction) on the part of the
Rights Agent, for actions taken or omitted to be taken by the Rights Agent in connection with the acceptance and administration of this Agreement, including the costs and expenses of defending against any claim of liability resulting therefrom. 

(b)      Subject to Section 20(c), the Rights Agent shall be protected and shall incur no liability for,
or in respect of any action taken, suffered, or omitted by it in connection with its administration of this Agreement in reliance upon any Rights Certificate or certificate for Common Stock or for other securities of the Company or instrument of
assignment or transfer, power of attorney, endorsement, affidavit, letter, notice, direction, consent, certificate, statement, or other paper or document believed by it to be genuine and to have been signed, executed and, where necessary, verified
or acknowledged, by the proper Person or Persons, or otherwise upon the advice of counsel as set forth in Section 20 hereof. The Rights Agent shall not be deemed to have knowledge of any event of which it was supposed to receive notice thereof
hereunder, and the Rights Agent shall be fully protected and shall incur no liability for failing to take action in 

  
 31 

 
connection therewith, unless and until it has received such notice in writing in accordance with Section 26 hereof. 

(c)      The provisions of this Section 18 and Section 20 hereof shall survive the termination or
expiration of this Agreement, the exercise or expiration of the Rights and the resignation, replacement or removal of the Rights Agent. 

Section 19. Merger or Consolidation or Change of Name of the Rights Agent. 

(a)      Any Person into which the Rights Agent or any successor Rights Agent may be merged or with which it
may be consolidated, or any Person resulting from any merger or consolidation to which the Rights Agent or any successor Rights Agent shall be a party, or any Person succeeding to the corporate trust, stock transfer, or other shareholder services
business of the Rights Agent or any successor Rights Agent, shall be the successor to the Rights Agent under this Agreement without the execution or filing of any paper or any further act on the part of any of the parties hereto; but only if such
Person would be eligible for appointment as a successor Rights Agent under the provisions of Section 21 hereof. In case at the time such successor Rights Agent shall succeed to the agency created by this Agreement, any of the Rights
Certificates shall have been countersigned but not delivered, any such successor Rights Agent may adopt the countersignature of an authorized signatory of the predecessor Rights Agent and deliver such Rights Certificates so countersigned; and in
case at that time any of the Rights Certificates shall not have been countersigned, an authorized signatory of any successor Rights Agent may countersign such Rights Certificates either in the name of the predecessor or in the name of the successor
Rights Agent; and in all such cases, such Rights Certificates shall have the full force provided in the Rights Certificates and in this Agreement. 

(b)      In case at any time the name of the Rights Agent shall be changed and at such time any of the Rights
Certificates shall have been countersigned but not delivered, the Rights Agent may adopt the countersignature of an authorized signatory under the Rights Agent’s prior name and deliver the Rights Certificates so countersigned; and in case at
that time any of the Rights Certificates shall not have been countersigned, an authorized signatory of the Rights Agent may countersign such Rights Certificates either in the prior name of the Rights Agent or in the changed name of the Rights Agent;
and in all such cases, such Rights Certificates shall have the full force provided in the Rights Certificates and in this Agreement. 

Section 20. Duties of the Rights Agent. The Rights Agent undertakes to perform the duties and obligations as set forth in this
Agreement. The Rights Agent shall perform its duties and obligations hereunder upon the following terms and conditions, by all of which the Company and the registered holders of Rights Certificates, or, prior to the Distribution Date, of the Common
Stock, by their acceptance thereof, shall be bound: 
 (a)      The Rights Agent may consult with legal
counsel (who may be legal counsel for the Company), and the written opinion or advice of such counsel shall be full and complete authorization and protection to the Rights Agent, and, subject to Section

  
 32 

 
20(c), the Rights Agent shall incur no liability for or in respect of any action taken, suffered or omitted to be taken by it in good faith and in accordance with such written opinion or advice.

 (b)      Whenever in the performance of its duties under this Agreement, the Rights Agent shall deem it
necessary or desirable that any fact or matter (including, without limitation, the identity of any Acquiring Person and the determination of the Current Market Price) be proved or established by the Company prior to taking, suffering or omitting to
take any action hereunder, such fact or matter (unless other evidence in respect thereof be herein specifically prescribed) may be deemed to be conclusively proved and established by a certificate signed by the Chairman of the Board, the Chief
Executive Officer, the President, any Vice President, the Secretary, any Assistant Secretary, the Treasurer, or any Assistant Treasurer of the Company, and delivered to the Rights Agent; and such certificate shall be full authorization and
protection to the Rights Agent, and, subject to Section 20(c), the Rights Agent shall incur no liability for or in respect of any action taken, suffered or omitted to be taken in good faith by it under the provisions of this Agreement in
reliance upon such certificate. 
 (c)      The Rights Agent shall be liable hereunder only for its own and
its directors’, officers’, employees’, Affiliates’, agents’, advisors’ and representatives’ gross negligence, bad faith, or willful misconduct (which gross negligence, bad faith or willful misconduct must be
determined by a final, non-appealable order, judgment, decree or ruling of a court of competent jurisdiction). Notwithstanding anything in this Agreement to the contrary, any liability of the Rights Agent under this Agreement will be limited in the
aggregate to the amount of annual fees paid by the Company to the Rights Agent. Notwithstanding anything in this Agreement to the contrary, in no event shall either party hereto be liable for special, indirect or consequential loss or damage of any
kind whatsoever (including, but not limited to, lost profits), even if such party has been advised of the likelihood of such loss or damage and regardless of the form of action. 

(d)      The Rights Agent shall not be liable for or by reason of any of the statements of fact or recitals
contained in this Agreement or in the Rights Certificates (including in the case of Book Entry Shares, by notation in book entry accounts reflecting ownership that is directed by the Company) and it shall not be required to verify the same (except
as to a countersignature by one of its authorized signatories on such Rights Certificates), but all such statements and recitals are and shall be deemed to have been made by the Company only. 

(e)      The Rights Agent shall not have any liability for or be under any responsibility in respect of the
validity of this Agreement or the execution and delivery hereof (except the due authorization, execution and delivery hereof by the Rights Agent) or in respect of the legality or validity or execution of any Rights Certificate (including in the case
of Book Entry Shares, by notation in book entry accounts reflecting ownership as directed by the Company), except as to a countersignature by one of its authorized signatories on any such Rights Certificate; nor shall it be liable or responsible for
any breach by the Company of any covenant or condition contained in this Agreement or in any Rights Certificate; nor shall it be liable or responsible for any adjustment required 

  
 33 

 
hereunder, including under the provisions of Section 11, Section 13, or Section 24 hereof, or liable or responsible for the manner, method, or amount of any such adjustment or the
ascertaining of the existence of facts that would require any such adjustment (except with respect to the exercise of Rights evidenced by Rights Certificates after actual notice of any such adjustment has been provided by the Company); nor shall it
be liable or responsible for any determination by the Board of the Current Market Price under this Agreement; nor shall it by any act hereunder be deemed to make any representation or warranty as to the authorization or reservation of any shares of
Common Stock or Preferred Stock to be issued pursuant to this Agreement or any Rights Certificate or as to whether any shares of Common Stock or Preferred Stock will, when so issued, be validly authorized and issued, fully paid, and non-assessable.

 (f)      The Company agrees that it will perform, execute, acknowledge and deliver or cause to be
performed, executed, acknowledged and delivered all such further and other acts, instruments, and assurances as may reasonably be required or requested by the Rights Agent for the carrying out or performing by the Rights Agent of the provisions of
this Agreement. 
 (g)      The Rights Agent is hereby authorized and directed to accept instructions with
respect to the performance of its duties hereunder from the Chairman of the Board, the Chief Executive Officer, the President, any Vice President, the Secretary, any Assistant Secretary, the Treasurer, or any Assistant Treasurer of the Company, and
to apply to such officers for advice or instructions in connection with its duties under this Agreement, and such advice or instructions shall provide full authorization and protection to the Rights Agent, and, subject to Section 20(c), the
Rights Agent shall not be liable for any action taken, suffered or omitted to be taken by it in good faith in accordance with the advice or instructions of any such officer or for any delay in acting while waiting for these instructions. 

(h)      The Rights Agent and any stockholder, affiliate, member, director, officer, agent, representative or
employee of the Rights Agent (in each case, other than an Acquiring Person) may buy, sell, or deal in any of the Rights or other securities of the Company or become pecuniarily interested in any transaction in which the Company may be interested, or
contract with or lend money to the Company or otherwise act as fully and freely as though it were not the Rights Agent under this Agreement. Nothing herein shall preclude the Rights Agent or any such stockholder, affiliate, member, director,
officer, agent, representative or employee of the Rights Agent from acting in any other capacity for the Company or for any other Person. 

(i)      The Rights Agent may execute and exercise any of the rights or powers hereby vested in it or perform
any duty hereunder either itself or by or through its attorneys or agents, and the Rights Agent shall not be answerable or accountable for any act, omission, default, neglect or misconduct of any such attorneys or agents or for any loss to the
Company, to the registered holders of the Rights or to any other Person resulting from any such act, omission, default, neglect or misconduct, absent gross negligence, bad faith or willful misconduct in the selection and continued employment thereof
(which 

  
 34 

 
gross negligence, bad faith or willful misconduct must be determined by a final, non-appealable order, judgment, decree or ruling of a court of competent jurisdiction). 

(j)      No provision of this Agreement shall require the Rights Agent to expend or risk its own funds or
otherwise incur any financial liability in the performance of any of its duties hereunder or in the exercise of any of its rights or powers if there shall be reasonable grounds for believing that repayment of such funds or adequate indemnification
against such risk or liability is not reasonably assured to it. 
 (k)      If, with respect to any Rights
Certificate surrendered to the Rights Agent for exercise or transfer, the certificate contained in the form of assignment or the form of election to purchase set forth on the reverse thereof, as the case may be, has either not been properly
completed or indicates an affirmative response to clause 1 or 2 thereof, or any other actual or suspected irregularity exists, the Rights Agent shall not take any further action with respect to such requested exercise or transfer without first
consulting with the Company. 
 Section 21. Change of the Rights Agent. The Rights Agent or any successor Rights Agent may resign and
be discharged from its duties under this Agreement upon thirty (30) days’ notice given to the Company in accordance with Section 26 hereof, and to each transfer agent of the Common Stock and the Preferred Stock by registered or
certified mail, in the event that the Rights Agent or one of its Affiliates is not also the transfer agent for the Company. In the event the transfer agency relationship in effect between the Company and the Rights Agent terminates, the Rights Agent
shall be deemed to have resigned automatically and be discharged from its duties under this Agreement as of the effective date of such termination, and the Company shall be responsible for sending any required notice. The Company may remove the
Rights Agent or any successor Rights Agent upon thirty (30) days’ notice given to the Rights Agent or successor Rights Agent, as the case may be, in accordance with Section 26 hereof, and to each transfer agent of the Common Stock and
the Preferred Stock by registered or certified mail, and, if such removal occurs after the Distribution Date, to the registered holders of the Rights Certificates in accordance with Section 26 hereof. If the Rights Agent shall resign or be
removed or shall otherwise become incapable of acting, the Company shall appoint a successor to the Rights Agent. If the Company shall fail to make such appointment within a period of thirty (30) days after giving proper notice of such removal
or after it has been properly notified of such resignation or incapacity by the resigning or incapacitated Rights Agent or by the registered holder of a Rights Certificate (who shall, with such notice, submit such holder’s Rights Certificate
for inspection by the Company), then any registered holder of any Rights Certificate may apply to any court of competent jurisdiction for the appointment of a new Rights Agent. Any successor Rights Agent, whether appointed by the Company or by such
a court, shall be (a) a legal business entity organized and doing business under the laws of the United States or of any state of the United States, in good standing, which is authorized under such laws to exercise corporate trust, stock
transfer, or shareholder services powers and which has, along with its Affiliates, at the time of its appointment as Rights Agent a combined capital and surplus of at least $50 million or (b) an Affiliate of a legal business entity
described in clause (a) of this sentence. After appointment, the successor Rights Agent shall be vested with the same 

  
 35 

 
powers, rights, duties and responsibilities as if it had been originally named as Rights Agent without further act or deed; but the predecessor Rights Agent shall deliver and transfer to the
successor Rights Agent any property at the time held by it hereunder, and execute and deliver any further assurance, conveyance, act, or deed necessary for that purpose. Not later than the effective date of any such appointment, the Company shall
give notice thereof in writing to the predecessor Rights Agent and each transfer agent of the Common Stock and the Preferred Stock in accordance with Section 26 hereof, and, if such appointment occurs after the Distribution Date, give notice
thereof to the registered holders of the Rights Certificates in accordance with Section 26 hereof. Failure to give any notice provided for in this Section 21, however, or any defect therein, shall not affect the legality or validity of the
resignation or removal of the Rights Agent or the appointment of the successor Rights Agent, as the case may be. 
 Section 22. Issuance
of New Rights Certificates. Notwithstanding any of the provisions of this Agreement or of the Rights Certificates to the contrary, the Company may, at its option, issue new Rights Certificates evidencing Rights in such form as may be approved by
the Board to reflect any adjustment or change in the Purchase Price and the number or kind or class of shares or other securities or property purchasable under the Rights Certificates made in accordance with the provisions of this Agreement. In
addition, in connection with the issuance or sale of the Common Stock following the Distribution Date and prior to the Expiration Date, the Company (a) shall, with respect to the Common Stock so issued or sold pursuant to the exercise of stock
options or under any employee plan or arrangement, granted or awarded as of the Distribution Date, or upon the exercise, conversion, or exchange of securities hereinafter issued by the Company, and (b) may, in any other case, if deemed
necessary or appropriate by the Board, issue Rights Certificates evidencing the appropriate number of Rights in connection with such issuance or sale; provided, however, that (i) no such Rights Certificate shall be issued if, and
to the extent that, the Company shall be advised by counsel that such issuance would create a significant risk of material adverse tax consequences to the Company or the Person to whom such Rights Certificate would be issued, and (ii) no such
Rights Certificate shall be issued if, and to the extent that, appropriate adjustment shall otherwise have been made in lieu of the issuance thereof. 

Section 23. Redemption and Termination. 

(a)      The Board may, at its option, at any time prior to the earlier of (i) the Distribution Date and
(ii) the Expiration Date, direct the Company to, and if so directed, the Company shall, redeem all but not less than all of the then outstanding Rights at a redemption price of $0.01 per Right, as such amount may be appropriately adjusted to
reflect any stock split, stock dividend, or similar transaction occurring after the date hereof (such redemption price being hereinafter referred to as, the “Redemption Price”). The redemption of the Rights by the Board pursuant to
this paragraph (a) may be made effective at such time, on such basis, and with such conditions as the Board, in its sole discretion, may establish. The Company may, at its option, pay the Redemption Price in cash, shares of Common Stock (based
on the Current Market Price of the Common Stock at the time of redemption) or any other form of consideration deemed appropriate by the Board. 

  
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 (b)      Immediately upon the action of the Board directing the
Company to redeem the Rights pursuant to paragraph (a) of this Section 23, evidence of which shall have been filed with the Rights Agent, and without any further action and without any notice, the right to exercise the Rights will
terminate and the only right thereafter of the registered holders of Rights shall be to receive the Redemption Price for each Right so held. Promptly after the action of the Board directing the Company to redeem the Rights pursuant to
paragraph (a) of this Section 23, the Company shall promptly give notice of such redemption to the Rights Agent and the registered holders of the then outstanding Rights in accordance with Section 26 hereof; provided,
however, that failure to give, or any defect in, any such notice shall not affect the validity of such redemption. Any such notice given to such holders in accordance with Section 26 hereof shall be deemed given whether or not such
holders receive the notice. Each such notice of redemption will state the method by which the payment of the Redemption Price will be made. 

Section 24. Exchange of Rights. 

(a)      The Board may, at its option, at any time after the occurrence of a Section 11(a)(ii) Event,
direct the Company to, and if so directed, the Company shall, exchange all or part of the then outstanding and exercisable Rights (which shall not include Rights that have become null and void pursuant to the provisions of Section 7(e) hereof)
for Common Stock at an exchange ratio of one share of Common Stock per Right, appropriately adjusted to reflect any stock split, stock dividend, or similar transaction occurring after the date hereof (such exchange ratio being hereinafter referred
to as, the “Exchange Ratio”). The exchange of the Rights by the Board may be made effective at such time, on such basis, and with such conditions as the Board, in its sole discretion, may establish. Notwithstanding the foregoing,
the Board shall not be empowered to direct the Company to effect such exchange at any time after any Person (other than an Exempt Person), together with all Affiliates and Associates of such Person, becomes the Beneficial Owner of 50% or more of the
Common Stock then outstanding. 
 (b)      Immediately upon the action of the Board directing the Company to
exchange any Rights pursuant to Section 24(a) hereof and without any further action and without any notice, the right to exercise such Rights shall terminate and the only right thereafter of a registered holder of such Rights shall be to
receive that number of shares of Common Stock equal to the number of such Rights held by such holder multiplied by the Exchange Ratio. The Company shall promptly give public notice of any such exchange; provided, however, that the
failure to give, or any defect in, such notice shall not affect the validity of such exchange. The Company promptly shall give notice of any such exchange to all of the registered holders of such Rights in accordance with Section 26 hereof. Any
notice given in accordance with Section 26 hereof shall be deemed given, whether or not the holder receives the notice. Each such notice of exchange will state the method by which the exchange of the Common Stock for Rights will be effected
and, in the event of any partial exchange, the number of Rights that will be exchanged. Any partial exchange shall be effected pro rata based on the number of Rights (other than Rights that have become null and void pursuant to the provisions of
Section 7(e) hereof) held by each registered holder of Rights. 

  
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 (c)      In any exchange pursuant to this Section 24, the
Company, at its option, may substitute shares of Preferred Stock (or Equivalent Preferred Stock, as such term is defined in Section 11(b) hereof) for Common Stock exchangeable for Rights, at the initial rate of one one-thousandth of a share of
Preferred Stock (or Equivalent Preferred Stock) for each share of Common Stock, as appropriately adjusted to reflect stock splits, stock dividends, and other similar transactions after the date hereof. 

(d)      In the event the number of shares of Common Stock authorized by the Certificate of Incorporation, but
which are not outstanding or reserved for issuance for purposes other than upon exercise of the Rights, is not sufficient to permit any exchange of Rights as contemplated in accordance with this Section 24, the Company shall use its best
efforts to cause all such action to be taken as may be necessary to authorize additional shares of Common Stock for issuance upon exchange of the Rights. 

(e)      The Company shall not be required to issue fractions of Common Stock or to distribute certificates or
Book Entry Shares that evidence fractional shares of Common Stock. In lieu of such fractional shares of Common Stock, the Company shall pay to the registered holders of the Rights Certificates with regard to which such fractional shares of Common
Stock would otherwise be issuable, an amount in cash equal to the same fraction of the current market value of a whole share of Common Stock. For the purposes of this Section 24(e), the current market value of a whole share of Common Stock
shall be the closing price of a share of Common Stock (as determined pursuant to the second sentence of Section 11(d)(i) hereof) for the Trading Day immediately prior to the date of exchange pursuant to this Section 24. 

(f)      Following the action of the Board ordering the exchange of any Rights pursuant to this
Section 24, the Company may implement such procedures as it deems appropriate, in its sole discretion, for the purpose of ensuring that the Common Stock (or other consideration) issuable upon an exchange pursuant to this Section 24 is not
received by any holder of Rights that have become null and void pursuant to Section 7(e). Prior to effecting an exchange pursuant to this Section 24, the Board may direct the Company to enter into a trust agreement in such form and with
such terms as the Board shall then approve (the “Trust Agreement”). If the Board so directs, the Company shall enter into the Trust Agreement and shall issue to the trust created by such agreement (the “Trust”) all
or a portion (as designated by the Board) of the Common Stock, fractional shares of Preferred Stock, or other securities, if any, issuable pursuant to the exchange, and all Persons entitled to receive such shares or other securities (and any
dividends or distributions made thereon after the date on which such shares or other securities are deposited in the Trust) shall be entitled to receive such only from the Trust and solely upon compliance with the relevant terms and provisions of
the Trust Agreement. Prior to effecting an exchange and registering shares of Common Stock (or other securities) in any Person’s name, including any nominee or transferee of a Person, the Company may require (or cause the trustee of the Trust
to require), as a condition thereof, that any holder of Rights provide evidence, including, without limitation, the identity of the Beneficial Owners thereof and their Affiliates and Associates (or former Beneficial Owners thereof and their
Affiliates and Associates) as the Company shall reasonably request in order to determine if such Rights are null and void. If any Person shall fail to comply with such 

  
 38 

 
request, the Company shall be entitled to deem the Rights formerly held or exchangeable by such Person to be null and void pursuant to Section 7(e) and not transferable or exercisable or
exchangeable in connection herewith. Any shares of Common Stock or other securities issued at the direction of the Board in connection herewith shall be validly issued, fully paid, and non-assessable shares of Common Stock or of other securities (as
the case may be), and the Company shall be deemed to have received as consideration for such issuance a benefit having a value that is at least equal to the aggregate par value of the shares or other securities so issued. 

Section 25. Notice of Certain Events. 

(a)      In case the Company shall propose, at any time after the Distribution Date, (i) to pay any
dividend payable in stock of any class or series to the registered holders of Preferred Stock or to make any other distribution to the registered holders of Preferred Stock (other than a regular periodic cash dividend out of earnings or retained
earnings of the Company), or (ii) to offer to the registered holders of Preferred Stock rights or warrants to subscribe for or to purchase any additional shares of Preferred Stock or shares of stock of any class or any other securities, rights,
or options, or (iii) to effect any reclassification of its Preferred Stock (other than a reclassification involving only the subdivision of outstanding Preferred Stock), or (iv) to effect any consolidation or merger into or with any other
Person (other than a direct or an indirect, wholly owned Subsidiary of the Company in a transaction that complies with Section 11(o) hereof), or to effect any sale or other transfer (or to permit one or more of its Subsidiaries to effect any
sale or other transfer), in one transaction or a series of related transactions, of 50% or more of the assets or earning power of the Company and its Subsidiaries (taken as a whole and calculated on the basis of the Company’s most recent and
regularly prepared financial statements) to any other Person or Persons (other than the Company or any of its direct or indirect wholly owned Subsidiaries in one or more transactions, each of which complies with Section 11(o) hereof), or
(v) to effect the liquidation, dissolution, or winding up of the Company, then, in each such case, the Company shall give to the Rights Agent and to each registered holder of a Rights Certificate, in accordance with Section 26 hereof, a
notice of such proposed action, which shall specify the record date for the purposes of such stock dividend, distribution of rights or warrants, or the date on which such reclassification, consolidation, merger, sale, transfer, liquidation,
dissolution, or winding up is to take place and the date of participation therein by the registered holders of the Preferred Stock, if any such date is to be fixed, and such notice shall be so given in the case of any action covered by
clause (i) or (ii) above at least 20 days prior to the record date for determining registered holders of the Preferred Stock for purposes of such action, and in the case of any such other action, at least 20 days prior to the date of the
taking of such proposed action or the date of participation therein by the registered holders of the Preferred Stock, whichever shall be the earlier; provided, however, that no such action shall be taken pursuant to this
Section 25(a) that will or would conflict with any provision of the Certificate of Incorporation; provided, further, that no such notice shall be required pursuant to this Section 25, if any Subsidiary of the Company effects
a consolidation or merger with or into, or effects a sale or other transfer of assets or earnings power to, any other Subsidiary of the Company. 

  
 39 

 (b)       In case a Section 11(a)(ii) Event shall occur,
then, in any such case, (i) the Company shall as soon as practicable thereafter give to each registered holder of a Rights Certificate, in accordance with Section 26 hereof, a notice of the occurrence of such event, which shall specify the
event and the consequences of the event to registered holders of Rights under Section 11(a)(ii) hereof, and (ii) all references in Section 25(a) to shares of Preferred Stock shall be deemed thereafter to refer to shares of Common
Stock or, if appropriate, other securities. 
 Section 26. Notices. Notices or demands authorized by this Agreement to be given or
made by the Rights Agent or by the registered holder of any Rights Certificate to or on the Company shall be sufficiently given or made if sent by (a) first-class mail, postage prepaid, (b) overnight delivery service, (c) courier or
messenger service, or (d) fax (when such fax is transmitted to the fax number set forth below and confirmation of transmission is received), in each case addressed (until another address is filed in writing by the Company with the Rights Agent)
as follows: 
 Arrowhead Pharmaceuticals, Inc. 

Attention: Corporate Secretary 

225 South Lake Avenue, Suite 1050 

Pasadena, CA 91101 
 Attention:
General Counsel 
 Fax: (626) 304-3401 

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

Gibson, Dunn & Crutcher LLP 

555 Mission Street, Suite 3000 

San Francisco, California 94105 

Attn: Ryan A. Murr 
 Facsimile:
(415) 374-8430 
 Subject to the provisions of Section 21 hereof, any notice or demand authorized by this Agreement to be given or made by the
Company or by the registered holder of any Rights Certificate to or on the Rights Agent shall be sufficiently given or made if sent by (i) first-class mail, postage prepaid, (ii) overnight delivery service, or (iii) courier or
messenger service, in each case addressed (until another address is filed in writing by the Rights Agent with the Company) as follows: 

Computershare Trust Company, N.A. 

250 Royall Street 
 Canton, MA
02021 
 Attention: Client Services 

Notices or demands authorized by this Agreement to be given or made by the Company or the Rights Agent to the registered holder of any Rights
Certificate (or, if prior to the Distribution Date, of the Common Stock) shall be sufficiently given or made if sent 

  
 40 

 
by first-class mail, postage prepaid, or overnight delivery service, addressed to such holder at the address of such holder as shown on the registry books of the Company or the Rights Agent (or,
if prior to the Distribution Date, of the transfer agent or registrar for the Common Stock). 
 Section 27. Supplements and
Amendments. Except as otherwise provided in this Section 27, the Company, by action of the Board, may from time to time and in its sole and absolute discretion, and the Rights Agent shall, if the Company so directs, supplement or amend any
provision of this Agreement in any respect without the approval of any registered holders of the Rights, including, without limitation, in order to (a) cure any ambiguity, (b) correct or supplement any provision contained herein that may
be defective or inconsistent with any other provisions herein, (c) shorten or lengthen any time period hereunder, or (d) otherwise change, amend, or supplement any provisions hereunder in any manner that the Company may deem necessary or
desirable; provided, however, that, from and after the occurrence of a Section 11(a)(ii) Event, no such supplement or amendment shall adversely affect the interests of the registered holders of Rights Certificates (other than an
Acquiring Person or an Affiliate or Associate of an Acquiring Person or certain of their respective transferees) or shall cause this Agreement to become amendable other than in accordance with this Section 27. Without limiting the foregoing,
the Company, by action of the Board, may at any time before any Person becomes an Acquiring Person amend or supplement this Agreement to make provisions of this Agreement inapplicable to a particular transaction by which a Person might otherwise
become an Acquiring Person or to otherwise alter the terms and conditions of this Agreement as they may apply with respect to any such transaction. Any such amendment or supplement shall be evidenced by a writing signed by the Company and the Rights
Agent. Upon the delivery of a certificate from an appropriate officer of the Company that states that the proposed supplement or amendment is in compliance with the terms of this Section 27, an authorized signatory of the Rights Agent shall
execute such supplement or amendment; provided, however, that the Rights Agent may, but shall not be obligated to, enter into any supplement or amendment that adversely affects the Rights Agent’s own rights, duties, or obligations
under this Agreement. 
 Section 28. Successors. All the covenants and provisions of this Agreement by or for the benefit of the
Company or the Rights Agent shall bind and inure to the benefit of their respective successors and assigns hereunder. 
 Section 29.
Determinations and Actions by the Board. The Board shall have the exclusive power and authority to administer this Agreement and to exercise all rights and powers specifically granted to the Board or to the Company, or as may be necessary or
advisable in the administration of this Agreement, including, without limitation, the right and power to (a) interpret the provisions of this Agreement and (b) make all determinations deemed necessary or advisable for the administration of
this Agreement (including a determination to redeem or to not redeem the Rights or to amend this Agreement). Without limiting the rights of the Rights Agent under this Agreement, all such actions, calculations, interpretations, and determinations
that are done or made by the Board in good faith, shall be final, conclusive, and binding on the Company, the Rights Agent, the registered holders of the Rights, and all other parties to the fullest extent permitted by

  
 41 

 
applicable law. The Rights Agent is always entitled to assume that the Board acted in good faith and shall be fully protected, and incur no liability in reliance thereon. 

Section 30. Benefits of this Agreement. Nothing in this Agreement shall be construed to give to any Person other than the Company, the
Rights Agent, and the registered holders of the Rights Certificates (and, prior to the Distribution Date, of the Common Stock) any legal or equitable right, remedy, or claim under this Agreement; and this Agreement shall be for the sole and
exclusive benefit of the Company, the Rights Agent, and the registered holders of the Rights Certificates (and, prior to the Distribution Date, of the Common Stock). 

Section 31. Severability. If any term, provision, covenant, or restriction of this Agreement is held by a court of competent
jurisdiction or other authority to be invalid, void, or unenforceable, the remainder of the terms, provisions, covenants, and restrictions of this Agreement shall remain in full force and effect and shall in no way be affected, impaired, or
invalidated; provided, however, that notwithstanding anything in this Agreement to the contrary, if any such term, provision, covenant, or restriction is held by such court or authority to be invalid, void, or unenforceable, and the
Board determines in its good faith judgment that severing such invalid, void, or unenforceable term, provision, covenant, or restriction from this Agreement would adversely affect the purpose or effect of this Agreement, the right of redemption as
set forth in Section 23 hereof shall be reinstated and shall not expire until the Close of Business on the 10th Business Day following the date of such determination by the Board; provided, however, that if any such excluded term,
provision, covenant, or restriction shall adversely affect the rights, immunities, duties or obligations of the Rights Agent, the Rights Agent shall be entitled to resign immediately. 

Section 32. Governing Law. This Agreement, each Right, and each Rights Certificate issued hereunder shall be deemed to be a contract
made under the laws of the State of Delaware and for all purposes shall be governed by and construed in accordance with the laws of such State applicable to contracts made and to be performed entirely within such State. 

Section 33. Counterparts. This Agreement may be executed in any number of counterparts and each of such counterparts shall for all
purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument. A signature to this Agreement executed and/or transmitted electronically shall have the same authority, effect, and
enforceability as an original signature. 
 Section 34. Descriptive Headings. Descriptive headings of the several Sections of this
Rights Agreement are inserted for convenience only and shall not control or affect the meaning or construction of any of the provisions hereof. 

Section 35. Force Majeure. Notwithstanding anything to the contrary contained herein, the Rights Agent shall not be liable for any
delays or failures in performance resulting from acts beyond its reasonable control including, without limitation, acts of God, terrorist acts, shortage of supply, breakdowns or malfunctions, interruptions or malfunction

  
 42 

 
of computer facilities, or loss of data due to power failures or mechanical difficulties with information storage or retrieval systems, labor difficulties, war, or civil unrest. 

[The remainder of this page is intentionally left blank.] 

  
 43 

 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the
day and year first above written. 
  

			
	 ARROWHEAD PHARMACEUTICALS,

INC.

		
	By: 	 	/s/ Christopher Anzalone
		 	Christopher Anzalone
		 	President & Chief Executive Officer

  

			
	 COMPUTERSHARE TRUST COMPANY,

N.A.

		
	By: 	 	/s/ Dennis V. Moccia
		 	Dennis V. Moccia
		 	Manager, Contract Administration

 SIGNATURE PAGE TO RIGHTS
AGREEMENT 

 EXHIBIT A 

Exhibit A to Rights Agreement filed as Exhibit 3.1 to Form 8-K filed with the SEC on March 23,
2017. 

 EXHIBIT B 

FORM OF RIGHTS CERTIFICATE 
  

			
	Certificate No. R-	  	                     Rights

 NOT EXERCISABLE AFTER MARCH 21, 2018 OR EARLIER IF REDEEMED OR EXCHANGED BY THE COMPANY. THE RIGHTS ARE
SUBJECT TO REDEMPTION, AT THE OPTION OF THE COMPANY, AT $0.01 PER RIGHT ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT. UNDER CERTAIN CIRCUMSTANCES AS SET FORTH IN THE RIGHTS AGREEMENT, RIGHTS BENEFICIALLY OWNED BY ANY PERSON WHO IS, WAS, OR BECOMES
AN ACQUIRING PERSON OR ANY AFFILIATE OR ASSOCIATE THEREOF (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT), WHETHER CURRENTLY BENEFICIALLY OWNED BY OR ON BEHALF OF SUCH PERSON OR BY ANY SUBSEQUENT BENEFICIAL OWNER, MAY BECOME NULL AND VOID.

 Rights Certificate 

ARROWHEAD PHARMACEUTICALS, INC. 

This certifies that
                                , or registered assigns, is the registered owner
of the number of Rights set forth above, each of which entitles the owner thereof, subject to the terms, provisions, and conditions of the Rights Agreement, dated as of March 21, 2017 (the “Rights Agreement”), between Arrowhead
Pharmaceuticals, Inc., a Delaware corporation (the “Company”), and Computershare Trust Company, N.A., a federally chartered trust company (the “Rights Agent”), to purchase from the Company at any time prior to 5:00
p.m., New York time, on March 21, 2018, at the office or offices of the Rights Agent designated for such purpose, or its successor(s) as Rights Agent, one one-thousandth of a fully paid, non-assessable share of Series D Junior Participating
Preferred Stock, par value $0.001 per share, of the Company (the “Preferred Stock”), at a purchase price of $20 per one one-thousandth of a share of Preferred Stock (such purchase price, as may be adjusted, the “Purchase
Price”), upon presentation and surrender of this Rights Certificate, along with the applicable form of election to purchase and related certificate duly executed. The number of Rights evidenced by this Rights Certificate (and the number of
shares that may be purchased upon the exercise thereof) as set forth above, and the Purchase Price per share as set forth above, are the number and the Purchase Price as of March 22, 2017, based on the Preferred Stock as constituted on
such date. The Company reserves the right to require prior to the occurrence of a Triggering Event (as such term is defined in the Rights Agreement) that a number of Rights be exercised so that only whole shares of Preferred Stock will be issued.

 Upon the occurrence of a Section 11(a)(ii) Event (as such term is defined in the Rights Agreement), if the Rights evidenced by this
Rights Certificate are beneficially 

  
 B-1 

 
owned by (i) an Acquiring Person or an Affiliate or Associate of an Acquiring Person (as such terms are defined in the Rights Agreement), (ii) a transferee of an Acquiring Person (or of
any such Associate or Affiliate), or (iii) under certain circumstances as specified in the Rights Agreement, a transferee of a person who, after such transfer, became an Acquiring Person, or an Affiliate or Associate of an Acquiring Person,
such Rights shall become null and void and no holder hereof shall have any right with respect to such Rights from and after the occurrence of such Section 11(a)(ii) Event. 

As provided in the Rights Agreement, the Purchase Price, the number and kind of shares of Preferred Stock or other securities issuable upon
the exercise of a Right, and the number of Rights outstanding are subject to modification and adjustment upon the happening of certain events, including Triggering Events. 

This Rights Certificate is subject to all of the terms, provisions, and conditions of the Rights Agreement, which terms, provisions, and
conditions are hereby incorporated herein by reference and made a part hereof and to which Rights Agreement reference is hereby made for a full description of the rights, limitations of rights, obligations, duties, and immunities hereunder of the
Rights Agent, the Company, and the holders of the Rights Certificates, which limitations of rights include the temporary suspension of the exercisability of such Rights under the specific circumstances as set forth in the Rights Agreement. Copies of
the Rights Agreement are on file at the above-mentioned office of the Rights Agent, and are available free of charge upon written request to the Rights Agent or the Company. 

This Rights Certificate, with or without other Rights Certificates, upon surrender at the office or offices of the Rights Agent designated for
such purpose, may be exchanged for another Rights Certificate or Rights Certificates of like tenor and date evidencing Rights entitling the holder to purchase a like aggregate number of one one-thousandths of a share of Preferred Stock as the Rights
evidenced by the Rights Certificate or Rights Certificates surrendered shall have entitled such holder to purchase. If this Rights Certificate shall be exercised in part, the holder shall be entitled to receive upon surrender hereof another Rights
Certificate or Rights Certificates for the number of whole Rights not exercised. 
 Subject to the provisions of the Rights Agreement, the
Rights evidenced by this Rights Certificate may be redeemed by the Company at its option at a redemption price of $0.01 per Right, payable at the Company’s option in cash or other securities or property of the Company, subject to adjustment for
certain events as provided in the Rights Agreement, at any time prior to the earlier of (i) the Distribution Date and (ii) the Expiration Date (as such terms are defined in the Rights Agreement). In addition, under certain circumstances
following the occurrence of a Section 11(a)(ii) Event, but before any person acquires beneficial ownership of 50% or more of the Common Stock (as such term is defined in the Rights Agreement), the Rights may be exchanged, in whole or in part,
for shares of Common Stock, Preferred Stock, or shares of other preferred stock of the Company having essentially the same value or economic rights as such shares. Immediately upon the action of the Board authorizing any such redemption or exchange,
and without any further action or any notice, the Rights (other than Rights that are not 

  
 B-2 

 
subject to such redemption or exchange) will terminate and the Rights will only enable holders to receive the redemption price or the shares issuable upon such exchange, as applicable. 

No fractional shares of Preferred Stock will be issued upon the exercise of any Right or Rights evidenced hereby (other than fractions that
are integral multiples of one one-thousandth of a share of Preferred Stock, which may, at the election of the Company, be evidenced by depositary receipts), but in lieu thereof a cash payment may be made, as provided in the Rights Agreement. 

No holder of this Rights Certificate shall be entitled to vote or receive dividends or be deemed for any purpose the holder of Preferred Stock
or of any other securities of the Company that may at any time be issuable on the exercise hereof, nor shall anything contained in the Rights Agreement or herein be construed to confer upon the holder hereof, as such, any of the rights of a
stockholder of the Company or any right to vote for the election of directors or upon any matter submitted to stockholders at any meeting thereof, or to give consent to or withhold consent from any corporate action, or, to receive notice of meetings
or other actions affecting stockholders (except as provided in the Rights Agreement), or to receive dividends or subscription rights, or otherwise, until the Right or Rights evidenced by this Rights Certificate shall have been exercised as provided
in the Rights Agreement. 
 This Rights Certificate shall not be valid or obligatory for any purpose until it shall have been countersigned
by an authorized signatory of the Rights Agent. 

  
 B-3 

 WITNESS the facsimile signature of the proper officer(s) of the Company and its corporate seal.

 Dated as of                     
            , 20        . 
  

			
	ARROWHEAD PHARMACEUTICALS, INC.
		
	By:	 	 
		 	Name: Kenneth Myszkowski
		 	Title: Chief Financial Officer

 Countersigned: 

COMPUTERSHARE TRUST COMPANY, N.A. 
  

			
		
	By:	 	 
		 	    Authorized Signature

  
 B-4 

 [Form of Reverse Side of Rights Certificate] 

FORM OF ASSIGNMENT 
 (To be
executed by the registered holder if such 
 holder desires to transfer the Rights Certificate.) 

FOR VALUE RECEIVED                  
                                         
                               hereby sells, assigns
and transfers unto                                    
                                         
                                         
                                

 
  

(Please print name and address of transferee) 
  

 
  

 
 (Please spell out and include in
numerals the 
 number of Rights being transferred by this Assignment) 

of the Rights evidenced by this Rights Certificate, together with all right, title and interest therein, and does hereby irrevocably constitute and appoint
                                        
as attorney-in-fact to transfer the number of Rights indicated above on the books of the within named Company, with full power of substitution. 
 Dated:
                                ,
             
  

	
	
	   

	Signature

 Medallion Signature Guaranteed: 

  
 B-5 

 Certificate 

The undersigned hereby certifies by checking the appropriate boxes that: 

(1)        the Rights evidenced by this Rights Certificate [    ] are
[    ] are not being sold, assigned, and transferred by or on behalf of a Person who is or was an Acquiring Person or an Affiliate or Associate of any such Acquiring Person (as such terms are defined pursuant to the Rights
Agreement); and 
 (2)        after due inquiry and to the best knowledge of the undersigned, he,
she, or it [    ] did [    ] did not acquire the Rights evidenced by this Rights Certificate from any Person who is, was, or subsequently became an Acquiring Person or an Affiliate or Associate
of an Acquiring Person. 
  

							
				
	Dated:                                 ,
            	 		 		 	  

		 		 		 	Signature

 Medallion Signature Guaranteed: 

NOTICE 
 The signature to
the foregoing Assignment and Certificate must correspond to the name as written upon the face of this Rights Certificate in every particular, without alteration or enlargement or any change whatsoever. 

  
 B-6 

 [Form of Reverse Side of Rights Certificate—continued] 

FORM OF ELECTION TO PURCHASE 

(To be executed by the registered holder if such holder desires to 

exercise any or all Rights evidenced by the Rights Certificate.) 

To:        Arrowhead Pharmaceuticals, Inc.: 

The undersigned hereby irrevocably elects to exercise
                                        
(                    ) Rights evidenced by this Rights Certificate to purchase the shares of Preferred Stock issuable upon the exercise of the
Rights (or such other securities of the Company or of any other person that may be issuable upon the exercise of the Rights) and requests that certificates for such shares be issued in the name of and delivered to or that such shares be credited to
the book-entry account of: 
  
  

(Please print social security or other identifying number) 
  

 
  

 
 (Please print name and address) 

If such number of Rights shall not be all the Rights evidenced by this Rights Certificate, a new Rights Certificate for the balance of such
Rights shall be registered in the name of and delivered to: 
  
  

(Please print social security or other identifying number) 
  

 
  

 
 (Please print name and address) 

Dated:
                                ,
             
  

	
	
	   

	Signature

 Medallion Signature Guaranteed: 

  
 B-7 

 Certificate 

The undersigned hereby certifies by checking the appropriate boxes that: 

(1)        the Rights evidenced by this Rights Certificate [    ] are
[    ] are not being exercised by or on behalf of a Person who is or was an Acquiring Person or an Affiliate or Associate of any such Acquiring Person (as such terms are defined pursuant to the Rights Agreement); and 

(2)        after due inquiry and to the best knowledge of the undersigned, he, she, or it
[    ] did [    ] did not acquire the Rights evidenced by this Rights Certificate from any Person who is, was or became an Acquiring Person or an Affiliate or Associate of an Acquiring Person.

  

							
				
	Dated:                                 ,
            	 		 		 	  

		 		 		 	Signature

 Medallion Signature Guaranteed: 

NOTICE 
 The signature to
the foregoing Election to Purchase and Certificate must correspond to the name as written upon the face of this Rights Certificate in every particular, without alteration or enlargement or any change whatsoever. 

  
 B-8 

 EXHIBIT C 

UNDER CERTAIN CIRCUMSTANCES AS SET FORTH IN THE RIGHTS AGREEMENT, RIGHTS BENEFICIALLY OWNED BY ANY PERSON WHO IS, WAS, OR BECOMES AN
ACQUIRING PERSON OR ANY AFFILIATE OR ASSOCIATE THEREOF (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT), WHETHER CURRENTLY BENEFICIALLY OWNED BY OR ON BEHALF OF SUCH PERSON OR BY ANY SUBSEQUENT BENEFICIAL OWNER, MAY BECOME NULL AND VOID. 

FORM OF SUMMARY OF RIGHTS TO PURCHASE PREFERRED STOCK 

On March 1, 2017, the Board of Directors (the “Board”) of Arrowhead Pharmaceuticals, Inc., a Delaware corporation (the
“Company”), authorized and declared a dividend distribution of one right (each, a “Right” and, together with all other such rights distributed or issued pursuant to the Rights Agreement (defined below), the
“Rights”) for each share of common stock, par value $0.001, of the Company (the “Common Stock”) outstanding as of the close of business on March 22, 2017 (the “Record Date”). 

The following is a summary description of the Rights and the Rights Agreement (the “Rights Agreement”), dated as of
March 21, 2017, by and between the Company and Computershare Trust Company, N.A., as rights agent (the “Rights Agent”). This summary is intended to provide a general description only and is subject to the detailed terms and
conditions of the Rights Agreement. 
 The Company has filed a copy of the Rights Agreement with the U.S. Securities and Exchange
Commission as an exhibit to a Form 8-K filed by the Company on March 23, 2017. In addition, a copy of the Rights Agreement is available free of charge from the Company and the Rights Agent. This
summary description of the Rights does not purport to be complete and is qualified in its entirety by reference to the Rights Agreement. 
  

	1.	Issuance of Rights 

 Each holder of Common Stock as of the Record Date will receive a
dividend of one Right per share of Common Stock. One Right will also be issued together with each share of Common Stock issued by the Company after the Record Date and prior to the Distribution Date (as defined in Section 2 below), and in
certain circumstances, after the Distribution Date. New certificates for Common Stock issued after the Record Date will contain a notation incorporating the Rights Agreement by reference. 

Until the Distribution Date: 
  

	 	●	 	the Rights will not be exercisable; 

  
 C-1 

	 	●	 	the Rights will be evidenced by the certificates for Common Stock (or, in the case of book entry shares, by notation in book entry) and not by separate rights certificates; and 

 

	 	●	 	the Rights will be transferable by, and only in connection with, the transfer of Common Stock. 

  

	2.	Distribution Date; Beneficial Ownership 

 The Rights are not exercisable until the
Distribution Date. As of and after the Distribution Date, the Rights will separate from the Common Stock and each Right will become exercisable to purchase one one-thousandth of a share of Series D Junior Participating Preferred Stock, par value
$0.001 per share, of the Company (each whole share, a share of “Preferred Stock”) at a purchase price of $20 (such purchase price, as may be adjusted, the “Purchase Price”). This portion of a share of Preferred
Stock would give the holder thereof approximately the same dividend, voting, and liquidation rights as would one share of Common Stock, with any variations set forth in the Certificate of Designation, Preferences, and Rights of Series D Junior
Participating Preferred Stock, which is attached as an exhibit to a Form 8-K filed by the Company on March 23, 2017. Prior to exercise, the Right does not give its holder any dividend, voting or
liquidation rights. 
 The “Distribution Date” is the earlier of: 

 

	 	●	 	Ten (10) Business Days following a public announcement that a person has become an “Acquiring Person” by acquiring beneficial ownership of 15% or more of the Common Stock then outstanding (or, in the case
of a person that had beneficial ownership of 15% or more of the outstanding Common Stock on the date that the Rights Agreement was executed, by obtaining beneficial ownership of any additional shares of Common Stock) other than as a result of
repurchases of Common Stock by the Company or certain inadvertent acquisitions; and 

  

	 	●	 	Ten (10) business days (or such later date as the Board shall determine prior to the time a person becomes an Acquiring Person) after the commencement of a tender offer or an exchange offer by or on behalf of any
person (other than the Company and certain related entities) that, if completed, would result in such person becoming an Acquiring Person. 

A person will be deemed to “beneficially own” any Common Stock if such person or any affiliated or associated persons of such
person: 
  

	 	●	 	is considered a “beneficial owner” of the Common Stock under Rule 13d-3 of the General Rules and Regulations under the Securities Exchange Act of 1934, as amended
and as in effect on the date of the Rights Agreement; 

  

	 	●	 	 has the right to acquire the Common Stock, either immediately or in the future, pursuant to any agreement,
arrangement, or understanding (other than a 

  
 C-2 

	 	 
customary underwriting agreement relating to a bona fide public offering of the Common Stock) or upon the exercise of conversion rights, exchange rights, rights, warrants or options, or
otherwise, except that a person will not be deemed to be a beneficial owner of (a) securities tendered pursuant to a tender offer or an exchange offer by or on behalf of such person or any affiliated or associated persons of such person until
the tendered securities are accepted for purchase or exchange, (b) securities issuable upon the exercise of a Right before the occurrence of a Triggering Event (as defined in Section 5 below), or (c) securities issuable upon the
exercise of a Right after the occurrence of a Triggering Event if the Rights are originally issued Rights or were issued in connection with an adjustment to originally issued Rights; 

 

	 	●	 	has the right to vote or dispose of the Common Stock pursuant to any agreement, arrangement, or understanding (other than a right to vote arising from the granting of a revocable proxy or consent that is not also then
reportable on a Schedule 13D); or 

  

	 	●	 	has an agreement, arrangement, or understanding with another person who beneficially owns Common Stock and the agreement, arrangement, or understanding is for the purpose of acquiring, holding, voting, or disposing of
any securities of the Company (other than customary underwriting agreements relating to a bona fide public offering of Common Stock or a right to vote arising from the granting of a revocable proxy or consent that is not also then reportable on a
Schedule 13D). 

 Certain synthetic interests in securities created by derivative positions—whether or not such
interests are considered to be ownership of the underlying common stock or are reportable on a Schedule 13D—are treated as beneficial ownership of the number of shares of Common Stock equivalent to the economic exposure created by the
derivative position, to the extent actual shares of Common Stock are directly or indirectly held by counterparties to the derivatives contracts. Swaps dealers unassociated with any control intent or intent to evade the purposes of the Rights
Agreement are excepted from such imputed beneficial ownership. 
  

	3.	Issuance of Rights Certificates 

 As soon as practicable after the Distribution Date,
the Company or the Rights Agent will mail rights certificates to holders of record of Common Stock as of the close of business on the Distribution Date (other than an Acquiring Person or any Associate or Affiliate of an Acquiring Person) and,
thereafter, the separate rights certificates alone will evidence the Rights. 
  

	4.	Expiration of Rights 

 The Rights will expire on the earliest of (a) 5:00 p.m., New
York time, on March 21, 2018, (b) the time at which the Rights are redeemed (as described in Section 6 below), 

  
 C-3 

 
and (c) the time at which the Rights are exchanged in full (as described in Section 7 below) (the earliest of (a), (b) and (c) being herein referred to as, the
“Expiration Date”). 
  

	5.	Change of Exercise of Rights Following Certain Events 

 The following described events
are referred to as “Triggering Events.” 
 (a)       Flip-In Event. In the event that
a person becomes an Acquiring Person, each holder of a Right will thereafter have the right to receive, upon exercise, Common Stock (or, in certain circumstances, other securities, cash, or other assets of the Company) having a value equal to two
times the Purchase Price. Notwithstanding any of the foregoing, following the occurrence of a person becoming an Acquiring Person, all Rights that are, or (under certain circumstances specified in the Rights Agreement) were, beneficially owned by
any Acquiring Person (or by certain related parties) will be null and void. 
 For example, at a purchase price of $20 per Right, following
the occurrence of a person becoming an Acquiring Person, each Right not owned by the Acquiring Person (or by certain related parties) would entitle its holder to purchase $40 worth of Common Stock (or, in certain circumstances, other securities,
cash, or other assets of the Company) for $20. Assuming that the Common Stock has a per share value of $2 at such time, the holder of each valid Right would be entitled to purchase 20 shares of Common Stock (or, in certain circumstances, other
securities, cash, or other assets of the Company) for $20. 
 (b)       Flip-Over Events. In the event
that, at any time after a person has become an Acquiring Person, (i) the Company engages in a merger or other business combination transaction in which the Company is not the continuing or surviving corporation or other entity, (ii) the
Company engages in a merger or other business combination transaction in which the Company is the continuing or surviving corporation and the Common Stock of the Company are changed or exchanged, or (iii) 50% or more of the Company’s
assets or earning power is sold or transferred, each holder of a Right (except Rights that have previously been voided as set forth above) shall thereafter have the right to receive, upon exercise, common shares of the acquiring company having a
value equal to two times the Purchase Price. 
  

	6.	Redemption 

 At any time prior to the earlier of (a) the Distribution Date and
(b) the Expiration Date, the Board may direct the Company to redeem the Rights in whole, but not in part, at a price of $0.01 per Right (payable in cash, Common Stock, or other consideration deemed appropriate by the Board). Immediately upon
the action of the Board directing the Company to redeem the Rights, the Rights will terminate and the only right of the holders of Rights will be to receive the $0.01 redemption price. 

  
 C-4 

	7.	Exchange of Rights 

 At any time after a person becomes an Acquiring Person, but before
any person acquires beneficial ownership of 50% or more of the outstanding Common Stock, the Board may direct the Company to exchange the Rights (other than Rights owned by such person or certain related parties, which will have become null and
void), in whole or in part, at an exchange ratio of one share of Common Stock per Right (subject to adjustment). The Company may substitute shares of Preferred Stock (or shares of a class or series of the Company’s preferred stock having
equivalent rights, preferences, and privileges) for Common Stock at an initial rate of one one-thousandth of a share of Preferred Stock (or of a share of a class or series of the Company’s preferred stock having equivalent rights, preferences,
and privileges) per share of Common Stock. Immediately upon the action of the Board directing the Company to exchange the Rights, the Rights will terminate and the only right of the holders of Rights will be to receive the number of shares of Common
Stock (or one one-thousandth of a share of Preferred Stock or of a share of a class or series of the Company’s preferred stock having equivalent rights, preferences, and privileges) equal to the number of Rights held by such holder multiplied
by the exchange ratio. 
  

	8.	Adjustments to Prevent Dilution; Fractional Shares 

 The Board may adjust the Purchase
Price, the number of shares of Preferred Stock or other securities or assets issuable upon the exercise of a Right, and the number of Rights outstanding to prevent dilution that may occur (a) in the event of a stock dividend on, or a
subdivision, combination, or reclassification of, the Preferred Stock, (b) in the event of a stock dividend on, or a subdivision or combination of, the Common Stock, (c) if holders of the Preferred Stock are granted certain rights,
options, or warrants to subscribe for Preferred Stock or convertible securities at less than the current market price of the Preferred Stock, or (d) upon the distribution to holders of the Preferred Stock of evidences of indebtedness or assets
(excluding regular periodic cash dividends) or of subscription rights or warrants (other than those referred to above). 
 With certain
exceptions, no adjustment in the Purchase Price will be required until cumulative adjustments amount to at least 1% of the Purchase Price. No fractional shares of Preferred Stock will be issued (other than fractions that are integral multiples of
one one-thousandth of a share of Preferred Stock), and in lieu thereof, an adjustment in cash may be made based on the market price of the Preferred Stock on the last trading date prior to the date of exercise. 

 

	9.	No Stockholder Rights Prior to Exercise; Tax Considerations 

 Until a Right is
exercised, the holder thereof, as such, will have no rights as a stockholder of the Company, including, without limitation, the right to vote or to receive dividends. While the distribution of the Rights will not be taxable to stockholders or to the
Company, stockholders may, depending upon the circumstances, recognize taxable income in the event that the Rights become exercisable for Common Stock (or other consideration) of the Company or for common shares of the acquiring company or in the
event of the redemption of the Rights as set forth in Section 6 above. 

  
 C-5 

	10.	Amendment of Rights Agreement 

 The Company, by action of the Board, may supplement or
amend any provision of the Rights Agreement in any respect without the approval of any registered holder of Rights, including, without limitation, in order to (a) cure any ambiguity, (b) correct or supplement any provision contained in the
Rights Agreement that may be defective or inconsistent with other provisions of the Rights Agreement, (c) shorten or lengthen any time period under the Rights Agreement, or (d) otherwise change, amend, or supplement any provisions of the
Rights Agreement in any manner that the Company deems necessary or desirable; provided, however, that no supplement or amendment made after a person becomes an Acquiring Person shall adversely affect the interests of the registered
holders of rights certificates (other than an Acquiring Person or any affiliated or associated persons of an Acquiring Person or certain of their transferees) or shall cause the Rights Agreement to become amendable other than in accordance with the
amendment provision contained therein. Without limiting the foregoing, the Company, by action of the Board, may at any time before any person becomes an Acquiring Person amend or supplement the Rights Agreements to make provisions of the Rights
Agreement inapplicable to a particular transaction by which a person might otherwise become an Acquiring Person or to otherwise alter the terms and conditions of the Rights Agreement as they may apply with respect to any such transaction. 

  
 C-6

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