Document:

EX-10.5

 EXHIBIT 10.5 

THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), OR ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED, PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF OR EXERCISED UNLESS (I) A REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS
SHALL HAVE BECOME EFFECTIVE WITH REGARD THERETO, OR (II) AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS AVAILABLE IN CONNECTION WITH SUCH OFFER, SALE OR TRANSFER. 

AN INVESTMENT IN THESE SECURITIES INVOLVES A HIGH DEGREE OF RISK. HOLDERS MUST RELY ON THEIR OWN ANALYSIS OF THE INVESTMENT AND ASSESSMENT OF THE RISKS
INVOLVED. 
  

			
	 Warrant to Purchase
	  	Warrant Number
	 14,423,076 shares
	  	W-74    

 Warrant to Purchase Shares of Series D Preferred Stock 

of 
 Kempharm, Inc.

 THIS CERTIFIES that Deerfield Private Design Fund III, L.P. or any subsequent holder hereof (“Holder”) has the right to subscribe for and
acquire from Kempharm, Inc., a Delaware corporation (the “Company”) (i) prior to the Mandatory Conversion Time (as defined below), Fourteen Million Four Hundred Twenty-Three Thousand Seventy-Six (14,423,076), fully paid and
nonassessable shares of the Company’s Series D Convertible Preferred Stock, no par value (“Series D Preferred Stock”), and (ii) to the extent unexercised at the Mandatory Conversion Time (as defined below), from and after the
Mandatory Conversion Time a number of fully paid and nonassessable shares of the Company’s Common Stock, no par value (“Common Stock”), equal to the Common Stock Amount (as defined below) (such shares of Series D Preferred Stock or
Common Stock, as the case may be, issuable upon exercise of this Warrant, the “Shares”), subject to the terms set forth herein, at a price equal to the Exercise Price as defined in Section 3 below, at any time during the Term (as
defined below). 
 Holder agrees with the Company that this Warrant to Purchase Shares of the Company (this “Warrant” or this
“Agreement”) is issued and all rights hereunder shall be held subject to all of the conditions, limitations and provisions set forth herein. 
 1.
Date of Issuance and Term. 
 This Warrant shall be deemed to be issued on June 2, 2014 (“Date of Issuance”). The term of this Warrant
begins on the Date of Issuance and ends at 5:00 p.m., New York City time, on June 2, 2024 (the “Term”). This Warrant was issued in conjunction with that certain Facility Agreement (the “Facility Agreement”) by and among the
Company and Deerfield Private Design Fund III, L.P., dated June 2, 2014, entered into in conjunction herewith. 
 Notwithstanding anything herein to
the contrary, the Company shall not issue to the Holder, and the Holder may not acquire, a number of Shares upon exercise of this Warrant to the extent that, upon such exercise, the number of shares of Common Stock then beneficially owned by the
Holder and its Affiliates and any other persons or entities whose beneficial ownership of Common Stock would be aggregated with the Holder’s for purposes of Section 13(d) of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”) (including shares held by any “group” of which the Holder is a member, but excluding shares beneficially owned by virtue of the ownership of securities or rights to acquire securities that have limitations on the
right to convert, exercise or purchase similar to the limitation set forth herein) would exceed 9.985% of the total number of the shares of Common Stock then issued and 

  
 1. 

 
outstanding (the “9.985% Cap”)); provided that the 9.985% Cap shall not apply to the extent that shares of Common Stock are not deemed to constitute “equity securities”
pursuant to Rule 13d-1(i) under the Exchange Act and, provided further, that the 9.985% Cap shall not apply to an exercise effected following receipt of a Major Transaction Notice (as defined below) in respect of a Major Transaction (as defined
below) described in Section 5(c)(i)(A) below in which the Company is not the surviving entity until consummation or abandonment of such Major Transaction. 

“Affiliate” means any person or entity that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under
common control with a person or entity, as such terms are used in and construed under Rule 144 under the Securities Act of 1933, as amended (the “Securities Act”). With respect to a Holder of Warrants, any investment fund or managed
account that is managed on a discretionary basis by the same investment manager as such Holder will be deemed to be an Affiliate of such Holder. 
 For
purposes hereof: 
 “Business Day” means a day other than a day on which commercial banks are authorized or required by law to close in the City
of New York. 
 “Common Stock Amount” means a number of shares of Common Stock of the Company equal to (x) the number of shares of Series D
Preferred Stock issuable upon a full Cash Exercise of this Warrant immediately prior to the Mandatory Conversion Time, multiplied by (y) the Per Share Underlying Common Amount at such time. 

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

“Fair Market Value” means the fair market value as mutually determined by the Company and the Required Holders (as defined below), subject to the
dispute resolution provisions set forth in Section 3(b) below. 
 “Holder” means Deerfield Special Situations International Master Fund, L.P.
and any transferee or assignee pursuant to the terms of this Warrant. 
 “Initial Warrantholders” shall mean the initial Holders of this Warrant
and the initial holders of the other Warrants issued pursuant to the Facility Agreement. 
 “Investor Agreements” shall mean the Right of First
Refusal and Co-Sale Agreement, dated as of June 2, 2014, by and among the Company and the stockholders party thereto, the Investors’ Rights Agreement (the “Investor Rights Agreement”), dated as of June 2, 2014, by and among
the Company and the stockholders party thereto, and the Voting Agreement, dated as of June 2, 2014, by and among the Company and the stockholders party thereto. 

“Mandatory Conversion Time” means the time of any mandatory conversion of the shares of Series D Preferred Stock required by the Company’s
certificate of incorporation (as it may be amended or restated from time to time (the “Charter”)). 
 “Per Share Underlying Common
Amount” means the number of shares of Common Stock, at any relevant time, that would be issuable upon conversion of one share of Series D Preferred Stock, reflected as a fraction to the third decimal. 

“Required Holders” means holders of a majority in interest of the Warrants. 

2. Exercise. 
 (a) Manner of Exercise. During the
Term, this Warrant may be Exercised as to all or any lesser number of whole Shares covered hereby (the “Warrant Shares”) by sending the Exercise Form attached hereto as Exhibit A (the “Exercise Form”) duly completed and
executed, for each Share as to which this Warrant is Exercised, at the office of the Company, 2656 Crosspark Road, Suite 100, Coralville, IA 52441, or at such other office or agency as the Company may designate in writing, by overnight mail,
facsimile (319) 665-2577, or electronic mail (rjohnson@kempharm.com) (such exercise hereinafter called the “Exercise” of this Warrant). 

  
 2. 

 (b) Date of Exercise. The “Date of Exercise” of the Warrant shall be defined as the date that
the Exercise Form attached hereto as Exhibit A, completed and executed, is sent to the Company (whether transmission by the Holder is by facsimile, electronic mail or mail), provided that the Exercise Price is satisfied, within two (2) Business
Days thereafter. Upon delivery of the Exercise Form to the Company by electronic mail, facsimile or otherwise, the Holder shall be deemed for all corporate purposes to have become the holder of record of the Warrant Shares with respect to which this
Warrant has been Exercised, irrespective of the date such Warrant Shares are issued or delivered. The Holder shall not be required to physically surrender this Warrant to the Company until the Holder has purchased all of the Warrant Shares
available hereunder and the Warrant has been exercised in full, in which case the Holder shall surrender this Warrant to the Company for cancellation within three (3) Trading Days of the date the final Exercise Notice is delivered to the
Company. Execution and delivery of the Exercise Notice shall have the same effect as cancellation of the original Warrant and issuance of a New Warrant evidencing the right to purchase the remaining number of Warrant Shares, if any. 

(c) Delivery of Shares. Upon Exercise. Upon an exercise of this Warrant, within the Delivery Period (as defined below), the Company shall issue and
deliver (or cause its transfer agent (the “Transfer Agent”)) to issue and deliver, if applicable), in accordance to the terms hereof to or upon the order of the Holder, that number of Shares for the portion of this Warrant exercised as
shall be determined in accordance herewith. Upon the Exercise of this Warrant or any part hereof, the Company shall, at its own cost and expense, take all necessary action, including the instructions to and the costs associated with obtaining and
delivering an opinion of counsel, if applicable, to assure that any such Transfer Agent shall, to the extent applicable issue stock certificates in the name of Holder (or its nominee) or such other persons as designated by Holder and in such
denominations to be specified at Exercise representing the number of Shares issuable upon such Exercise. “Delivery Period” means the period beginning on the Date of Exercise and ending (i) in the case of an exercise made prior to an
IPO Event, fifteen (15) Business Days after such Date of Exercise and (ii) in the case of an exercise made after an IPO Event, three (3) Business Days after such Date of Exercise. “Exercise Shares” means the number of Shares
that are issuable by the Company in respect of an exercise hereunder. 
 (d) Delivery Failure. In addition to any other remedies which may be
available to the Holder, in the event that the Company fails for any reason to effect issuance or delivery of the Exercise Shares by the end of the Delivery Period (a “Delivery Failure”), the Holder will be entitled to revoke all or part
of the relevant Exercise Form by delivery of a notice to such effect to the Company whereupon the Company and the Holder shall each be restored to their respective positions immediately prior to the delivery of such notice, except that the
liquidated damages described herein shall be payable through the date notice of revocation or rescission is given to the Company (or until the date the applicable Exercise Shares are delivered, if earlier). 

(e) Legends. 
 (i) Restrictive Legend. The Holder
understands that, for so long as required pursuant to the Investor Agreements, the Exercise Shares shall contain the restrictive legends required pursuant to the terms of the Investor Agreements (the “IRA Legends”). The Holder further
understands that following the later of the Mandatory Conversion Time and the IPO Event, until the Exercise Shares have been registered for resale under the Securities Act or otherwise may be sold pursuant to Rule 144 under the Securities Act or an
exemption from registration under the Securities Act without any restriction as to the number of securities as of a particular date that can then be immediately sold is available, the Exercise Shares may bear a restrictive legend (the
“Securities Legend”) or the Securities Legend shall apply, as applicable, in substantially the following form (and a stop-transfer order may be placed against transfer of the certificates for such securities): 

“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE
SECURITIES LAWS. THE SECURITIES MAY NOT BE SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER SAID ACT, OR PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER SAID ACT INCLUDING, WITHOUT
LIMITATION, PURSUANT TO RULES 144 OR 144A UNDER SAID ACT 

  
 3. 

 
OR PURSUANT TO A PRIVATE SALE EFFECTED UNDER APPLICABLE FORMAL OR INFORMAL SEC INTERPRETATION OR GUIDANCE, SUCH AS A SO-CALLED “4(1) AND A HALF” SALE.” 

(ii) Removal of Restrictive Legends. The Exercise Shares shall not contain the Securities Legend and no legend (other than the IRA Legends, if required
under the Investor Agreements) shall apply, as applicable, restricting the transfer thereof: (A) while a registration statement covering the sale or resale of such security is effective under the Securities Act, or (B) following any sale
of such Exercise Shares pursuant to Rule 144, or (C) if such Exercise Shares are eligible for sale under Rule 144(b)(1) without volume restriction, or (D) if transfer restrictions are not required under applicable requirements of the
Securities Act (including judicial interpretations and pronouncements issued by the staff of the SEC) (collectively, the “Unrestricted Conditions”). Upon request to the Company by Holder to remove the Securities Legend from any Exercise
Shares or to issue Exercise Shares without the Securities Legend upon exercise of the Warrant, in either case based on an Unrestricted Condition being met, the Company shall cause its counsel to issue a legal opinion to the Transfer Agent promptly
after the satisfaction of an Unrestricted Condition if required by the Company’s transfer agent to effect the issuance of the Exercise Shares without such restrictive legend or removal of the legend hereunder, subject, in respect of a legend
removal request prior to effectiveness of a registration statement covering the resale of the Warrant Shares, receipt by such counsel of certification of the holder of the Exercise Shares that it is not at such time, and has not been during the
previous three month period, an affiliate of the Company (a “Rule 144 Certification”). If an Unrestricted Condition is met at the time of issuance of the Exercise Shares, then such Exercise Shares shall be issued free of all legends (other
than any IRA Legends required under the Investor Agreements). The Company agrees that following such time as an Unrestricted Condition is met or such legend is otherwise no longer required under this Section 2(e), it will, upon delivery of a
written request to the Company by the holder of the Exercise Shares to remove the Securities Legend based upon an Unrestricted Condition being met, no later than the date (such date, the “Legend Removal Date”) that is the later of
(A) three (3) Trading Days (or fifteen (15) Business Days if prior to an IPO Event) following the delivery by the holder to the Company or the Transfer Agent of the Exercise Shares, issued with such restrictive legend and (B) if
(and only if) a Rule 144 Certification is required by the second sentence of this paragraph, two (2) Business Days after the date of delivery of the Rule 144 Certification to counsel to the Company, deliver or cause to be delivered to such
holder the Exercise Shares free of all restrictive legends, and/or a confirmation (or electronic transfer) confirming in respect of such shares that it is free from all restrictive and other legends (other than any IRA Legends then required under
the Investor Agreements). 
 (iii) Sale of Unlegended Shares. Holder agrees that the removal of the restrictive legend from any securities as set
forth in Section 2(e) above is predicated upon the Company’s reliance that the Holder will sell such Exercise Shares pursuant to either the registration requirements of the Securities Act, including any applicable prospectus delivery
requirements, or a valid exemption therefrom, and that if such securities are sold pursuant to a Registration Statement, they will be sold in compliance with the plan of distribution set forth therein. 

(f) Cancellation of Warrant. This Warrant shall be canceled upon the full Exercise, of this Warrant, and, as soon as practical after the Date of
Exercise, Holder shall be entitled to receive Shares for the number of shares purchased upon such Exercise of this Warrant, and if this Warrant is not Exercised in full, Holder shall be entitled to receive a new Warrant (containing terms identical
to this Warrant) representing any unexercised portion of this Warrant in addition to such Shares; provided, however, as set forth in Section 2(b), Holder shall not be required to physically surrender this warrant if the Warrant is not exercised
in full. 
 (g) Holder of Record. Each person in whose name any Warrant for Shares is issued shall, for all purposes, be deemed to be the Holder of
record of such shares on the Date of Exercise of this Warrant, irrespective of the date of delivery or issuance of the Shares purchased upon the Exercise of this Warrant. 

(h) Delivery of Electronic Shares. Following the Mandatory Conversion Time, in lieu of delivering physical certificates representing the Common Stock
issuable upon Exercise or legend removal, or representing Failure Payment Shares, provided the Transfer Agent is participating in the DTC Fast Automated Securities Transfer (“FAST”) program, upon written request of the Holder, the Company
shall use its best efforts to cause its Transfer Agent to electronically transmit the Common Stock issuable upon Exercise to the Holder by crediting the account of the Holder’s prime broker with DTC through its Deposit Withdrawal Agent
Commission (DWAC) system. The time periods for delivery and penalties described herein shall apply to the electronic transmittals described herein. Any delivery not effected by electronic transmission shall be effected by delivery of physical
certificates. 

  
 4. 

 (i) Buy-In. Following the Mandatory Conversion time, in addition to any other rights available to the
Holder, if the Company fails to cause its Transfer Agent to transmit to the Holder a certificate or certificates, or electronic shares through DWAC, representing the Exercise Shares pursuant to an Exercise on or before the Delivery Period, and if
after such date the Holder is required by its broker to purchase (in an open market transaction or otherwise) or the Holder’s brokerage firm otherwise purchases shares of Common Stock to deliver in satisfaction of a sale by the Holder of the
Exercise Shares which the Holder anticipated receiving upon such Exercise (a “Buy-In”), then the Company shall (1) pay in cash to the Holder the amount by which (x) the Holder’s total purchase price (including brokerage
commissions, if any) for the shares of Common Stock so purchased exceeds (y) the amount obtained by multiplying (A) the number of Exercise Shares that the Company was required to deliver to the Holder in connection with the Exercise at
issue times and (B) the price at which the sell order giving rise to such purchase obligation was executed, and (2) at the option of the Holder, either reinstate the portion of the Warrant and equivalent number of Exercise Shares for which
such Exercise was not honored or deliver to the Holder the number of shares of Common Stock that would have been issued had the Company timely complied with its Exercise and delivery obligations hereunder. For example, if the Holder purchases Common
Stock having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted Exercise to cover the sale of Common Stock with an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (1) of the
immediately preceding sentence the Company shall be required to pay the Holder $1,000. The Holder shall provide the Company written notice indicating the amounts payable to the Holder in respect of the Buy-In, together with applicable confirmations
and other evidence reasonably requested by the Company. Nothing herein shall limit a Holder’s right to pursue any other remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performance
and/or injunctive relief with respect to the Company’s failure to timely deliver certificates representing shares of Common Stock upon Exercise of the Warrant as required pursuant to the terms hereof. 

3. Payment of Warrant Exercise Price for Cash Exercise or Cashless Exercise; Cashless Major Exercise and Cashless Default Exercise. 

(a) Exercise Price. The Exercise Price (“Exercise Price”) shall equal $0.78 per share (with respect to shares of Series D Preferred Stock)
and, from and after the Mandatory Conversion Time shall equal the Exercise Price in effect immediately prior to the Mandatory Conversion Time divided by the prevailing Per Share Underlying Common Amount, subject to adjustment pursuant to the terms
hereof, including but not limited to Section 5 below. 
 Payment of the Exercise Price may be made by either of the following, or a combination
thereof, at the election of Holder: 
 (i) Cash Exercise: The Holder may exercise this Warrant in cash, bank or cashier’s check, wire transfer
or through a reduction of an amount of principal outstanding under any Notes (as defined in the Facility Agreement) in accordance with Section 2.3(b) of the Facility Agreement, then held by the Holder (a “Cash Exercise”); or 

(ii) Cashless Exercise: The Holder, at its option, may exercise this Warrant in a cashless exercise transaction. In order to effect a Cashless
Exercise, the Holder shall send to the Company (via overnight mail, electronic mail or facsimile) at its principal office a notice of cashless election, in which event the Company shall issue Holder a number of Shares computed using the following
formula (a “Cashless Exercise”): 
 X = Y (A-B)/A 
  

					
	where:	  	X=	  	the number of Shares to be issued to Holder.

 Y = the number of Shares for which this Warrant is being Exercised. 

A = (i) prior to an IPO Event, the Fair Market Value of each Share and (ii) after an IPO Event the product of (x) the applicable
Per Share Underlying Common Amount immediately following such Exercise multiplied by (y) the Market Price of one (1) share of Common Stock (for purposes of this Section 3(a)(ii), 

  
 5. 

 
where “Market Price,” as of any date, means the Volume Weighted Average Price (as defined herein) of a share of the Company’s Common Stock during the ten (10) consecutive Trading
Day period immediately preceding the date in question); provided, that if the Mandatory Conversion Time shall have occurred, such amount shall equal the Market Price of one (1) share of Common Stock. 

B = the Exercise Price. 
 As used
herein, the “Volume Weighted Average Price” for any security as of any date means the volume weighted average sale price of such security on the principal securities exchange or trading market where such security is listed or traded as
reported by Bloomberg Financial Markets or an equivalent, reliable reporting service mutually acceptable to and hereafter designated by holders of a majority in interest of the Warrants and the Company (“Bloomberg”), or, if no volume
weighted average sale price is reported for such security, then the last closing trade price of such security as reported by Bloomberg, or, if no last closing trade price is reported for such security by Bloomberg, the average of the bid prices of
any market makers for such security that are listed in the over the counter market by the Financial Industry Regulatory Authority, Inc. or on the OTC Pink Market operated by the OTC Markets Group, Inc. If the Volume Weighted Average Price cannot be
calculated for such security on such date in the manner provided above (including because the Company’s Shares are not then listed on any principal securities exchange or trading market or any over the counter market), the Volume Weighted
Average Price shall be the Fair Market Value for which the calculation of the Volume Weighted Average Price is required in order to determine the Exercise Price of such Warrants. “Trading Day” shall mean any day on which the Shares are
traded for any period on the principal securities exchange or other securities market on which the Shares are then being traded or, prior to such time as the Shares are so traded, shall mean any Business Day. 

For purposes of Rule 144 and sub-section (d)(3)(x) thereof, it is intended, understood and acknowledged that the Shares issuable upon Exercise of this Warrant
in a Cashless Exercise transaction and the shares of Common Stock issuable upon conversion of such Shares shall be deemed to have been acquired at the time this Warrant was originally issued. Moreover, it is intended, understood and acknowledged
that the holding period for the Shares issuable upon Exercise of this Warrant in a Cashless Exercise transaction and the shares of Common Stock issuable upon conversion of such Shares shall be deemed to have commenced on the date this Warrant was
issued. As provided in Section 2(b), the Holder shall only be required to physically surrender this Warrant in the event that the Holder is exercising this Warrant in full. 

(b) Dispute Resolution. In the case of a dispute as to the determination of the closing price, the Volume Weighted Average Price or the Fair Market
Value or the arithmetic calculation of the Exercise Price, Market Price or any Major Transaction Warrant Early Termination Price, the Company shall submit the disputed determinations or arithmetic calculations via facsimile within two
(2) Business Days of receipt, or deemed receipt, of the Exercise Notice, or other event giving rise to such dispute, as the case may be, to the Holder. If the Required Holders and the Company are unable to agree upon such determination or
calculation within two (2) Business Days of such disputed determination or arithmetic calculation being submitted to the Holder, then the Company shall, within two (2) Business Days submit via facsimile (i) the disputed determination
of the closing price, the Volume Weighted Average Price or the Fair Market Value or Major Transaction Early Warrant Early Termination Price to a nationally recognized, independent, reputable investment bank selected by the Company and approved by
the Required Holders, which investment bank shall not have provided services to either the Company, the Holder or any of their respective Affiliates during the five-year period preceding the date of its selection, or (ii) the disputed
arithmetic calculation of the Exercise Price, Market Price or any Major Transaction Warrant Early Termination Price to the Company’s independent, outside accountant. The Company shall exercise commercially reasonable efforts to cause the
investment bank or the accountant, as the case may be, to perform the determinations or calculations and notify the Company and the Required Holders of the results no later than five (5) Business Days from the time it receives the disputed
determinations or calculations. Such investment bank’s or accountant’s determination or calculation, as the case may be, shall be binding upon all parties absent demonstrable error and the Company shall pay the fees and costs of such
investment banker or accountant. 

  
 6. 

 4. Transfer. Subject to the provisions of Section 8 of this Warrant, this Warrant may be transferred
on the books of the Company, in whole or in part, in person or by attorney, upon surrender of this Warrant properly completed and endorsed. This Warrant shall be canceled upon such surrender and, as soon as practicable thereafter, the person to whom
such transfer is made shall be entitled to receive a new Warrant or Warrants as to the portion of this Warrant transferred, and Holder shall be entitled to receive a new Warrant as to the portion hereof retained. 

5. Adjustments Upon Certain Events. 
 (a)
Participation. The Holder, as the holder of this Warrant, shall be entitled to receive from the Company such amount equal to the amount of dividends paid and distributions of any kind made to the holders of Series D Preferred Stock or Common
Stock to the same extent as if the Holder had Exercised this Warrant into Shares (or, as applicable, had converted such Shares of Series D Preferred Stock into shares of Common Stock) and had held such Shares or conversion shares, as applicable, on
the record date for such dividends and distributions. Payments under the preceding sentence shall be made concurrently with the dividend or distribution to the holders of Shares or Common Stock, as the case may be. 

(b) Recapitalization or Reclassification. If the Company shall at any time effect a stock split, payment of stock dividend, recapitalization,
reclassification or other similar transaction of such character that the Shares (whether shares of Series D Preferred Stock or Common Stock) shall be changed into or become exchangeable for a larger or smaller number of shares, then upon the
effective date thereof, the number of Shares which Holder shall be entitled to purchase upon Exercise of this Warrant shall be increased or decreased, as the case may be, in direct proportion to the increase or decrease in the number of Shares by
reason of such stock split, payment of stock dividend, recapitalization, reclassification or similar transaction, and the Exercise Price shall be, in the case of an increase in the number of shares, proportionally decreased and, in the case of
decrease in the number of shares, proportionally increased. The Company shall give Holder the same notice it provides to holders of Shares of any transaction described in this Section 5(b). 

(c) Rights Upon Major Transaction. 
 (i) Major
Transaction. In the event that a Major Transaction (as defined below) occurs, then the Holder, at its option, may require the Company to redeem all or any portion of the Holder’s outstanding Warrants in accordance with
Section 5(c)(iii) below. In the event the Holder shall not have exercised any of its rights under the immediately preceding sentence within the applicable time periods set forth herein, then the Major Transaction shall be treated as an
Assumption (as defined below) in accordance with Section 5(c)(ii) below. Notwithstanding anything herein to the contrary, the Holder may waive the above provisions of this Section 5(c) with respect to any Major Transaction and, without
limitation, may elect to Exercise this Warrant prior to any Major Transaction. 
 Each of the following events shall constitute a “Major
Transaction”: 
 (A) a consolidation, merger, exchange of shares, recapitalization, reorganization, business combination or other similar event,
(1) following which the holders of shares of voting stock of the Company immediately preceding such consolidation, merger, exchange, recapitalization, reorganization, combination or event either (a) no longer hold a majority of the shares
of voting stock or (b) no longer have the ability to elect a majority of the board of directors of the Company, or (2) as a result of which Shares or shares of voting stock shall be changed into (or the holders of Shares or shares of
Common Stock become entitled to receive) the same or a different number of shares of the same or another class or classes of stock or securities of another entity (collectively, a “Change of Control Transaction”); 

(B) the sale or transfer in one transaction or a series of related transactions of (i) all or substantially all of the assets of the Company to any
Person or (ii) assets of the Company for a purchase price equal to more than 50% of the Applicable Value (as defined below); 
 (C) a third party
purchase, tender or exchange offer made to the holders of outstanding Shares or shares of any class(es) or series capital stock, such that following such purchase, tender or exchange offer a Change of Control Transaction shall have occurred; 

  
 7. 

 (D) the liquidation, bankruptcy, insolvency, dissolution or winding-up (or the occurrence of any analogous
proceeding) affecting the Company; 
 (E) after an IPO Event the shares of Common Stock cease to be listed on any Eligible Market on which they are then
listed or quoted and are not promptly re-listed or requoted on an Eligible Market; 
 (F) at any time after an IPO Event, the shares of Common Stock cease
to be registered under Section 12 of the Exchange Act; or 
 (G) any “Event of Liquidation” occurs under the terms of the Charter; 

provided, however, that, a Major Transaction or Change of Control shall not be deemed to have occurred solely as a result of the transfer of ownership of any
shares of capital stock of the Company without the consent or agreement of the Company; provided that such proviso shall not apply to an event specified in subsection (G) of the definition of Major Transaction. 

(ii) Assumption. The Company shall not enter into or be party to a Major Transaction that is to be treated as an Assumption pursuant to
Section 5(c)(i), unless the Successor Entity assumes in writing all of the obligations of the Company under this Warrant, the Facility Agreement (and any notes issued thereunder) and provides registration rights comparable to those provided to
the initial Holder under the Investor Rights Agreement, in accordance with the provisions of this Section (ii) (an “Assumption”) pursuant to written agreements and instruments (“Assumption Agreements”) necessary to effect
such Assumption in form and substance reasonably satisfactory to the Required Holders and approved by the Required Holders prior to such Major Transaction (such consents and approvals not to be unreasonably withheld or delayed), including the
delivery to each holder of Warrants in exchange for such Warrants a security of the Successor Entity evidenced by a written instrument substantially similar in form and substance to the Warrants (the “Successor Warrant”), including,
without limitation, representing the appropriate number of shares of the Successor Entity having the exercise rights contained herein (including but not limited to the prevailing aggregate Exercise Price at such time and underlying number and type
of securities, based on the price per share or conversion ratio to be received by the holders of Shares in the Major Transaction) and containing the other rights set forth herein, in each case, reasonably satisfactory to the Required Holders;
provided, however, that the Facility Agreement and any notes issued thereunder shall not be required as Assumption Agreements in the event the Company has prepaid all outstanding indebtedness (and all accrued interest) owed under the Facility
Agreement. The provisions of this Section shall apply similarly and equally to successive Major Transactions and shall be applied without regard to any limitations on the exercise of this Warrant including any applicable ownership limitations. The
Company shall not effect a Major Transaction that is being treated as an Assumption unless the Successor Warrant and other Assumption Agreements are issued and delivered to the Holder in accordance with the provisions hereof concurrently with the
consummation of such Major Transaction and such issuance and delivery shall be an express written condition precedent to consummation of such Major Transaction. 

(iii) Notice; Major Transaction Early Termination Right. At least twenty (20) days prior to the consummation or occurrence of any Major
Transaction, but, in any event, within five (5) Business Days following the first to occur of (x) the date of the public announcement of such Major Transaction if such announcement is made before 4:00 p.m., New York City time, (y) the
day following the public announcement of such Major Transaction if such announcement is made on and after 4:00 p.m., New York City time, or (z) the date of execution of the definitive agreement with respect to a Major Transaction, if such
agreement is executed prior to an IPO Event, the Company shall deliver written notice thereof via facsimile and overnight courier to the Holder (a “Major Transaction Notice”). At any time during the period beginning after the Holder’s
receipt of a Major Transaction Notice and ending five (5) Trading Days prior to the consummation of a Major Transaction (or portion thereof) described in Section 5(c)(i) (the “Early Termination Period”), the Holder may require
the Company to redeem (an “Early Termination Upon Major Transaction”) all or any portion of this Warrant (without regard to any ownership limitations hereunder) by delivering written notice thereof (a “Major Transaction Early
Termination Notice”) to the Company, which Major Transaction Early Termination Notice shall indicate the portion of the principal amount (the “Early Termination Principal Amount”) of the Warrant (by reference to the number of shares
issuable upon a Cash Exercise of the Principal Amount) that the Holder is electing to have redeemed. The portion of this Warrant subject to redemption pursuant to this Section 5(c)(iii) (the “Redeemable Shares”), shall be redeemed by
the Company at a price (the “Major Transaction Warrant Early Termination Price”) payable in cash equal to the “Black-Scholes Value” of the Early Termination Principal Amount determined by use of the Black-Scholes Option Pricing
Model using the criteria set forth in Schedule 1 hereto (the “Black-Scholes Value”). 

  
 8. 

 (iv) Escrow; Payment of Major Transaction Warrant Early Termination Price. The Company shall not effect a Major
Transaction that is being treated as an early termination unless it (1) either (a) shall first place into an escrow account with an independent escrow agent, at least three (3) Business Days prior to the closing date of the Major
Transaction (the “Major Transaction Escrow Deadline”), an amount of cash equal to the Major Transaction Warrant Early Termination Price or (b) obtains the written agreement of the Successor Entity that the payment of the Major
Transaction Warrant Early Termination Price shall be made to the Holder concurrently with the consummation of such Major Transaction and such issuance or payment shall be a condition precedent to consummation of such Major Transaction; (2) in
the case of a Major Transaction (or applicable portion) that is being treated as an Assumption, shall first cause the Successor Entity to issue and deliver the Successor Warrant and any applicable Assumption Agreements to the Holder in accordance
with subsection (ii) above, and (3) in the event of a Major Transaction prior to an IPO Event with a Private Successor Entity that is not a Cash-Out Major Transaction and that is being treated as a redemption hereunder, causes the
Successor Entity to provide the Holder with appropriate and reasonable access to information (subject to execution by the Holder of a non-disclosure agreement in customary and reasonable form) to determine the fair market value of its shares as per
Schedule 1 hereto and to submit any dispute with the Holder as to such determination to a dispute resolution similar to that provided in Section 3(b) hereof. The Company shall, concurrently upon closing of such Major Transaction, pay or
instruct the escrow agent to pay the Major Transaction Warrant Early Termination Price to the Holder. 
 (v) Injunction. In the event that the Company
attempts to consummate a Major Transaction without (1) either (a) placing the Major Transaction Warrant Early Termination Price in escrow in accordance with subsection (iii) above, as applicable, (b) paying the Major Transaction
Warrant Early Termination Price to the Holder prior to consummation of such Major Transaction, or (c) obtaining the written agreement of the Successor Entity described in subsection (iii) above; (2) in the case of a Major Transaction
(or applicable portion) that is being treated as an Assumption, causing the Successor Entity to issue and deliver the Successor Warrant and any applicable Assumption Agreements to the Holder and (3) in the case of a Major Transaction with a
Private Successor Entity that is not a Cash-Out Major Transaction and that is being treated as a redemption, causing the Successor Entity to take the actions described in subsection (iii) above, the Holder shall have the right to apply for an
injunction in any state or federal courts sitting in the City of New York, borough of Manhattan to prevent the closing of such Major Transaction until such applicable required action is completed, in full. 

An early termination required by this Section 5(c) shall have priority to payments to holders of capital stock in connection with a Major Transaction and
to the extent an early termination required by this Section 5(c)(iii) are deemed or determined by a court of competent jurisdiction to be prepayments of the Warrant by the Company, such early termination shall be deemed to be voluntary
prepayments. Notwithstanding anything to the contrary in this Section 5, until the Major Transaction Early Termination Price is paid in full, this Warrant may be exercised, in whole or in part, by the Holder into Shares, or in the event the
Exercise Date is after the consummation of the Major Transaction, shares of publicly traded common stock (or their equivalent) of the Successor Entity pursuant to Section 5(c). The parties hereto agree that in the event of the Company’s
early termination of any portion of the Warrant under this Section 5(c), the Holder’s damages would be uncertain and difficult to estimate because of the parties’ inability to predict future interest rates and the uncertainty of the
availability of a suitable substitute investment opportunity for the Holder. Accordingly, any premium due under this Section 5(c) is intended by the parties to be, and shall be deemed, a reasonable estimate of the Holder’s actual loss of
its investment opportunity and not as a penalty. 
 For purposes hereof: 

“Applicable Value” means (i) at any time that the Company is subject to the reporting requirements under the Exchange Act, (A) the product
of (x) the number of issued and outstanding shares of Common Stock on the date the Company delivers the Major Transaction Notice multiplied by (y) the per share closing price of the Common Stock on such date plus (B) the amount of the
Company’s debt as shown on the latest financial statements filed with the SEC (the “Current Financial Statements”) plus (C) the aggregate liquidation preference of each class of the Company’s preferred stock less
(D) the amount of cash and cash equivalents of the Company as shown on the Current Financial Statements; and (ii) at any time that the Company is not subject to the reporting requirements under the Exchange Act, the book value of the
Company’s assets as shown on the most recent financial statements of the Company. 

  
 9. 

 “Cash-Out Major Transaction” means a Major Transaction in which the consideration payable to holders of
capital stock in connection with the Major Transaction (whether paid directly or in liquidation of the Company or as a distribution following such Major Transaction) consists solely of cash. 

“Eligible Market” means the New York Stock Exchange, Inc., the NYSE Arca, the NASDAQ Capital Market, the NASDAQ Global Market, the NASDAQ Global
Select Market or the NYSE Alternext U.S. 
 “IPO Event” means the date on which shares of the Company become registered under the Securities Act
of 1933, as amended. 
 “Mixed Major Transaction” means a Major Transaction in which the consideration payable to the shareholders of the Company
consists partially of cash and partially of securities of a Successor Entity. 
 “Parent Entity” of a Person means an entity that, directly or
indirectly, controls the applicable Person and whose common stock or equivalent equity security is quoted or listed on an Eligible Market, or, if there is more than one such Person or Parent Entity, the Person or Parent Entity with the largest
public market capitalization as of the date of consummation of a Major Transaction. 
 “Person” means an individual, a limited liability company,
a partnership, a joint venture, a corporation, a trust, an unincorporated organization, any other entity and a government or any department or agency thereof. 

“Private Successor Entity” means a Successor Entity that is not a Publicly Traded Successor Entity. 

“Publicly Traded Successor Entity” means a Successor Entity that is a publicly traded corporation whose common stock is quoted on or listed for
trading on an Eligible Market (as defined above). 
 “Qualified IPO” means the closing of the sale of shares of the Common Stock to the public at
a price of at least $1.25 per share (subject to appropriate adjustment in the event of any stock dividend, stock split, combination or other similar recapitalization with respect to the Common Stock), in a firm-commitment underwritten public
offering pursuant to an effective registration statement under the Securities Act, with at least $25,000,000 of gross proceeds to the Company and a listing of the Common Stock on the Nasdaq Stock Market or the New York Stock Exchange. 

“Successor Entity” means any Person purchasing the Company’s assets or capital stock, or any successor entity resulting from such Major
Transaction, or if the Warrant is to be exercisable for shares of capital stock of its Parent Entity (as defined above), its Parent Entity. 
 (d)
Exercise Price Adjusted. As used in this Warrant, the term “Exercise Price” shall mean the purchase price per share specified in Section 3(a) of this Warrant, until the occurrence of an event stated in this Section 5 or
otherwise set forth in this Warrant, and thereafter shall mean said price as appropriately adjusted from time to time in accordance with the provisions of said subsection. No adjustment made pursuant to any provision of this Section 5 shall
have the net effect of increasing the aggregate Exercise Price in relation to the split adjusted and distribution adjusted price of the Shares. 
 (e)
Adjustments: Additional Shares, Securities or Assets. In the event that at any time, as a result of an adjustment made pursuant to this Section 5 or otherwise, Holder shall, upon Exercise of this Warrant, become entitled to receive shares
and/or other securities or assets (other than Shares) then, wherever appropriate, all references herein to Shares shall be deemed to refer to and include such shares and/or other securities or assets; and thereafter the number of such shares and/or
other securities or assets shall be subject to adjustment from time to time in a manner and upon terms as nearly equivalent as practicable to the provisions of this Section 5. 

(f) Adjustment of Exercise Price upon Issuance of Common Stock, Options, Convertible Securities, Etc. 

  
 10. 

 (i) If at any time after the Mandatory Conversion Time for so long as this Warrant is outstanding, the Company
(x) issues or sells any Common Stock, Convertible Securities, warrants, or Options or (y) directly or indirectly effectively reduces the conversion, exercise or exchange price for any Convertible Securities or Options which are currently
outstanding, at or to an effective Per Share Selling Price (as defined below) which is less than the greater of (I) the closing sale price per share of the Common Stock on the principal securities exchange, trading market or quotation system on
which shares of Common Stock are then traded, listed or quoted on the Trading Day immediately preceding such issue or sale (“Fair Market Price”), or (II) the Exercise Price, then in each such case the Exercise Price in effect immediately
prior to such issue or sale date, as applicable, shall be automatically reduced effective concurrently with such issue or sale to an amount determined by multiplying the Exercise Price then in effect by a fraction, (x) the numerator of which
shall be the sum of (1) the number of shares of Common Stock outstanding immediately prior to such issue or sale, plus (2) the number of shares of Common Stock which the aggregate consideration received by the Company for such additional
shares would purchase at such Fair Market Price or Exercise Price, as the case may be, and (y) the denominator of which shall be the number of shares of Common Stock of the Company outstanding immediately after such issue or sale. The foregoing
provision shall not apply to any issuances or sales of Common Stock or Convertible Securities (i) pursuant to any Convertible Securities or Options currently outstanding on the date hereof in accordance with the terms of such Convertible
Securities in effect on the date hereof provided that such securities have not been amended since the date hereof to directly or indirectly effectively reduce the conversion, exercise or exchange price for any Convertible Securities or Options which
are currently outstanding, or (ii) any Common Stock issued or issuable upon exercise of any options to employees, officers, directors, consultants and advisors (and any individuals who have accepted an offer of employment), in each case in
connection with any Approved Stock Plan (as defined below). 
 For the purposes of the foregoing adjustments, in the case of the issuance of any Convertible
Securities or Options, the maximum number of shares of Common Stock issuable upon exercise, exchange or conversion of such Convertible Securities or Options shall be deemed to be outstanding, provided that no further adjustment shall be made upon
the actual issuance of Common Stock upon exercise, exchange or conversion of such Convertible Securities or Options, and provided further that to the extent such Convertible Securities or Options expire or terminate unconverted or unexercised, then
at such time the Exercise Price shall be readjusted as if such portion of such Convertible Securities or Options had not been issued. 
 For purposes of
this Section 5(f), if an event occurs that triggers more than one of the above adjustment provisions, then only one adjustment shall be made and the calculation method which yields the greatest downward adjustment in the Exercise Price shall be
used. 
 (ii) Record Date. If the Company takes a record of the holders of Shares for the purpose of entitling them (1) to receive a dividend or
other distribution payable in shares of Common Stock, Options or in Convertible Securities or (2) to subscribe for or purchase shares of Common Stock, Options or Convertible Securities, then such record date will be deemed to be the date of the
issue or sale of the Shares deemed to have been issued or sold upon the declaration of such dividend or the making of such other distribution or the date of the granting of such right of subscription or purchase, as the case may be. 

(iii) Certain Definitions. For purposes of this Section 5(f), the following terms have the respective meanings set forth below: 

“Approved Stock Plan” means any employee benefit plan which has been duly adopted by a majority of the non-employee members of the Board of
Directors of the Company or a majority of the members of a committee of non-employee directors established for such purpose, pursuant to which the Company’s securities may be issued to any employee, consultant, advisor, officer or director (or
any individual who has accepted an offer of employment) for services provided to the Company, and in all cases, providing for an Exercise Price that is at or above the fair market value (as defined in such Approved Stock Plan). 

“Convertible Securities” means any stock or securities (other than Options) directly or indirectly convertible into or exchangeable or exercisable
for shares of Common Stock. 
 “Options” means any rights, warrants or options to subscribe for or purchase shares of Common Stock or Convertible
Securities. 

  
 11. 

 “Per Share Selling Price” shall include the amount actually paid by third parties for each share of
Common Stock in a sale or issuance by the Company. In the event a fee is paid by the Company in connection with such transaction directly or indirectly to such third party or its affiliates, any such fee shall be deducted from the selling price pro
rata to all shares sold in the transaction to arrive at the Per Share Selling Price. A sale of shares of Common Stock shall include the sale or issuance of Convertible Securities or Options, and in such circumstances the Per Share Selling Price of
the Common Stock covered thereby shall also include the exercise, exchange or conversion price thereof (in addition to the consideration received by the Company upon such sale or issuance less the fee amount as provided above). In case of any such
security issued in a transaction in which the purchase price or the conversion, exchange or exercise price is directly or indirectly subject to adjustment or reset based on a future date, future trading prices of the Common Stock, specified or
contingent events directly or indirectly related to the business of the Company or the market for the Common Stock, or otherwise (but excluding standard stock split anti-dilution provisions or weighted-average anti-dilution provisions similar to
that set forth herein, provided that any actual reduction of such price under any such security pursuant to such weighted-average anti-dilution provision shall be included and cause an adjustment hereunder), the Per Share Selling Price shall be
deemed to be the lowest conversion, exchange, exercise or reset price at which such securities are converted, exchanged, exercised or reset or might have been converted, exchanged, exercised or reset, or the lowest adjustment, as the case may be,
over the life of such securities. If shares are issued for a consideration other than cash, the Per Share Selling Price shall be the fair value of such consideration as determined in good faith by independent certified public accountants mutually
acceptable to the Company and the Holder. In the event the Company directly or indirectly effectively reduces the conversion, exercise or exchange price for any Convertible Securities or Options which are currently outstanding, then the Per Share
Selling Price shall equal such effectively reduced conversion, exercise or exchange price. 
 (g) Notice of Adjustments. Whenever the Exercise Price
is adjusted pursuant to the terms of this Warrant, the Company shall promptly mail to the Holder a notice (an “Exercise Price Adjustment Notice”) setting forth the Exercise Price after such adjustment and setting forth a statement of the
facts requiring such adjustment. The Company shall, upon the written request at any time of the Holder, furnish to such Holder a like Warrant setting forth (i) such adjustment or readjustment, (ii) the Exercise Price at the time in effect
and (iii) the number of Shares and the amount, if any, of other securities or property which at the time would be received upon Exercise of the Warrant. For purposes of clarification, whether or not the Company provides an Exercise Price
Adjustment Notice pursuant to this Section 5(f), upon the occurrence of any event that leads to an adjustment of the Exercise Price, the Holder would be entitled to receive a number of Exercise Shares based upon the new Exercise Price, as
adjusted, for exercises occurring on or after the date of such adjustment, regardless of whether the Holder accurately refers to the adjusted Exercise Price in the Exercise Form. 

(h) Failure of Qualified Public Offering to Occur. In the event that no Qualified Public Offering has occurred prior to the date that is thirty
(30) days prior to the expiration of the Term, the Holder shall have the right, by prior written notice delivered via electronic mail, facsimile, regular mail or overnight delivery to the Company at least five (5) days prior to the
expiration of the Term (the “Term Redemption Notice”) to require the Company to redeem this Warrant, on or prior to the date of the expiration of the Term, for an amount in cash equal to the excess, if any, of (x) the Underlying Share
Fair Market Value, over the (y) the aggregate Exercise Price of all Shares underlying this Warrant at such time. For purposes hereof, “Underlying Share Fair Market Value” means the Fair Market Value of the remaining Shares issuable
upon a Cash Exercise of this Warrant as of the date of the Term Redemption Notice. Within five (5) Business Days of receipt of a Term Redemption Notice, the Company shall submit its calculation of “Underlying Share Fair Market Value”
and supporting documentation, to the Holder. Any dispute shall be handled in accordance with the dispute resolution mechanism set forth in Section 3(b). Notwithstanding anything herein to the contrary, the provisions of this Section 5(g)
shall survive the expiration of the Term of this Warrant. 
 (i) Adjustments for Diluting Issuances. The number of shares of Common Stock (or the
number and type of other securities, as applicable) issuable upon conversion of the shares of Series D Preferred Stock for which this Warrant is exercisable, are subject to adjustment, from time to time, in the manner set forth in the Charter as if
the shares of Series D Preferred Stock for which this Warrant is exercisable were issued and outstanding on and as of the date of any such required adjustment. The provisions set forth in the Charter relating to adjustments to the Common Stock (or
the number and type of other securities) into which shares of Series D Preferred Stock are convertible in effect as of the date hereof may not be amended, modified or waived, without the prior written consent of the Required Holders unless such
amendment, modification or waiver affects the rights associated with all shares of Series D Preferred Stock in the same manner. Nothing in this subsection (h) shall in any way derogate from any other rights of the Holder set forth herein. 

  
 12. 

 6. Fractional Interests. 

No fractional shares or scrip representing fractional shares shall be issuable upon the Exercise of this Warrant, but on Exercise of this Warrant, Holder may
purchase only a whole number of Shares. If, on Exercise of this Warrant, Holder would be entitled to a fractional Share or a right to acquire a fractional Share, such fractional share shall be disregarded and the number of Shares issuable upon
Exercise shall be the next higher whole number of shares. 
 7. Authorized Share Capital. 

From and after the date hereof, the Company shall procure (including by obtaining all corporate authorizations for issuance of warrants and the underlying
securities, the exclusion of pre-emptive rights as well as waivers of any transfer restrictions) that, at all times, its authorized share capital shall be sufficient for the Exercise of this Warrant and payment of the Exercise Price and for the
conversion of all Shares issuable hereunder and payment of the exercise price applicable to such Shares. If at any time the amount of the authorized share capital of the Company is below the number of shares sufficient for the Exercise of this
Warrant or the conversion of the Shares issuable hereunder (a “Share Authorization Failure”) (based on the Exercise Price or conversion price, as the case may be, in effect from time to time), the Company will promptly take all corporate
action necessary to increase the authorized share capital of the Company, including, without limitation, calling a special meeting of shareholders and/or any other relevant corporate body to amend the Charter increasing the authorized share capital
of the sufficiently high to meet the Company’s obligations under this Section 7. The Company covenants and agrees that upon the Exercise of this Warrant, all Shares issuable upon such Exercise shall be duly and validly issued, fully paid
and nonassessable and not subject to preemptive rights, rights of first refusal or similar rights of any Person. 
 8. Restrictions on Transfer. 

(a) Registration or Exemption Required. This Warrant has been issued in a transaction exempt from the registration requirements of the Securities Act
by virtue of Regulation D and exempt from state registration or qualification under applicable state laws. None of the Warrant or the Exercise Shares may be pledged, transferred, sold or assigned except pursuant to an effective registration
statement or an exemption from the registration requirements of the Securities Act and applicable state laws including, without limitation, a so-called “4(a)(1) and a half” transaction. 

(b) Assignment. Subject to Section 8(a), the Holder may sell, transfer, assign, pledge, or otherwise dispose of this Warrant (a
“Transfer”), in whole or in part. Holder shall deliver a written notice to Company, substantially in the form of the Assignment attached hereto as Exhibit B, indicating the Person or Persons to whom the Warrant shall be assigned and
the respective number of warrants to be Transferred to each transferee. The Company shall effect the Transfer within three (3) Business Days of the satisfaction by a transferring Holder of all requirements of this Warrant for Transfer (the
“Transfer Delivery Period”), and shall deliver to the assignee(s) designated by Holder a Warrant or Warrants of like tenor and terms for the appropriate number of shares. This Warrant and the rights evidenced hereby shall inure to the
benefit of and be binding upon the successors and assigns of the Holder. The provisions of this Warrant are intended to be for the benefit of all Holders from time to time of this Warrant, and shall be enforceable by any such Holder. For avoidance
of doubt, following an IPO Event, in the event Holder notifies the Company that such sale or transfer is a so called “4(a)(1) and half” transaction, the parties hereto agree that a legal opinion from outside counsel for the Holder
delivered to counsel for the Company substantially in the form attached hereto as Exhibit C that may be relied upon by the Company shall be the only requirement to satisfy an exemption from registration under the Securities Act to effectuate such
“4(a)(1) and half” transaction. Notwithstanding the foregoing, any Transfer of this Warrant, in whole or in part while the terms of any such Investor Agreement are applicable to the Holder in its capacity as holder of this Warrant, shall
be subject to as a condition of such Transfer the transferee entering into and becoming party, to the same extent as the transferring Holder in its capacity as holder of this Warrant, to (i) the Investor Rights Agreement, (ii) the ROFR
Agreement, and (iii) the Voting Agreement, as applicable. 

  
 13. 

 9. Noncircumvention. 

The Company hereby covenants and agrees that the Company will not, by amendment of its Charter, bylaws, shareholders agreement or through any reorganization,
transfer of assets, consolidation, merger, demerger, scheme of arrangement, dissolution, issue or sale of securities, or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, and will
at all times exercise best efforts and good faith to carry out all the provisions of this Warrant and take all action as may be reasonably required to protect the rights of the Holder. Without limiting the generality of the foregoing, the Company
(i) shall not increase the par value or the rights or terms of any Shares or of the Common Stock without the prior consent of the Holder, and (ii) shall take all such actions as may be necessary or appropriate in order that the Company may
validly and legally issue fully paid and nonassessable Shares upon the exercise of this Warrant. 
 10. Events of Failure; Definition of
Black-Scholes Value. 
 (a) Definition. 

The occurrence of each of the following shall be considered to be an “Event of Failure.” 

(i) a Delivery Failure occurs, where a “Delivery Failure” shall be deemed to have occurred if the Company fails to issue and deliver Exercise Shares
to the Holder within any applicable Delivery Period; 
 (ii) a Legend Removal Failure occurs, where a “Legend Removal Failure” shall be deemed to
have occurred if the Company fails to issue Exercise Shares without a restrictive legend pursuant to the requirements of Section 2, or fails to remove a restrictive legend pursuant to the requirements of Section 2 or fails to remove any
IRA Legend at a time when such legend is not required pursuant to the Investor Agreements; 
 (iii) a Transfer Delivery Failure occurs, where a
“Transfer Delivery Failure” shall be deemed to have occurred if the Company fails to deliver a Warrant pursuant to Sections 4 and 8 within any applicable Transfer Delivery Period; or 

(iv) a “Registration Failure” occurs. 
 For purposes
hereof, a “Registration Failure” shall have occurred if the Company shall have failed to comply with its obligations to the Holder under Section 2 of the Investor Rights Agreement. 

(b) Failure Payments; Black-Scholes Determination. The Company understands that any Event of Failure (as defined above) could result in economic loss
to the Holder. In the event that any Event of Failure occurs, as compensation to the Holder for such loss, the Company agrees (as liquidated damages and not as a penalty) to pay on a daily basis to the Holder an amount payable in cash (“Failure
Payments”) equal to the amount resulting from the quotient of (A) the amount resulting from the product of (i) eighteen percent (18%) per annum (or the maximum rate permitted by applicable law, whichever is less), multiplied by
(ii) the Black-Scholes value (as determined below) of the remaining unexercised portion of this Warrant (without regard to any ownership limitations hereunder) on the date of such Event of Failure (as recalculated on the first Business Day of
each month thereafter for as long as Failure Payments shall continue to accrue), where the result of such product is divided by (B) 365, and such amount shall accrue daily from the date of such Event of Failure until the Event of Failure is
cured. For purposes of clarification, it is agreed and understood that Failure Payments shall continue to accrue following any Event of Default until the applicable Default Amount is paid in full. 

The Company shall satisfy any Failure Payments under this Section pursuant to Section 10(c) below. Failure Payments are in addition to any Warrant Shares
that the Holder is entitled to receive upon Exercise of this Warrant. 
 For purposes hereof, the “Black-Scholes” value of a Warrant shall be
determined by use of the Black-Scholes Option Pricing Model using the criteria set forth on Schedule 1 hereto. 
 (c) Payment of Accrued Failure
Payments. The Failure Payment for each Event of Failure shall be paid on or before the fifth (5th) Business Day of each month following a month in which Failure Payments accrued. Nothing herein shall limit the Holder’s right to pursue
actual damages (to the extent in excess of the Failure Payments) for the Company’s Event of Failure, and the Holder shall have the right to pursue all remedies available at law or in equity (including a decree of specific performance and/or
injunctive relief). If a particular Event of Failure results in an Event of Default pursuant to Section 11 hereof, then the Failure Payment, for that Event of Failure only, shall be considered to have been satisfied upon payment to the Holder
of an amount equal to the greater of (i) the Failure Payment, or (ii) the Default Amount, payable in accordance with Section 11. 

  
 14. 

 (d) Maximum Interest Rate. Nothing contained herein or in any document referred to herein or delivered in
connection herewith shall be deemed to establish or require the payment of a rate of interest or other charges in excess of the maximum permitted by applicable law. In the event that the rate of interest or dividends required to be paid or other
charges hereunder exceed the maximum permitted by such law, any payments in excess of such maximum shall be credited against amounts owed by the Company to the Holder and thus refunded to the Company. 

11. Default. 
 (a) Events Of Default. Each of the
following events shall be considered to be an “Event of Default” unless waived by the Holder: 
 (i) Failure To Deliver Shares. A Delivery
Failure (as defined above) occurs and remains uncured for a period of more than twenty (20) days or at any time, the Company announces or states in writing that it will not honor its obligations to issue Shares to the Holder upon Exercise by
the Holder of the Exercise rights of the Holder in accordance with the terms of this Warrant; 
 (ii) Legend Removal Failure. A Legend Removal
Failure (as defined above) occurs and remains uncured for a period of twenty (20) days; 
 (iii) Transfer Delivery Failure. Transfer Delivery
Failure (as defined above) occurs and remains uncured for a period of twenty (20) days; 
 (iv) Corporate Existence; Major Transaction.
(A) The Company has failed to obtain the written agreement of the Successor Entity, or to cause the Successor Entity to take the actions required, pursuant to Section 5(c)(iv) or (B) with respect to a Major Transaction that is to be
treated as an Assumption under the terms hereof, the Company has failed to meet the Assumption requirements of Section 5(c)(ii); and 
 (v) Failure
to Effect Registration. With respect to all Registration Failures, a Registration Failure occurs and remains uncured for a period of more than thirty (30) days. 

(b) Mandatory Early Termination. 
 (i) Mandatory Early
Termination Amount. If any Events of Default shall occur then, unless waived by the Holder, upon the occurrence and during the continuation of any Event of Default, at the option of the Holder, such option exercisable through the delivery of
written notice to the Company by such Holder (the “Default Notice”), the Company shall be obligated to terminate the outstanding amount of this Warrant and pay to the Holder (a “Mandatory Early Termination”), in full satisfaction
of its obligations hereunder by delivery of a notice to such effect to the Holder within two (2) Business Days following receipt of the Default Notice, an amount payable in cash (the “Default Amount”) equal to the greater of
(1) the Black-Scholes value (as determined in accordance with Section 10(b)) of the remaining unexercised portion of this Warrant (without regard to any ownership limitations hereunder) on the date of such Default Notice and (2) the
Black-Scholes value (also as determined in accordance with Section 10(b)) of the remaining unexercised portion of this Warrant (without regard to any ownership limitations hereunder) on the Trading Day immediately preceding the date that the
Mandatory Early Termination Amount is paid to the Holder. 
 The Mandatory Early Termination Amount shall be payable within five (5) Business Days
following the date of the applicable Default Notice. 
 (ii) Liquidated Damages. The parties hereto acknowledge and agree that the sums payable as
Failure Payments or pursuant to a Mandatory Early Termination shall give rise to liquidated damages and not penalties. The parties further acknowledge that (i) the amount of loss or damages likely to be incurred by the Holder is incapable or is
difficult to precisely estimate, (ii) the amounts specified bear a reasonable proportion and are not plainly or grossly 

  
 15. 

 
disproportionate to the probable loss likely to be incurred by the Holder, and (iii) the parties are sophisticated business parties and have been represented by sophisticated and able legal
and financial counsel and negotiated this Agreement at arm’s length. 
 The Default Amount, together with all other amounts payable hereunder, shall
immediately become due and payable, all without demand, presentment or notice, all of which hereby are expressly waived, together with all costs, including, without limitation, legal fees and expenses, of collection, and the Holder shall be entitled
to exercise all other rights and remedies available at law or in equity. 
 (c) Posting Of Bond. In the event that any Event of Default occurs
hereunder, the Company may not raise as a legal defense (in any Lawsuit, as defined below, or otherwise) or justification to such Event of Default any claim that such Holder or anyone associated or affiliated with such Holder has been engaged in any
violation of law, unless the Company has posted a surety bond (a “Surety Bond”) for the benefit of such Holder in the amount of 130% of the aggregate Surety Bond Value (as defined below) of all of the Holder’s Warrants (the “Bond
Amount”), which Surety Bond shall remain in effect until the completion of litigation of the dispute and the proceeds of which shall be payable to such Holder to the extent Holder obtains judgment. 

For purposes hereof, a “Lawsuit” shall mean any lawsuit, arbitration or other dispute resolution filed by either party herein pertaining to any of
this Warrant, the Facility Agreement and the Registration Rights Agreement. 
 “Surety Bond Value,” for the Warrants shall mean 130% of the of the
Black-Scholes value of the remaining unexercised portion of this Warrant on the Trading Day immediately preceding the date that such bond goes into effect). 

(d) Injunction And Posting Of Bond. In the event that the Event of Default referred to in subsection (c) above pertains to the Company’s
failure to deliver unlegended shares of Common Stock to the Holder pursuant to a Warrant Exercise, legend removal request, or otherwise, the Company may not refuse such unlegended share delivery based on any claim that such Holder or anyone
associated or affiliated with such Holder has been engaged in any violation of law, unless an injunction from a court, on prior notice to Holder, restraining and or enjoining Exercise of all or part of said Warrant shall have been sought and
obtained by the Company and the Company has posted a Surety Bond for the benefit of such Holder in the amount of the Bond Amount, which Surety Bond shall remain in effect until the completion of litigation of the dispute and the proceeds of which
shall be payable to such Holder to the extent Holder obtains judgment. 
 (e) Remedies, Other Obligations, Breaches And Injunctive Relief. The
remedies provided in this Warrant shall be cumulative and in addition to all other remedies available under this Warrant and the Facility Agreement, at law or in equity (including a decree of specific performance and/or other injunctive relief), and
nothing herein shall limit the right of the Holder to pursue actual damages for any failure by the Company to comply with the terms of this Warrant. The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable
harm to the Holder and that the remedy at law for any such breach may be inadequate. The Company therefore agrees that, in the event of any such breach or threatened breach, the holder of this Warrant shall be entitled, in addition to all other
available remedies, to an injunction restraining any breach, without the necessity of showing economic loss and without any bond or other security being required. 

11. Holder’s Early Terminations. 
 In the event that
the Company does not deliver the Major Transaction Warrant Early Termination Price or the Default Amount, as the case may be, to the Holder within the time period or as otherwise required pursuant to the terms hereof, at any time thereafter the
Holder shall have the option, upon notice to the Company, in lieu of early termination, to require the Company to promptly return to the Holder all or any portion of this Warrant that was submitted for early termination or exercise. Upon the
Company’s receipt of such notice, (x) the applicable early termination or exercise, as the case may be, shall be null and void with respect to such applicable portion of this Warrant and (y) the Company shall immediately return this
Warrant, or issue a new Warrant to the Holder representing the portion of this Warrant that was submitted for early termination or exercise. The Holder’s delivery of a notice voiding an early termination or exercise and exercise of its rights
following such notice shall not affect the Company’s obligations to make any payments of Failure Payments which have accrued prior to the date of such notice with respect to the Warrant subject to such notice. 

  
 16. 

 12. Benefits of this Warrant. 

Nothing in this Warrant shall be construed to confer upon any person other than the Company and Holder any legal or equitable right, remedy or claim under
this Warrant and this Warrant shall be for the sole and exclusive benefit of the Company and Holder. 
 13. Governing Law. 

All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be governed by and construed and enforced in
accordance with the laws of the State of New York applicable to contracts made and to be performed in such State. All legal proceedings concerning the interpretations, enforcement and defense of the transactions contemplated by this Warrant (whether
brought against a party or its respective affiliates, directors, officers, shareholders, 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,
and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is improper or is an inconvenient
venue for such proceeding. Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof via registered or certified mail or overnight delivery
(with evidence of delivery) to such party at the address in effect for notices to it under this Warrant 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. The parties hereby waive all rights to a trial by jury. 
 14. Loss
of Warrant. 
 Upon receipt by the Company of evidence of the loss, theft, destruction or mutilation of this Warrant, and (in the case of loss, theft or
destruction) of indemnity or security or an affidavit of loss, theft or destruction, reasonably satisfactory to the Company, and upon surrender and cancellation of this Warrant, if mutilated, the Company shall execute and deliver a new Warrant of
like tenor and date. 
 15. Notice or Demands. 

Notices or demands pursuant to this Warrant to be given or made by Holder to or on the Company shall be sufficiently given or made if sent by mail, electronic
mail or facsimile per the addresses or numbers, as the case may be, set forth in Section 2 hereof, until another address or number is designated in writing by the Company. Notices or demands pursuant to this Warrant to be given or made by the
Company to or on Holder shall be sufficiently given or made if sent by certified or registered mail, return receipt requested, postage prepaid, and addressed, to the address of Holder set forth in the Company’s records, until another address is
designated in writing by Holder. 
 16. Amendment; Waiver. 

The terms and provisions of this Warrant shall not be amended or waived except in a writing signed by the Company and the Holder, provided that the Company
and the Required Holders may in writing amend the Warrants on behalf of all of the holders of Warrants. 

  
 17. 

 IN WITNESS WHEREOF, the undersigned has executed this Warrant as of the 2nd day of June, 2014. 

 

			
	KEMPHARM, INC.
		
	By:	 	 /s/ Travis S. Mickle

	Name:	 	Travis C. Mickle
	Title:	 	President and CEO

  
 18. 

 EXHIBIT A 

EXERCISE FORM FOR WARRANT 
 TO:
[            ] 
 CHECK THE APPLICABLE BOX: 

 

	 ̈	Cash Exercise or Cashless Exercise 

 The undersigned hereby irrevocably exercises
the attached warrant (the “Warrant”) with respect to Shares of Kempharm, Inc., a Delaware corporation (the “Company”), and, if pursuant to a Cashless Exercise, herewith makes payment of the Exercise Price with respect to such
shares in full, all in accordance with the conditions and provisions of said Warrant. 
  

	 ̈	[IF APPLICABLE: The undersigned hereby encloses $             as payment of the Exercise Price.] 

 

	 ̈	[IF APPLICABLE: The undersigned hereby agrees to cancel $             of principal outstanding under Notes of the Company held by the Holder.]

 1. The undersigned requests that any stock certificates for such shares be issued free of any restrictive legend, if appropriate, and, if
requested by the undersigned, a warrant representing any unexercised portion hereof be issued, pursuant to the Warrant in the name of the undersigned and delivered to the undersigned at the address set forth below. 

2. Capitalized terms used but not otherwise defined in this Exercise Form shall have the meaning ascribed thereto in the Warrant. 

 

	
	Dated:
                                    
	
	  

	Signature
	
	  

	Print Name
	
	  

	Address

 NOTICE 
 The signature to the
foregoing Exercise Form must correspond to the name as written upon the face of the attached Warrant in every particular, without alteration or enlargement or any change whatsoever. 

  
 19. 

 EXHIBIT B 

ASSIGNMENT 
 (To be executed by
the registered holder 
 desiring to transfer the Warrant) 

FOR VALUE RECEIVED, the undersigned holder of the attached warrant (the “Warrant”) hereby sells, assigns and transfers unto the person or persons
below named the right to purchase              Shares (as defined in the Warrant) of Kempharm, Inc., a Delaware corporation, evidenced by the attached Warrant and does hereby irrevocably
constitute and appoint              attorney to transfer the said Warrant on the books of the Company, with full power of substitution in the premises. 

 

					
	Dated:
                                    	 		 	  

		 		 	Signature
			
	Fill in for new registration of Warrant:	 		 	
			
	  
	 		 	
	Name	 		 	
			
	  
	 		 	
	Address	 		 	
			
	  
	 		 	
	Please print name and address of assignee	 		 	
	(including zip code number)	 		 	

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

  
 20. 

 EXHIBIT C 

FORM OF OPINION 

            , 20     

[            ] 

Re: [         ] (the “Company”) 

Dear Sir: 

[            ]
(“[            ]”) intends to transfer              Warrants (the “Warrants”) of the Company to
             (“            ”) without registration under the Securities Act of 1933, as amended (the “Securities
Act”). In connection therewith, we have examined and relied upon the truth of representations contained in an Investor Representation Letter attached hereto and have examined such other documents and issues of law as we have deemed relevant.

 Based on and subject to the foregoing, we are of the opinion that the transfer of the Warrants by
             to              may be effected without registration under the Securities Act, provided, however, that the Warrants
to be transferred to              contain a legend restricting its transferability pursuant to the Securities Act and that transfer of the Warrants is subject to a stop order. 

The foregoing opinion is furnished only to              and may not be used, circulated, quoted or
otherwise referred to or relied upon by you for any purposes other than the purpose for which furnished or by any other person for any purpose, without our prior written consent. 

Very truly yours, 

  
 21. 

 Schedule 1 

Black-Scholes Value 
  

					
	 	  	 Calculation Under Section 5(c)(iii)
	  	 Calculation Under Section 10(b) or 11(b)

			
	Number of Shares	  	The number of Warrant Shares subject to such redemption.	  	The number of Warrant Shares subject to such redemption.
			
	Remaining Term	  	If the Major Transaction is consummated prior to the IPO Event, the number of days from the earlier of (i) the date of execution of a definitive agreement with respect to such Major Transaction and (ii) the date of the Major
Transaction Notice, until the last date on which the Warrant may be Exercised; if the Major Transaction is consummated after the IPO Event, the number of calendar days from the earlier of (x) date of public announcement of the Major Transaction and
(y) the date of the Major Transaction Notice, until the last date on which the Warrant may be Exercised.	  	Number of calendar days from date of the Event of Failure until the last date on which the Warrant may be exercised.
			
	Interest Rate	  	A risk-free interest rate corresponding to the US$ LIBOR/Swap rate for a period equal to the Remaining Term.	  	A risk-free interest rate corresponding to the US$ LIBOR/Swap rate for a period equal to the Remaining Term.
			
	Cost to Borrow	  	Zero	  	Zero
			
	Volatility	  	60%	  	60%
			
	Stock Price	  	Pre-IPO Event	  	The Volume Weighted Average Price of a shares of Common Stock on the date of such calculation (if following the Mandatory Conversion Time) and the Fair Market Value of an Applicable Share at the time of such calculation
(if prior to the Mandatory Conversion Time).
		  	(A) Cash-Out Major Transaction; Cash Portion of Mixed Major Transaction	  
			
		  	The greater of (i) the amount of cash payable or distributable per Applicable Share pursuant to the terms of the Charter in connection with such Major Transaction and (ii) the per share amount of cash consideration payable per
Applicable Share in connection with such Major Transaction.	  	
			
		  	“Applicable Share” means (1) following the Mandatory Conversion Time, a share of Common Stock and (2) prior to the Mandatory	  	

  
 22. 

					
		  	Conversion Time, whichever of (x) and (y) would result in a greater calculation where (x) is a share of Series D Preferred Stock and (y) is a number of shares of Common Stock equal to the prevailing Per Share Underlying Common
Amount.	  	
			
		  	“Mixed Major Transaction” means a Major Transaction in which the consideration payable to holders of Applicable Shares consists partially of cash and partially of securities of a Successor Entity (and potentially other
non-cash property).	  	
			
		  	(B) Non-Cash Major Transaction; Non-Cash Portion of Mixed Major Transaction	  	
			
		  	The greater of (i) the Fair Market Value of the shares of such Successor Entity and the other property (other than cash) payable or distributable per Applicable Share pursuant to the terms of the Charter in connection with such
Major Transaction and (ii) the sum of (A) the Fair Market Value of the property (excluding cash and shares of such Successor Entity) payable per Applicable Share in connection with such Major Transaction and (B) the number of shares
of such Successor Entity issuable in such Major Transaction per Applicable Share multiplied by (x) in the case of publicly-traded shares of a Publicly Traded Successor Entity, the greater of (1) closing price per share of common stock of
such Publicly Traded Successor Entity on the principal market on which such common stock is traded or listed (the “Successor Closing Market Price”) as of the date immediately preceding the first public announcement of the Major
Transaction, (2) the Successor Closing Market Price on the trading day immediately preceding the date on which a Major Transaction is consummated and (3) the first Successor Closing Market Price following the first public announcement of a
Major Transaction or (y) in the case of shares of a non-publicly traded Successor Entity (or non-publicly-traded shares in a transaction with a publicly-traded Successor Entity), the Fair Market Value for each share of the Successor Entity
issuable or distributable in such Major Transaction. In the event of a Major Transaction with a Private Successor Entity that is not a Cash-Out Major Transaction and that is being treated as a redemption hereunder, the Company shall cause the
Successor Entity to provide the Holder with appropriate and reasonable access to information (subject to execution by the Holder	  	

					
		  	of a non-disclosure agreement in customary and reasonable form) to determine the Fair Market Value of its shares as per this Schedule and to submit any dispute with the Holder as to such determination to a dispute resolution similar
to that provided in Section 3(b) hereof.	  	
			
		  	“Non-Cash Major Transaction” means a Major Transaction in which the consideration payable to holders of Applicable Shares in connection with such Major Transaction includes securities of a Successor Entity, but does not
include cash.	  	
			
		  	(C) All Other Major Transactions (Pre-IPO Event). The Fair Market Value of a Warrant Share on the date of such calculation.	  	
			
		  	Post-IPO Event:	  	
			
		  	The greater of (1) the closing price of the Common Stock on NASDAQ, or, if that is not the principal trading market for the Common Stock, such principal market on which the Common Stock is traded or listed (the “Closing Market
Price”) on the trading day immediately preceding the date on which a Major Transaction is consummated, (2) the first Closing Market Price following the first public announcement of a Major Transaction, (3) the Closing Market Price as of the
date immediately preceding the first public announcement of the Major Transaction or (4) the amount of any consideration payable per Applicable Share in such Major Transaction. In the event such calculation is made prior to the Mandatory Conversion
Time and the Warrant is then Exercisable for shares of Series D Preferred Stock, such prices described in (1), (2) and (3) shall be multiplied by the Per Share Underlying Common Amount.	  	
			
	Dividends	  	Zero.	  	Zero
			
	Strike Price	  	The Exercise Price (as defined in Section 3(a)).	  	The Exercise Price (as defined in Section 3(a).EX-10.6

 EXHIBIT 10.6 

THE SECURITIES EVIDENCED BY THIS INSTRUMENT HAVE NEITHER BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), NOR THE
SECURITIES LAWS OF ANY STATE, AND HAVE BEEN TAKEN FOR INVESTMENT PURPOSES ONLY, AND NOT WITH A VIEW TO THE DISTRIBUTION THEREOF. SUCH SECURITIES MAY NOT BE SOLD, PLEDGED OR TRANSFERRED (I) ABSENT COMPLIANCE WITH THE COMPANY’S ARTICLES OR
CERTIFICATE OF INCORPORATION AND BYLAWS, AS EACH ARE AMENDED FROM TIME TO TIME, AND (II) UNLESS THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS COVERING SUCH SECURITIES OR THE COMPANY RECEIVES AN
OPINION OF COUNSEL (WHICH MAY BE COUNSEL FOR THE COMPANY), REASONABLY SATISFACTORY IN FORM AND CONTENT TO THE COMPANY, STATING THAT SUCH SALE OR TRANSFER IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF THE ACT AND APPLICABLE
STATE SECURITIES LAWS. 
 KEMPHARM, INC. 

WARRANT TO PURCHASE 

311,000 SHARES OF COMMON STOCK 

For and in consideration of $1.00, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged,
KemPharm, Inc., an Iowa corporation (the “Company”), hereby grants to the Virginia Tech Foundation, Inc. (including any permitted subsequent holder hereof, “Holder”), the right to purchase from the Company at any time after the
date hereof 311,000 shares of the Company’s common stock, at a purchase price equal to $0.62 per Common Share (the “Purchase Price”), in accordance herewith and subject to the terms and conditions set forth herein. As used herein, the
term “Common Shares” shall mean the Company’s presently authorized common stock, and any stock into or for which such common stock may hereafter be converted or exchanged. 

1. Exercise of Warrant.  

To exercise this Warrant in whole or in part, the Holder shall deliver to the Company at its principal office: (a) a written notice,
substantially in the form of the Subscription Form attached as Exhibit A hereto, of such Holder’s election to exercise this Warrant, which notice shall specify the number of Common Shares to be purchased, (b) cash or a certified
check payable to the Company in an amount equal to the aggregate purchase price of the number of Common Shares being purchased and (c) this Warrant. The Company shall as promptly as practicable, execute and deliver or cause to be executed and
delivered, in accordance with such notice, a certificate or certificates representing the aggregate number of Common Shares specified in such notice. Such certificate or 

  
 1. 

 
certificates shall be deemed to have been issued and such holder or any other person so designated to be named therein shall be deemed for all purposes to have become a holder of record of such
Common Shares as of the date such notice is received by the Company as aforesaid. If this Warrant shall have been exercised only in part, the Company shall, at the time of delivery of said certificate or certificates, deliver to such holder a new
Warrant evidencing the rights of such holder to purchase the remaining Common Shares called for by this Warrant, which new Warrant shall in all other respects be identical to this Warrant, or, at the request of such holder, appropriate notation may
be made on this Warrant and the same returned to such holder. The Company shall pay all expenses, taxes and other charges payable in connection with the preparation, issue and delivery of such Common Share certificates and new Warrant(s) (other than
any applicable income taxes to be paid by Holder), except that, in case such share certificates or new Warrant(s) shall be registered in a name or names other than the name of the holder of this Warrant (to the extent permitted hereunder), funds
sufficient to pay all transfer taxes that are payable upon the issuance of such certificate or certificates or new Warrant(s) shall be paid by the holder hereof at the time of delivering the notice of exercise mentioned above. The Holder’s
right to exercise this Warrant, in whole or in part, shall terminate in its entirety upon the tenth anniversary of the date of this Warrant. 

All Common Shares issued upon the exercise of this Warrant shall be validly issued. 

2. Transfer, Division and Combination.  

The Company agrees to maintain at its principal office, books for the registration and transfer of the Warrant, and, subject to the provision
of Sections 2 and 7 hereof, this Warrant and all rights hereunder are transferable, in whole, on such books at such office, upon surrender of this Warrant together with a written assignment of this Warrant (in form substantially similar to
Exhibit B attached hereto) duly executed by the holder hereof or his agent or attorney and funds sufficient to pay any transfer taxes payable upon the making of such transfer. Upon such surrender and payment, the Company shall execute and
deliver a new Warrant or Warrants in the name of the assignee or assignees and in the denominations specified in such instrument of assignment, and this Warrant shall promptly be canceled. If and when this Warrant is assigned in blank, the Company
may (but shall not be obliged to) treat the bearer hereof as the absolute owner of this Warrant for all purposes, and the Company shall not be affected by any notice to the contrary. A Warrant may be exercised by a new holder for the purchase of
Common Shares without having a new Warrant issued. 
 This Warrant may be divided or combined with other Warrants upon presentation hereof
at such principal office, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by the holder hereof or his agent or attorney. Subject to compliance with the preceding paragraph and
Section 7 hereof as to any transfer that may be involved in such division or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided or combined in accordance with such
notice. 

  
 2. 

 3. Notices.  

In case the Company proposes 

(a) to grant to the holders of its Common Shares as a class any rights or options, or 

(b) to effect any capital reorganization or reclassification of the equity of the Company, or 

(c) to consolidate with, or merge into, any other entity or to transfer its property as an entirety or substantially as an entirety, or 

(d) to effect the liquidation, dissolution or winding up of the Company, 

then the Company shall cause notice of any such intended action to be given to all holders of record of outstanding Warrants not less than 10
days before the date on which the transfer books of the Company shall close or a record be taken for such granting of rights or options, or the date when such capital reorganization, reclassification, consolidation, merger, transfer, liquidation,
dissolution or winding up shall be effective, as the case may be. 
 Any notice or other document required or permitted to be given or
delivered to holders of record of Warrants shall be mailed first-class postage prepaid to each such holder at the last address shown on the books of the Company maintained for the registry and transfer of the Warrants. Any notice or other document
required or permitted to be given or delivered to holders of record of Common Shares issued pursuant to Warrants shall be mailed first-class postage prepaid to each such holder at such holder’s address as the same appears on the records of the
Company. Any notice or other document required or permitted to be given or delivered to the Company shall be mailed first-class postage prepaid to the principal office of the Company, or delivered to the office of one of the Company’s executive
officers at such address, or such other address within the United States of America as shall have been furnished by the Company to the holders of record of such Warrants and the holders of record of such Common Shares. 

4. Limitation of Liability; Not a Shareholder.  

No provision of this Warrant shall be construed as conferring upon the Holder, as such, any right whatsoever as a Shareholder of the Company,
including without limitation the right to vote or to consent or to receive notice as a Shareholder in respect of meetings of Shareholders for the election of Directors of the Company or any other matter whatsoever as a Shareholder of the Company. No
provision hereof, in the absence of affirmative action by the Holder hereof to purchase Common Shares, and no mere enumeration herein of the rights or privileges of the Holder hereof, shall give rise to any liability of such holder for the purchase
price or as a Shareholder of the Company, whether such liability is asserted by the Company, creditors of the Company or others. 

  
 3. 

 5. Loss, Destruction, etc. of Warrant.  

Upon receipt of evidence satisfactory to the Company of the loss, theft, mutilation or destruction of any Warrant, and in the case of any such
loss, theft or destruction upon delivery of a bond of indemnity in such form and amount as shall be reasonably satisfactory to the Company, or in the event of such mutilation upon surrender and cancellation of the Warrant, the Company will make and
deliver a new Warrant, of like tenor, in lieu of such lost, stolen, destroyed or mutilated Warrant. Any Warrant issued under the provisions of this Section 5 in lieu of any Warrant alleged to be lost, destroyed or stolen, or of any mutilated
Warrant, shall constitute an original contractual obligation on the part of the Company. 
 6. Adjustment upon Changes in Common
Shares.  
 (a) If all or any portion of this Warrant shall be exercised subsequent to any split, dividend, recapitalization,
combination of Shares of the Company, or other similar event, occurring after the date hereof, then the Holder exercising this Warrant shall receive, for the aggregate Purchase Price, the equity securities of any class or classes or other securities
or property which such Holder would have received if this Warrant had been exercised immediately prior to such split, dividend, recapitalization, combination of Shares, or other similar event. Whenever there shall be an adjustment pursuant to this
Section 6(a), the Company shall forthwith notify the Holder or Holders of this Warrant of such adjustment, setting forth in reasonable detail the event requiring the adjustment and the method by which such adjustment was calculated. 

(b) If all or any portion of this Warrant shall be exercised subsequent to any merger, consolidation, exchange of Shares, separation,
reorganization or liquidation of the Company, or other similar event, occurring after the date hereof, as a result of which the Common Shares shall be changed into the same or a different number of Shares of the same or another class or classes of
securities of the Company or another entity, or the holders of Shares are entitled to receive cash or other property, then the Holder exercising this Warrant shall receive, for the aggregate Purchase Price, the aggregate number and class of shares,
interests, cash or other property which such Holder would have received if this Warrant had been exercised immediately prior to such merger, consolidation, exchange, separation, reorganization or liquidation, or other similar event. Whenever there
shall be an adjustment pursuant to this Section 6(b), the Company shall forthwith notify the Holder or Holders of this Warrant of such adjustment, setting forth in reasonable detail the event requiring the adjustment and the method by which
such adjustment was calculated. 
 (c) The Company shall not amend its Articles of Incorporation or its By-Laws, as amended from time to
time, or participate in any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, in each case for the purpose of avoiding or seeking to avoid the observance or performance
of any of the terms to be observed or performed hereunder by the Company, but shall at all times in good faith use its best efforts, and assist in carrying out all such action as may be reasonably necessary or appropriate in order to protect the
rights of the Holder against dilution or other impairment. 

  
 4. 

 7. Restrictions on Transfer; Shareholder Agreement; Legend. This Warrant may not be
endorsed, assigned and/or transferred in whole or in part by the Holder (a) except in accordance with the restrictions on transfer contained in the Company’s articles or certificate of incorporation and bylaws, as each are amended from
time to time, and any Shareholder Agreement, if the Holder is a Shareholder of the Company at the time of such actual, proposed, or purported endorsement, assignment and/or transfer, or (b) without the prior express written consent of holders
of at least two-thirds (2/3) of the Common Shares of the Company, if the Holder is not a Shareholder of the Company at the time of such actual, proposed, or purported endorsement, assignment and/or transfer. The transferability of the Common
Shares issuable upon the exercise hereof is subject to the Company’s articles or certificate of incorporation and bylaws, as each are amended from time to time, and any Shareholder Agreement. Each taker and holder of this Warrant, by taking or
holding same, agrees to execute any documents reasonably requested by the Company to acknowledge and become a party to any Shareholder Agreement at such time as the Warrant is exercised in whole or in part. As used herein, “Shareholder
Agreement” means any agreement among the Company and those persons holding all or a majority of the Company’s Common Shares that concerns the ownership or transferability of Common Shares and rights and obligations related to such
ownership. Each certificate for Common Shares issued upon the exercise of this Warrant and each certificate issued upon the direct or indirect transfer of any such shares shall be stamped or otherwise imprinted with each legend required by the
Company’s articles or certificate of incorporation and bylaws, as each are amended from time to time, and, unless duplicative of such legends, a legend in substantially the following form: 

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES
LAWS AND NEITHER THE SECURITIES NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT OR SUCH LAWS OR AN EXEMPTION FROM REGISTRATION UNDER
SUCH ACT AND SUCH LAWS. 
 THE SECURITIES REPRESENTED HEREBY ARE SUBJECT TO THE PROVISIONS OF THE COMPANY’S ARTRICLES OR CERTIFICATE OF
INCORPORATION AND BYLAWS, AS EACH ARE AMENDED FROM TIME TO TIME, AND ONE OR MORE SHAREHOLDER AGREEMENTS, AS AMENDED FROM TIME TO TIME, COPIES OF WHICH ARE ON FILE AT THE PRINCIPAL OFFICE OF THE COMPANY, WITH RESPECT TO VOTING AND TRANSFERS OF
SECURITIES AND CERTAIN OBLIGATIONS RELATING TO OWNERSHIP OF SECURITIES, AND NO TRANSFER HEREOF MAY BE MADE EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF SUCH AGREEMENT. 

INFORMATION REGARDING THE DESIGNATIONS, RELATIVE RIGHTS, PREFERENCES AND LIMITATIONS APPLICABLE TO EACH CLASS OR SERIES OF SHARES OF THE
COMPANY, THE VARIATIONS THEREIN 

  
 5. 

 
AND THE AUTHORITY OF THE BOARD OF DIRECTORS TO DETERMINE VARIATIONS FOR FUTURE CLASSES OR SERIES MAY BE OBTAINED AT NO COST BY WRITTEN REQUEST MADE BY THE HOLDER OF RECORD HEREOF TO THE SECRETARY
OF THE COMPANY AT THE PRINCIPAL EXECUTIVE OFFICE OF THE COMPANY. 
 Notwithstanding the foregoing, the Holder may require the Company to
issue a certificate for Common Shares without the first of the foregoing legends if either (i) such Common Shares have been registered for resale under the Act, or (ii) the Holder has delivered to the Company an opinion of legal counsel,
which opinion shall be addressed to the Company and be reasonably satisfactory in form and substance to the Company’s counsel, to the effect that such registration is not required with respect to such Common Shares. 

8. Notices. All notices and other communications from the Company to the holder of this Warrant shall be mailed by first-class
registered or certified mail, postage prepaid, to the address furnished to the Company in writing by the last holder of this Warrant who shall have furnished an address to the Company in writing. 

9. Change; Waiver. Neither this Warrant nor any term hereof may be changed, waived, discharged or terminated orally but only by an
instrument in writing signed by the party against which enforcement of the change, waiver, discharge or termination is sought. 
 10.
Headings. The headings in this Warrant are for purposes of convenience of reference only and shall not be deemed to constitute a part hereof. 

11. Law Governing. This Warrant shall be construed and enforced in accordance with and governed by the internal laws of the
Commonwealth of Virginia without reference to the choice of law provisions of any jurisdiction. 
 12. Variation in Pronouns. All
pronouns shall be deemed to refer to masculine, feminine, neuter, singular, or plural, as the identity of the person or persons may require. 

[Remainder of Page Intentionally Left Blank] 

  
 6. 

 IN WITNESS WHEREOF, the undersigned has executed this Warrant as of September 8, 2009. 

 

			
	KemPharm, Inc.
		
	By:	 	 /s/ Travis Mickle

		 	Travis Mickle, President, CEO

  

			
	ACKNOWLEDGED AND AGREED:
	
	HOLDER
	
	Virginia Tech Foundation, Inc.
		
	By:	 	 [No Counterpart Signature Obtained]

  
 7. 

 EXHIBIT A 

SUBSCRIPTION FORM 
 (To be
executed only upon exercise of Warrant) 
 The undersigned, the holder of the foregoing Warrant, hereby elects to exercise purchase rights
represented by such Warrant for, and to purchase thereunder,              Common Shares of KEMPHARM, INC. covered by such Warrant and herewith makes payment in full therefor of U.S.
$             cash, and requests that certificates for such Common Shares (and any securities or property deliverable upon such exercise) be issued in the name of and delivered to
                                         
                                         
              
whose address is                                    
                                         
                                         
                                         
                             

                          
                                         
                                         
                                         
                                         
                         

                          
                                         
                                         
                                         
                                         
                       . 

The undersigned agrees that the undersigned is acquiring such Common Shares for investment and not with a view to distribution thereof and
that the certificate or certificates representing such Common Shares may bear a legend substantially as follows: 
 “The securities
represented by this certificate have not been registered under the Securities Act of 1933, as amended, or any state securities laws and neither the securities nor any interest therein may be offered, sold, transferred, pledged or otherwise disposed
of except pursuant to an effective registration statement under such act or such laws or an exemption from registration under such act and such laws.” 

“The securities represented hereby are subject to the provisions of the Company’s articles or certificate of incorporation and
bylaws, as each are amended from time to time, and one or more Shareholder Agreement, as amended from time to time, copies of which is on file at the principal office of the Company, with respect to voting and transfers of securities and certain
obligations relating to ownership of securities, and no transfer hereof may be made except in accordance with the provisions of such agreement.” 

“Information regarding the designations, relative rights, preferences and limitations applicable to each class or series of shares of the
Company, the variations therein, and the authority of the board of directors to determine variations for future classes or series may be obtained at no cost by written request made by the holder of record hereof to the secretary of the Company at
the principal executive office of the Company.” 
  

							
		 		 		 	  

	Dated:	 		 		 	Signature guaranteed:

  
 8. 

 EXHIBIT B 

FORM OF ASSIGNMENT 
 FOR VALUE
RECEIVED the undersigned registered owner of this Warrant hereby sells, assigns and transfers unto the Assignee named below all of the rights of the undersigned under the within Warrant, with respect to the number of Common Shares set forth below:

  

					
	 Name of Assignee
	 	 Address
	 	 No. of Shares

		 		 	
		 		 	
		 		 	

 and does hereby irrevocably constitute and appoint
                                         
                    Attorney to make such transfer on the books of KEMPHARM, INC., maintained for the purpose, with full power of substitution in the
premises. 
 DATED:
                                         
            
  

	
	  

	(Signature)
	
	  

	(Witness)

  
 9.

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