Document:

Exhibit 4.1

 

THIS NOTE AND THE SECURITIES ISSUABLE UPON
CONVERSION HEREOF HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”),
OR APPLICABLE STATE SECURITIES LAWS AND MAY BE OFFERED, SOLD, ASSIGNED, PLEDGED, HYPOTHECATED, TRANSFERRED OR OTHERWISE DISPOSED
OF (EACH, A “TRANSFER”) ONLY IF SUCH SECURITIES ARE REGISTERED UNDER THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES
LAWS OR IF SUCH TRANSFER IS MADE PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT AND SUCH STATE SECURITIES
LAWS AFTER PROVIDING AN OPINION OF COUNSEL TO SUCH EFFECT.

 

SORRENTO THERAPEUTICS, INC. 

 

CONVERTIBLE PROMISSORY NOTE

 

	$10,000,000	Date: December 21, 2017

 

FOR VALUE RECEIVED,
SORRENTO THERAPEUTICS, INC., a Delaware corporation (the “Company”), promises to pay to
___________________ (the “Purchaser”), or its registered assigns, in lawful money of the United
States of America the principal sum of Ten Million Dollars ($10,000,000) (the “Principal
Amount”), or such lesser amount as shall equal the outstanding Principal Amount hereof, together with simple
interest from the date of this Note on the unpaid principal balance at a rate equal to 5.0% per annum (the
“Interest Rate”), computed on the basis of the actual number of days elapsed and a year of 365
days. All unpaid principal, together with any then unpaid and accrued interest and other amounts payable hereunder, shall be
due and payable, if not earlier converted, on the earlier to occur of: (1) December 21, 2022, and (ii) the date of the
closing of a Change in Control (as defined below) (the “Maturity Date”). This Note is one of the
“Notes” issued pursuant to that certain Securities Purchase Agreement dated December 11, 2017 (as
may be amended or restated from time to time, the “Securities Purchase Agreement”), among the
Company and the Purchasers (as defined in the Securities Purchase Agreement).

 

The following is a statement
of the rights of the Purchaser and the conditions to which this Note is subject, and to which the Purchaser, by the acceptance
of this Note, agrees:

 

1.           Definitions.
As used in this Note, the following capitalized terms have the following meanings:

 

(a)          “Change
in Control” means the occurrence of any of the following events: (i) any “person” (as such term is used
in Sections 13(d) and 14(d) of the Exchange Act) becomes the “beneficial owner” (as defined in Rule 13d-3 of the Exchange
Act), directly or indirectly, of securities of the Company representing 50% or more of the total voting power represented by the
Company’s then-outstanding voting securities, except that any change in the beneficial ownership of the securities of the
Company as a result of a private financing of the Company that is approved by the Company’s board of directors, shall not
be deemed to be a Change in Control; (ii) the consummation of the sale, lease, license or disposition by the Company of all or
substantially all of the Company’s assets; or (iii) the consummation of a merger or consolidation of the Company with any
other corporation, other than a merger or consolidation which would result in the voting securities of the Company outstanding
immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities
of the surviving entity or its parent) at least 50% of the total voting power represented by the voting securities of the Company
or such surviving entity or its parent outstanding immediately after such merger or consolidation.

 

     

     

    

(b)         “Common
Stock” means the Company’s common stock, $0.0001 par value per share.

 

(c)         “Conversion
Amount” has the meaning given in Section 6(a).

 

(d)         “Conversion
Date” has the meaning given in Section 6(a).

 

(e)         “Conversion
Price” means $2.26875, subject to adjustment as set forth in Section 6.

 

(f)          “Conversion
Shares” has the meaning given in Section 6(a).

 

(g)         “Event
of Default” has the meaning given in Section 4.

 

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

 

(i)          “Hercules
Loan Agreement” means the Loan and Security Agreement, dated as of November 23, 2016, by and among the Company, certain
subsidiaries of the Company, the several banks and other financial institutions or entities from time to time parties thereto as
Lender, and Hercules Capital, Inc., in its capacity as administrative agent and collateral agent for itself and the Lender, as
amended.

 

(j)          “Indebtedness”
means (i) indebtedness of the Company for borrowed money (including revolving credit line borrowings or indebtedness evidenced
by notes payable, commercial paper, interest that has accrued and become payable and the payment of which has been satisfied by
non-cash consideration, drafts accepted representing extensions of credit and unpaid reimbursement obligations in respect of letters
of credit), (ii) all obligations of the Company evidenced by notes, bonds, debentures or similar instruments, and (iii) all contingent
obligations or guarantees of the Company in respect of the foregoing, in each case other than indebtedness of the Company or any
subsidiary (a) evidenced by any of the Notes; (b) consisting of a lease or similar obligation relating to an equipment, operating
or capital lease; (c) consisting of trade payables incurred in the ordinary course of business; (d) that is unsecured, is made
expressly subordinate in right of payment to the indebtedness evidenced by the Notes pursuant to a written subordination agreement
that is reasonably acceptable to the Requisite Purchasers, and does not provide at any time for the payment, prepayment, repayment,
repurchase or defeasance, directly or indirectly, of any principal or premium thereon (if any) until at least 91 days after the
Maturity Date; or (e) intercompany debt or other amounts owed between or among the Company and any of its subsidiaries.

 

(k)         “Issuance
Date” means the date first written above.

 

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(l)          “New
Securities” means any equity security or other instrument of the Company that can be converted into, or exercised
or exchanged for equity securities of the Company; provided, however, that “New Securities”
shall not include (i) securities or other instruments issued or to be issued after the date hereof to employees, officers or directors
of, or consultants or advisors to, the Company or any subsidiary, pursuant to stock purchase or stock option plans or other arrangements
duly approved 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; (ii) securities or other instruments issued or issuable in
a registered public offering under the Securities Act; (iii) securities or other instruments issued pursuant to the exercise or
conversion of securities or other instruments outstanding as of the date hereof or pursuant to the conversion of any of the Notes;
(iv) securities or other instruments issued or issuable pursuant to the acquisition of another corporation by the Company by merger,
purchase of all or substantially all of the assets or other reorganization; (v) securities or other instruments issued in connection
with strategic transactions involving the Company and other entities, including without limitation, joint ventures, strategic partnerships
manufacturing, marketing or distribution arrangements, sponsored research, collaboration, technology license, development, original
equipment manufacturer, marketing or similar arrangements; (vi) securities or other instruments issued to suppliers or third-party
service providers in exchange for or as partial consideration for goods or services rendered to the Company pursuant to transactions
approved by the Board of Directors of the Company or a committee of the Board of Directors of the Company; (vii) securities or
other instruments issued pursuant to a settlement agreement for the purpose of resolving disputes related to the Company or any
of its wholly-owned subsidiaries; (viii) securities or other instruments issued pursuant to any equipment loan or leasing arrangement,
real property leasing arrangement, commercial property leasing arrangements or debt financing from a bank, broker or similar financial
or lending institution; (ix) securities or other instruments issued in one or more transactions the primary purpose of which is
not to raise capital; or (x) securities or other instruments that the Requisite Purchasers (as defined below) elect in writing
to exclude from the rights of first refusal set forth in Section 15. For the avoidance of doubt, “New Securities”
shall also include any additional debt securities that can be converted into, or exercised or exchanged into equity securities
of the Company to be issued by the Company pursuant to Section 16(a).

 

(m)        “Notice
of Conversion” has the meaning given in Section 6(a).

 

(n)         “Person”
means any individual, corporation (including any non-profit corporation), general partnership,
limited partnership, limited liability partnership, joint venture, estate, trust, company (including any limited liability company
or joint stock company), firm or other enterprise, association, organization, entity, domestic or foreign multinational, federal,
state, provincial, municipal or local government (or any political subdivision thereof) or any domestic or foreign governmental,
regulatory or administrative authority or any department, commission, board, agency, court, tribunal, judicial body or instrumentality
thereof, or any other body exercising, or entitled to exercise, any administrative, executive, judicial, legislative, police, regulatory
or taxing authority or power of any nature (including any arbitral body).

 

(o)         “Purchaser”
means the Person specified in the introductory paragraph of this Note or any Person who shall at the time be the registered holder
of this Note.

 

(p)         “Register”
has the meaning given in Section 12.

 

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(q)         “Registered
Notes” has the meaning given in Section 12.

 

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

 

(s)         “Securities
Purchase Agreement” has the meaning given in the introductory paragraph hereof.

 

2.           Interest.
Upon the conversion of any portion of the Principal Amount in accordance with Section 6, the Company shall repay to the
Purchaser in cash all accrued but unpaid interest on such portion of the Principal Amount being converted within five (5) business
days after the Conversion Date (as defined below). Otherwise, accrued but unpaid interest on this Note shall be due and paid to
the Purchaser in cash semiannually in arrears on or prior to the 30th day of June and 31st day of December
of each calendar year commencing with the calendar year ending December 31, 2018. Notwithstanding the above, all unpaid Principal
Amount as of the Maturity Date, together with any then unpaid and accrued interest and other amounts payable hereunder, shall be
immediately due and payable in cash on the Maturity Date.

 

3.           Prepayment.
The Company may not prepay the Principal Amount in whole or in part without the prior written consent of the Purchaser.

 

4.           Events
of Default. The occurrence of any of the following shall constitute an “Event of Default” under
this Note and the other Notes issued under the Securities Purchase Agreement unless the Company obtains the prior written consent
or wavier from the Requisite Purchasers:

 

(a)         the
Company fails to pay (i) the Principal Amount when due or (ii) any interest or any other amount due under this Note when due and
such failure continues for twenty (20) business days following the Company’s receipt of the Purchaser’s written notice
to the Company of such failure to pay;

 

(b)         the
Company fails to observe or perform in any material respect any of its covenants or obligations contained in this Note or the Securities
Purchase Agreement and such failure continues for more than forty-five days following the Company’s receipt of the Purchaser’s
written notice of such failure;

 

(c)         any
representation or warranty made or deemed made by the Company to the Purchaser in the Securities Purchase Agreement is materially
incorrect on the date as of which such representation or warranty was made or deemed made;

 

(d)         (i)
the Company makes an assignment for the benefit of creditors; (ii) an order, judgment or decree is entered adjudicating the Company
as bankrupt or insolvent; (iii) any order for relief with respect to the Company is entered under the U.S. Bankruptcy Code or any
other applicable bankruptcy or insolvency law; (iv) the Company petitions or applies to any tribunal for the appointment of a custodian,
trustee, receiver or liquidator of the Company to commence any proceeding relating to the Company under any bankruptcy, reorganization,
arrangement, insolvency, readjustment of debt, dissolution or liquidation law of any jurisdiction; or (v) any such petition or
application in (iv) above is filed, or any such proceeding is commenced, against the Company by any individual or entity in any
jurisdiction and either (x) the Company by any act indicates its approval thereof, consents thereto or acquiesces therein or (y)
such petition, application or proceeding is not dismissed or discharged within 120 days;

 

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(e)         (i)
any Indebtedness is not paid when due or (as the case may be) within any originally applicable grace period; (ii) any Indebtedness
becomes (or becomes capable of being declared) due and payable prior to its stated maturity otherwise than at the option of any
obligor or (except by reason of an event of default, howsoever described, under the terms of the agreement governing such indebtedness)
any person entitled to the payment of such Indebtedness; or (iii) any amount payable by the Company under any guarantee of any
Indebtedness (including any indemnity of such Indebtedness or any arrangement having a similar effect) of others given by any obligor
is not honored when due and called upon; provided, however, that the amount of Indebtedness referred to in paragraphs (i) and/or
(ii) above and/or the amount payable under any guarantee referred to in paragraph (iii) above individually or in the aggregate
exceeds US$2,500,000 (or its equivalent in any other currency or currencies);

 

(f)          one
or more final and non-appealable judgment(s) or order(s) not covered by insurance for the payment of an amount in excess of US$2,500,000
(or its equivalent in any other currency or currencies), whether individually or in aggregate, is or are rendered against the Company
or any of its majority-owned subsidiaries and continue(s) unsatisfied and unstayed for a period of 21 days after the date(s) thereof
or, if later, the date therein specified for payment;

 

(g)         one
or more events that have, or could reasonably be expected to have, a material adverse effect on (i) the Company’s ability
to comply with its obligations under any Transaction Document, or (ii) the rights of the Purchaser under this Note;

 

(h)         the
delisting or suspension of trading of the Common Stock on the Trading Market; provided, however, that such delisting or
suspension shall not be deemed an Event of Default if it is a result of any action or actions taken by the Securities and Exchange
Commission or the Trading Market, which action or actions were generally applicable and affected all issuers with a class of securities
listed on the Trading Market; and provided, further that any Event of Default triggered under this Section 4(h) shall
be deemed immediately and automatically cured when the Common Stock is relisted for trading on the Trading Market or the suspension
of trading ends;

 

(i)          the
Company sells, assigns, transfers, conveys or disposes of a material amount of its assets and such sale, assignment, transfer,
conveyance or disposition has a material adverse effect on the Company’s ability to comply with its obligations under this
Note;

 

(j)          the
Company acquires a material amount of assets and such acquisition has a material adverse effect on the Company’s ability
to comply with its obligations under this Note; or

 

(k)         the
Company takes any action that alters or changes the rights, preferences or privileges of the Notes as a class.

 

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5.           Rights
of the Purchaser upon Default. Upon the occurrence of any Event of Default and at any time thereafter during the continuance
of such Event of Default, the Purchaser may, by written notice to the Company, declare all outstanding Obligations to be immediately
due and payable without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived
by the Company, notwithstanding anything contained herein or in the Securities Purchase Agreement to the contrary. From and after
the occurrence and during the continuance of any Event of Default, the Interest Rate shall be automatically increased to 12.0%
per annum, computed on the basis of the actual number of days elapsed and a year of 365 days. In the event that such Event of Default
is subsequently cured (and no other Event of Default then exists), the adjustment referred to in the preceding sentence shall cease
to be effective as of the calendar day immediately following the date of such cure; provided that the interest as calculated
and unpaid at such increased rate during the continuance of such Event of Default shall continue to apply to the extent relating
to the days after the occurrence of such Event of Default through but excluding the date of such cure of such Event of Default.

 

6.           Conversion.

 

(a)         The
Purchaser may, at the Purchaser’s option, at any time while any Principal Amount remains outstanding, and so long as the
Conversion Amount (as defined below) is equal to or greater than the lesser of: (i) $4,000,000, and (ii) the then-outstanding Principal
Amount; convert the then-outstanding Principal Amount or any portion thereof (the “Conversion Amount”),
into the number of fully paid and non-assessable shares of Common Stock (the “Conversion Shares”) determined
by dividing the Conversion Amount by the Conversion Price then in effect. The Purchaser may exercise the right to convert all or
any portion of the Conversion Amount by delivering to the Company (A) a duly executed and completed notice of conversion in the
form attached to this Note as Exhibit A
(the “Notice of Conversion”), and (B) this Note. The business day on which a Notice of Conversion and
this Note are delivered to the Company in accordance with the provisions hereof shall be deemed a “Conversion Date.”
The Company will cause the Company’s transfer agent to provide a book-entry statement evidencing the Conversion Shares issuable
upon such conversion of this Note to the Purchaser via electronic transmission or express courier within five (5) business days
after the Conversion Date. Whether such book-entry statement has been received by the Purchaser or not, the Purchaser shall be
deemed to be the rightful beneficial and record owner of the Conversion Shares as of the Conversion Date. No fractional shares
shall be issued upon conversion of this Note. The amount of any of the Conversion Amount which is less than a whole share of Common
Stock shall be paid to the Purchaser in cash at a rate equal to the Conversion Price. Any delay due to such circumstance shall
not be an Event of Default under this Note.

 

(b)         The
Principal Amount, and any accrued interest thereon, shall be reduced by the Principal Amount indicated on the Notice of Conversion
and the corresponding interest paid with respect thereto in accordance with Section 2, upon the proper receipt by the Purchaser
of the Conversion Shares and the corresponding interest paid with respect thereto in accordance with Section 2, respectively,
due upon such Notice of Conversion.

 

(c)         The
Conversion Price shall be adjusted as follows:

 

(i)       If
the Company shall at any time after the Issuance Date subdivide its outstanding shares of Common Stock into a greater number of
shares of Common Stock, the Conversion Price in effect immediately prior to such subdivision shall be proportionately decreased,
and conversely, in case the outstanding shares of Common Stock shall be combined into a smaller number of shares of Common Stock,
the Conversion Price in effect immediately prior to such combination shall be proportionately increased.

 

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(ii)       If
the Company shall at any time or from time to time after the Issuance Date make, or fix a record date for the determination of
the holders of Common Stock entitled to receive, a dividend or other distribution payable in additional shares of Common Stock,
then and in each such event the Conversion Price shall be proportionately reduced; provided, however, that if such
record date is fixed and such dividend is not fully paid, or if such distribution is not fully made on the date fixed therefor,
the Conversion Price shall be recomputed to reflect that such dividend was not fully paid or that such distribution was not fully
made.

 

(d)         If
the Company at any time or from time to time after the Issuance Date makes, or fixes a record date for the determination of holders
of Common Stock entitled to receive, any dividend or distribution, whether of cash, assets in specie or other property (whenever
paid or made and however described), then and in each such event provision shall be made so that the Purchaser shall receive upon
exercise of the conversion right of this Note, in addition to the number of shares of Common Stock and the corresponding interest
receivable thereupon, the amount of such dividend or distribution of the Company which the Purchaser would have received had the
Conversion Amount of this Note been exercised on the date of such event and had it thereafter, during the period from the date
of such event to and including the date of conversion or purchase, retained such securities receivable during such period.

 

(e)         If
the Common Stock issuable upon the conversion of this Note is changed into the same or a different number of shares of any class
or classes of stock, whether by recapitalization, reclassification or otherwise (other than a transaction described elsewhere in
this Section 6), then, and in any such event, the Purchaser shall have the right thereafter, upon conversion of this Note
or purchase the kind and amount of stock and other securities and property receivable upon such reorganization or other change,
in an amount equal to the amount that the Purchaser would have been entitled to had it immediately prior to such reorganization,
reclassification or change converted this Note, but only to the extent this Note is actually converted, all subject to further
adjustment as provided herein.

 

7.           Waiver
and Amendment. The Purchaser hereby appoints and authorizes any combination of the Purchasers (as defined in the Securities
Purchase Agreement, but excluding any affiliate of the Company for purposes of this Section 7 only) who, collectively, represent
a majority of the outstanding principal under all of the Notes (together, the “Requisite Purchasers”)
to take all actions and exercise all rights on the Purchaser’s behalf under this Note, including the right to amend, waive
or modify any provisions of this Note, in the sole and absolute discretion of the Requisite Purchasers, without the requirement
of receiving consent from the Purchaser, but with the requirement of delivering written notice to the Company in accordance with
the provisions of Section 14 at least five (5) days prior to the taking of any such action or the exercise of any such right,
except that the Requisite Purchasers shall not, without the Purchaser’s prior written consent exercise any such right as
to the Purchaser unless the exercise thereof applies equally to all of the Purchasers in the same relative fashion. The Purchaser
acknowledges that by the operation of this Section 7, and subject to the limitations set forth in this Section 7,
the Requisite Purchasers shall have the right and power to diminish or eliminate certain rights of the Purchaser under this Note.
Any provision of this Note may also be amended, waived or modified upon the mutual written consent of the Company and the Purchaser.
In any case, no amendment, waiver or modification in any one instance shall be construed to be a continuing waiver or a waiver
in any other instance unless it expressly so provides.

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8.           No
Rights as a Stockholder. This Note does not by itself entitle the Purchaser to any voting rights or other rights as a stockholder
of the Company. In the absence of conversion of this Note, no provisions of this Note, and no enumeration herein of the rights
or privileges of the Purchaser, shall cause the Purchaser to be a stockholder of the Company for any purpose.

 

9.           Governing
Law. This Note shall be construed under the laws of the State of California, without regard to principles of conflicts
of law or choice of law that would permit or require the application of the laws of another jurisdiction. All actions or proceedings
arising directly or indirectly from or in connection this Note shall be resolved in accordance with Section 10 of the Securities
Purchase Agreement, as may be amended or restated from time to time.

 

10.         Successors
and Assigns. Subject to the restrictions on transfer and assignment described in Section 11 and Section 12,
the rights and obligations of the Company and the Purchaser shall be binding upon and inure to the benefit of the parties and their
respective successors and assigns.

 

11.         Transfer
of this Note or Securities Issuable on Conversion Hereof. With respect to any offer, sale or other disposition of this
Note or securities into which such Note may be converted, the Purchaser will give written notice to the Company prior thereto,
describing briefly the manner thereof, together with a written opinion of the Purchaser’s counsel, or other evidence if reasonably
satisfactory to the Company, to the effect that such offer, sale or other distribution may be effected without registration or
qualification (under any federal or state law then in effect). Upon receiving such written notice and reasonably satisfactory opinion,
or other evidence, if so requested, the Company, as promptly as practicable, shall notify the Purchaser in writing that the Purchaser
may sell or otherwise dispose of this Note or such securities, all in accordance with the terms of the notice delivered to the
Company. If a determination has been made pursuant to this Section 11 that the opinion of counsel for the Purchaser, or
other evidence, is not reasonably satisfactory to the Company, the Company shall so notify the Purchaser promptly in writing after
such determination has been made. Each Note thus transferred and each certificate representing the securities thus transferred
shall bear a legend as to the applicable restrictions on transferability in order to ensure compliance with the Securities Act,
unless in the opinion of counsel for the Company such legend is not required in order to ensure compliance with the Securities
Act. The Company may, if so required under the Securities Act, issue stop-transfer instructions to its transfer agent in connection
with such restrictions. Subject to the foregoing, transfers of this Note shall be registered upon registration books maintained
for such purpose by or on behalf of the Company as provided in the Securities Purchase Agreement. Prior to presentation of this
Note for registration of transfer, the Company shall treat the registered holder hereof as the owner and holder of this Note for
the purpose of receiving all payments of principal and interest hereon and for all other purposes whatsoever, whether or not this
Note shall be overdue and the Company shall not be affected by notice to the contrary.

 

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12.         Registration;
Book-Entry. The Company shall maintain a register (the “Register”) for the recordation of the
names and addresses of the holders of each Note and the Principal Amount of the Notes held by such holders (the “Registered
Notes”). The entries in the Register shall be conclusive and binding for all purposes absent manifest error, and
to that extent the Company and the holders of the Notes shall treat each person whose name is recorded in the Register as the owner
of a Note for all purposes, including, without limitation, the right to receive payments of the Principal Amount and interest,
if any, hereunder, notwithstanding notice to the contrary. A Registered Note may be assigned or sold in whole or in part only in
accordance with the terms of Section 11and by registration of such assignment or sale on the Register.

 

13.         Assignment
by the Company. The rights, interests or obligations hereunder may not be assigned, by operation of law or otherwise, in
whole or in part, by the Company without the prior written consent of the Requisite Purchasers.

 

14.         Notices.
Any notices, consents, waivers or other communications required or permitted to be given under the terms of this Note shall
be given in accordance with Section 16 of the Securities Purchase Agreement, as may be amended or restated from time to time.

 

15.         Right
of First Refusal.

 

(a)         So
long as the aggregate principal amount of all outstanding Notes is at least $50,000,000, if the Company proposes to issue and sell
New Securities for bona fide capital raising purposes, the Company shall give each of the Purchasers holding Notes written notice
of its intention, describing the price and the terms and conditions upon which the Company proposes to issue the New Securities.
Each Purchaser shall have 10 business days from the giving of such notice to agree to purchase its pro rata share of the
New Securities (based on the ratio of the principal amount of all Notes then held by such Purchaser to the aggregate principal
amount of all then-outstanding Notes) for the price and upon the terms and conditions specified in the notice by giving written
notice to the Company and stating therein the amount of New Securities to be purchased by such Purchaser.

 

(b)         If
not all of the Purchasers elect to loan to the Company their pro rata share of the New Securities, then the Company shall
promptly notify in writing the Purchasers who do so elect (the “Electing Purchasers”) and shall offer
each such Electing Purchaser the right to purchase such unsubscribed New Securities. Each of the Electing Purchasers shall have
five days after receipt of such notice to notify the Company of its election to purchase all or a portion of the unsubscribed New
Securities.

 

(c)         The
Company may, during the 180 days thereafter, sell the New Securities in respect of which the Purchasers’ rights were not
exercised, at a price not lower and upon general terms and conditions not materially more favorable to the purchasers thereof than
specified in the Company’s notice to the Purchasers pursuant to Section 15(a).

 

(d)         Notwithstanding
anything to the contrary in this Section 15, the Company shall not be required to offer or to sell any New Securities to
any Purchaser who would cause the Company to be in violation of applicable laws by virtue of such offer or sale.

 

16.         Restrictive
Covenants. The Company covenants and agrees that, so long as the aggregate principal amount of all outstanding Notes is
at least $25,000,000, it shall not, without the prior written consent of the Requisite Purchasers:

 

    	 	9	 

     

    

(a)          incur
any additional Indebtedness, except for additional Indebtedness in an aggregate principal amount of up to $50,000,000 in any calendar
year commencing with the calendar year ending December 31, 2018;

 

(b)         declare
or pay any cash dividend or make a cash distribution on any of its capital stock; provided, however, that this provision
shall not apply to the repurchase of Common Stock from employees, officers, directors, consultants or other persons performing
services for the Company or any subsidiary of the Company pursuant to agreements under which the Company has the option to repurchase
such shares at no greater than cost upon the occurrence of certain events, such as the termination of employment or service;

 

(c)          sell,
assign, transfer, convey or otherwise dispose of all or substantially all of the Company’s assets; or

 

(d)          alter
or change the rights, preferences or privileges of the Notes as a class.

 

17.         Pari
Passu Notes. The Notes constitute direct, unconditional and unsecured obligations of the Company and will at all times
rank pari passu and without any preference or priority among themselves and with all other present and future direct, unconditional
and unsecured debt obligations of the Company. The Purchaser acknowledges and agrees that the payment of all or any portion of
the outstanding Principal Amount and all interest hereon shall be pari passu in right of payment and in all other respects
to the other Notes issued pursuant to the Securities Purchase Agreement or pursuant to the terms of such Notes. In the event the
Purchaser receives payments in excess of the Purchaser’s pro rata share of the Company’s payments to the Purchasers
of all of the Notes, then the Purchaser shall hold in trust all such excess payments for the benefit of the holders of the other
Notes and shall pay such amounts held in trust to such other holders upon demand by such holders.

 

18.         Replacement
of Note. Upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction, or mutilation
of this Note and of indemnity satisfactory to it, and upon surrender and cancellation of this Note, the Company will make and deliver
a new Note of like tenor in lieu of this Note.

 

19.         Payment;
Currency. Payment shall be made in lawful tender of the United States. All references to “$” contained in this
Note shall refer to United States Dollars unless otherwise stated.

 

20.         Usury.
In the event any interest is paid on this Note which is deemed to be in excess of the then legal maximum rate, then that portion
of the interest payment representing an amount in excess of the then legal maximum rate shall be deemed a payment of principal
and applied against the principal of this Note.

 

21.         Expenses;
Waivers. If action is instituted to collect this Note, the Company promises to pay all costs and expenses, including, without
limitation, reasonable attorneys’ fees and costs, incurred in connection with such action. The Company hereby waives notice
of default, presentment or demand for payment, protest or notice of nonpayment or dishonor and all other notices or demands relative
to this instrument.

 

    	 	10	 

     

    

IN WITNESS WHEREOF, the Company has caused
this Convertible Promissory Note to be issued as of the date first written above.

 

	 	SORRENTO THERAPEUTICS, INC.
	 	 
	 	By: 	                                         
	 	Name: Henry Ji, Ph.D.
	 	Title: Chairman of the Board, President and Chief Executive Officer

 

[Signature Page to Convertible Promissory
Note]

 

     

     

    

EXHIBIT A

 

NOTICE OF CONVERSION

 

Reference is made to
that certain Convertible Promissory Note dated December 21, 2017 (as may be amended or restated from time to time, the
“Note”) in the original principal amount of $10,000,000 issued to the undersigned by Sorrento
Therapeutics, Inc., a Delaware corporation (the “Company”). Capitalized terms used herein and not
otherwise defined herein shall have the meanings assigned to them in the Note.

 

Pursuant to Section 6 of
the Note, the undersigned hereby irrevocably elects to convert $______________ in Principal Amount of the Note outstanding on the
date hereof into shares of Common Stock (“Conversion Shares”) at the Conversion Price in effect on the
date hereof and on the terms and subject to the conditions set forth in Section 6 of the Note.

 

All accrued but unpaid
interest on the Principal Amount of the Note being converted as specified in the previous paragraph shall be paid in cash in accordance
with Section 2 of the Note.

 

If the Conversion Shares
are to be issued in the name of a Person other than the undersigned, the undersigned will pay all transfer taxes payable with respect
thereto. No fee will be charged to undersigned for any conversion except as provided herein.

 

	 	Name of Purchaser: __________________________________
	 	 
	 	By: _______________________________________________
	 	 
	 	Name: ____________________________________________
	 	 
	 	Title: ______________________________________________
	 	 
	 	Date: ______________________________________________
	 	 
	 	Address to which certificates representing Conversion Shares and check for accrued but unpaid interest should be delivered:
	 	 
	 	_______________________________________________
	 	 
	 	_______________________________________________
	 	 
	 	_______________________________________________Exhibit 4.2

 

THE SECURITIES REPRESENTED
HEREBY AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933,
AS AMENDED (THE “SECURITIES ACT”), OR APPLICABLE STATE SECURITIES LAWS AND MAY BE OFFERED, SOLD, ASSIGNED, PLEDGED,
HYPOTHECATED, TRANSFERRED OR OTHERWISE DISPOSED OF (EACH, A “TRANSFER”) ONLY IF SUCH SECURITIES ARE REGISTERED UNDER
THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR IF SUCH TRANSFER IS MADE PURSUANT TO AN EXEMPTION FROM REGISTRATION
UNDER THE SECURITIES ACT AND SUCH STATE SECURITIES LAWS AFTER PROVIDING AN OPINION OF COUNSEL TO SUCH EFFECT.

 

THE SECURITIES REPRESENTED
HEREBY AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE, AS SET FORTH
IN A SECURITIES PURCHASE AGREEMENT BETWEEN THE COMPANY AND THE ORIGINAL HOLDER OF THESE SECURITIES, A COPY OF WHICH MAY BE OBTAINED
AT THE PRINCIPAL OFFICE OF THE COMPANY.

 

COMMON STOCK PURCHASE WARRANT

 

SORRENTO
THERAPEUTICS, INC.

 

	Warrant Shares: 2,424,242	Initial Issuance Date: December 21, 2017

 

THIS COMMON STOCK
PURCHASE WARRANT (this “Warrant”) certifies that, for value received, _____________________ or
its assigns (the “Holder”) is entitled, upon the terms and subject to the limitations on exercise
and the conditions hereinafter set forth, at any time and from time to time on or after June 20, 2018 (the
“Initial Exercise Date”) and on or prior to the close of business on June 21, 2023 (the
“Termination Date”) but not thereafter, to subscribe for and purchase from Sorrento Therapeutics,
Inc., a Delaware corporation (the “Company”), up to 2,424,242 shares of Common Stock (as subject to
adjustment hereunder, the “Warrant Shares”). The purchase price of one share of Common Stock under
this Warrant shall be equal to the Exercise Price (as defined below).

 

Section 1.            Definitions.
Capitalized terms used and not otherwise defined herein shall have the meanings set forth in that certain Securities Purchase Agreement
(as may be amended or restated from time to time, the “Purchase Agreement”), dated December 11, 2017,
by and among the Company and the purchasers identified on Schedule A thereto.
For purposes of this Warrant, the following capitalized terms have the meanings assigned to them in this Section 1.

 

a)          “Business
Day” means any day except a Saturday, a Sunday or any other day on which commercial banks are required or authorized
to close in the City of New York, State of New York or the City of San Diego, State of California.

 

    	 	1	 

     

    

 

b)          “Change
of Control” means the occurrence of any of the following events: (i) any “person” (as such term is used
in Sections 13(d) and 14(d) of the Exchange Act) becomes the “beneficial owner” (as defined in Rule 13d-3 of the Exchange
Act), directly or indirectly, of securities of the Company representing 50% or more of the total voting power represented by the
Company’s then-outstanding voting securities, except that any change in the beneficial ownership of the securities of the
Company as a result of a private financing of the Company that is approved by the Company’s board of directors, shall not
be deemed to be a Change of Control; (ii) the consummation of the sale, lease, license or disposition by the Company of all or
substantially all of the Company’s assets; or (iii) the consummation of a merger or consolidation of the Company with any
other corporation, other than a merger or consolidation which would result in the voting securities of the Company outstanding
immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities
of the surviving entity or its parent) at least 50% of the total voting power represented by the voting securities of the Company
or such surviving entity or its parent outstanding immediately after such merger or consolidation.

 

c)          “Closing
Bid Price” means, for any date, the price determined by the first of the following clauses that applies: (i) if the
Common Stock is then listed or quoted on a Trading Market, the last reported closing bid price for such date on the Trading Market
on which the Common Stock is then listed or quoted as reported by Bloomberg L.P., (ii) if the Common Stock is not then listed on
a Trading Market or quoted for trading on the OTC Bulletin Board and if prices for the Common Stock are then reported in the “Pink
Sheets” published by OTC Markets Group Inc. (or a similar organization or agency succeeding to its functions of reporting
prices), the last bid price per share of the Common Stock so reported, or (iii) in all other cases, the fair market value
of a share of Common Stock as determined by an independent appraiser selected in good faith by the Company and reasonably acceptable
to the Holder, the fees and expenses of which shall be paid by the Company.

 

d)          “Trading
Day” means a day on which the Common Stock
is traded on a Trading Market or, if the Common Stock is not traded on a Trading Market, then on the principal securities exchange
or securities market on which the Common Stock is then traded.

 

e)          “Trading
Market” means any market or exchange of The NASDAQ Stock Market LLC or the
New York Stock Exchange.

 

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

 

    	 	2	 

     

    

 

Section 2.            Exercise.

 

a)          Exercise
of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times on or after the Initial
Exercise Date and on or before the Termination Date by delivery to the principal office of the Company (or such other office or
agency of the Company as it may designate by notice in writing to the registered Holder at the address of the Holder appearing
on the books of the Company) of a duly executed facsimile or original copy of the Notice of Exercise Form annexed hereto (each,
a “Notice of Exercise”). Unless being exercised on a cashless basis in accordance with Section 2(c),
within three Trading Days following the date of exercise as aforesaid, the Holder shall deliver the aggregate Exercise Price for
the shares specified in the applicable Notice of Exercise by wire transfer or cashier’s check drawn on a United States bank.
Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company
until the Holder has purchased all of the Warrant Shares available hereunder and this Warrant has been exercised in full, in which
case, the Holder shall surrender this Warrant to the Company for cancellation within three Trading Days of the date the final Notice
of Exercise is delivered to the Company. Partial exercises of this Warrant resulting in purchases of a portion of the total number
of Warrant Shares available hereunder shall have the effect of lowering the outstanding number of Warrant Shares purchasable hereunder
in an amount equal to the applicable number of Warrant Shares purchased. The Holder and the Company shall maintain records showing
the number of Warrant Shares purchased and the date of such purchases. The Company shall inform the Holder if a Notice of Exercise
has not been duly completed within one Business Day of receipt of such notice, but shall not refuse or object to the issuance of
the Warrant Shares upon receipt of, and pursuant to, a duly completed Notice of Exercise. The Holder and any assignee, by acceptance
of this Warrant, acknowledge and agree that, by reason of the provisions of this paragraph, following the purchase of a portion
of the Warrant Shares hereunder, the number of Warrant Shares available for purchase hereunder at any given time may be less than
the amount stated on the face hereof.

 

b)          Exercise
Price. The exercise price per share of the Common Stock under this Warrant shall be $2.61, subject to adjustment hereunder
(the “Exercise Price”).

 

c)          Cashless
Exercise. If at the time of exercise of this Warrant there is no effective registration statement registering the resale of
the Warrant Shares by the Holder, the Holder, at its option, may exercise this Warrant, in whole or in part, by means of a “cashless
exercise” in which the Holder shall be entitled to receive a certificate for the number of Warrant Shares equal to the quotient
obtained by dividing [(Y)*(A-B)] by (A), where:

 

(A) = the
average of the Closing Bid Price of the shares of Common Stock for the five consecutive Trading Days ending on the last Trading
Day immediately preceding the date on which the Holder elects to exercise this Warrant by means of a “cashless exercise,”
as set forth in the applicable Notice of Exercise;

 

    	 	3	 

     

    

 

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

 

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

 

d)          Mechanics
of Exercise.

 

i.         Delivery
of Certificates Upon Exercise. Certificates for shares purchased hereunder shall be transmitted by the Company’s transfer
agent (the “Transfer Agent”) to the Holder by crediting the account of the Holder’s prime broker
with The Depository Trust Company through its Deposit or Withdrawal at Custodian system (“DWAC”) if the
Company is then a participant in such system and there is an effective registration statement permitting the issuance of the Warrant
Shares to or resale of the Warrant Shares by the Holder, or otherwise by physical delivery to the address specified by the Holder
in the Notice of Exercise by the date that is three Trading Days after the latest of (A) the delivery to the Company of the Notice
of Exercise, (B) surrender of this Warrant (if required), and (C) payment of the aggregate Exercise Price as set forth above, including
by means of a “cashless exercise” (such date, the “Warrant Share Delivery Date”). The Warrant
Shares shall be deemed to have been issued, and the Holder or any other person so designated to be named therein shall be deemed
to have become a holder of record of such shares for all purposes, as of the date this Warrant has been exercised, with payment
to the Company of the Exercise Price and all taxes required to be paid by the Holder, if any, pursuant to Section 2(d)(v)
prior to the issuance of such shares, having been paid. 

 

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

 

iii.       Rescission
Rights. If the Company fails to cause the Transfer Agent to transmit to the Holder a certificate or the certificates representing
the Warrant Shares pursuant to Section 2(d)(i) by the Warrant Share Delivery Date, then the Holder will have the right to
rescind such exercise. Any rescission by the Holder pursuant to this Section 2(d)(iii) shall not affect any other remedies available
to the Holder under Laws or equity as a result of the Company’s failure to timely deliver the Warrant Shares.

 

    	 	4	 

     

    

 

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

 

v.       Charges,
Taxes and Expenses. Issuance of certificates for Warrant Shares shall be made without charge to the Holder for any issue or
transfer tax or other incidental expense in respect of the issuance of such certificate, all of which taxes and expenses shall
be paid by the Company, and such certificates shall be issued in the name of the Holder or in such name or names as may be directed
by the Holder; provided, however, that in the event certificates for Warrant Shares are to be issued in a name other
than the name of the Holder, this Warrant when surrendered for exercise shall be accompanied by the Assignment Form attached hereto
duly executed by the Holder, and the Company may require, as a condition thereto, the payment of a sum sufficient to reimburse
it for any transfer tax incidental thereto.

 

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

 

Section 3.            Certain
Adjustments.

 

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

 

    	 	5	 

     

    

 

b)          Pro
Rata Distributions. If the Company, at any time while this Warrant is outstanding, shall distribute to all holders of Common
Stock (and not to the Holder) evidences of its indebtedness or assets (including cash and cash dividends) or rights or warrants
to subscribe for or purchase any security, then in each such case the Exercise Price shall be adjusted by multiplying the Exercise
Price in effect immediately prior to the record date fixed for determination of stockholders entitled to receive such distribution
by a fraction of which the numerator shall be such VWAP on such record date less the then per share fair market value at such record
date of the portion of such assets or evidence of indebtedness so distributed applicable to one outstanding share of Common Stock
as determined by the Board of Directors of the Company in good faith, and of which the denominator shall be the VWAP determined
as of the record date mentioned above. In either case the adjustments shall be described in a statement provided to the Holder
of the portion of assets or evidences of indebtedness so distributed or such subscription rights applicable to one share of Common
Stock. Such adjustment shall be made whenever any such distribution is made and shall become effective immediately after the record
date mentioned above.

 

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

 

d)          Notice
to the Holder.

 

i.         Adjustment
to Exercise Price. Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the Company
shall, at the request of the Holder, promptly compute such adjustment, in good faith, in accordance with the terms of this Warrant,
and prepare a certificate setting forth such adjustment, including a statement of the adjusted Exercise Price and adjusted number
or type of Warrant Shares or other securities issuable upon exercise of this Warrant (as applicable) and setting forth a brief
statement of the facts requiring such adjustment. Upon written request, the Company will promptly deliver a copy of each such certificate
to the Holder.

 

    	 	6	 

     

    

 

ii.        Notice
to Allow Exercise by the Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever form) on
the Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common Stock, (C)
the Company shall authorize the granting to all holders of the Common Stock or rights or warrants to subscribe for or purchase
any shares of capital stock of any class or of any rights of the Company, (D) a Change of Control is pending, or (E) the Company
shall authorize the voluntary or involuntary dissolution, liquidation or winding up of the affairs of the Company, then, in each
case, the Company shall cause to be mailed to the Holder at its last address as it shall appear upon the Warrant Register (as defined
below) of the Company, at least 20 calendar days prior to the applicable record or effective date hereinafter specified, a notice
stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants,
or if a record is not to be taken, the date as of which the holders of the Common Stock of record to be entitled to such dividend,
distribution, redemption, rights or warrants are to be determined, or (y) the date on which such Change of Control is expected
to become effective or close, and the date as of which it is expected that holders of the Common Stock of record shall be entitled
to exchange their shares of Common Stock for securities, cash or other property deliverable upon such Change of Control; provided
that the failure to mail such notice or any defect therein or in the mailing thereof shall not affect the validity of the corporate
action required to be specified in such notice. The Holder shall remain entitled to exercise this Warrant during the period commencing
on the date of such notice to the effective date of the event triggering such notice except as may otherwise be expressly set forth
herein. Except as otherwise prohibited by applicable laws, to the extent that any notice provided pursuant to this Section 3(d)(ii)
contains material, non-public information regarding the Company, the Company shall, disclose such information regarding the Company
in a Current Report on Form 8-K and file such Current Report on Form 8-K with the SEC no later than the second Trading Day following
the date such notice is delivered to the Holder.

 

Section 4.            Transfer
of Warrant.

 

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

 

    	 	7	 

     

    

 

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

 

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

 

Section 5.            Warrant
Agent. The Company shall serve as warrant agent under this Warrant. Upon 15 days’ notice to the Holder, the Company may
appoint a new warrant agent. Any corporation into which the Company or any new warrant agent may be merged or any corporation resulting
from any consolidation to which the Company or any new warrant agent shall be a party or any corporation to which the Company or
any new warrant agent transfers substantially all of its corporate trust or stockholders services business shall be a successor
warrant agent under this Warrant without any further act. Any such successor warrant agent shall promptly cause notice of its succession
as warrant agent to be mailed (by first class mail, postage prepaid) to the Holder at the Holder’s last address as it shall
appear upon the Warrant Register.

 

Section 6.            Miscellaneous.

 

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

 

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

 

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

 

    	 	8	 

     

    

 

d)          Authorized
Shares.

 

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

 

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

 

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

 

e)          Governing
Law. This Warrant shall be construed under the laws of the State of California, without regard to principles of conflicts of
law or choice of law that would permit or require the application of the laws of another jurisdiction. All actions or proceedings
arising directly or indirectly from or in connection this Warrant shall be resolved in accordance with Section 10 of the Purchase
Agreement, as may be amended or restated from time to time.

 

    	 	9	 

     

    

 

f)           Restrictions.
The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant constitute “restricted securities”
within the meaning of Rule 144 under the Securities Act and may not be sold, pledged or otherwise disposed of unless they are subsequently
registered under the Securities Act and applicable state securities laws or unless an exemption from registration thereunder is
available.

 

g)          Fees
and Expenses. Except as otherwise provided in this Warrant, all expenses incurred in connection with this Warrant and the transactions
contemplated hereby shall be paid by the party incurring such expenses.

 

h)          Notices.
Any notices, consents, waivers or other communications required or permitted to be given under the terms of this Warrant shall
be given in accordance with Section 16 of the Purchase Agreement, as may be amended or restated from time to time.

 

i)           Limitation
of Liability. No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant to purchase
Warrant Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of the Holder
for the purchase price of any Common Stock or as a stockholder of the Company, whether such liability is asserted by the Company
or by creditors of the Company.

 

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

 

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

 

l)           Amendment.
No provision of this Warrant may be amended, waived or modified other than by an instrument in writing signed by the Company and
the Holder.

 

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

 

n)          Headings.
The headings of this Warrant are for convenience of reference and shall not form part of, or effect the interpretation of, this
Warrant.

 

    	 	10	 

     

    

 

o)          Language;
Currency. This Warrant has been prepared in the English language and the English language shall control its interpretation.
In addition, all notices required or permitted to be given hereunder, and all written, electronic, oral or other communications
between the parties regarding this Warrant, shall be in the English language. All references to “$” contained in this
Warrant shall refer to United States Dollars unless otherwise stated.

 

********************

 

(Signature Page Follows)

 

    	 	11	 

     

    

 

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

 

	 	
        SORRENTO THERAPEUTICS,
        INC.

         

	 	 
	 	By:	 
	 	 	Name: Henry Ji, Ph.D.
	 	 	Title: President and Chief Executive Officer

 

[Signature Page to Common Stock Purchase
Warrant]

 

     

     

    

 

NOTICE OF EXERCISE

 

To:          SORRENTO
THERAPEUTICS, inc.

 

(1)           The
undersigned hereby elects to purchase ________ Warrant Shares of the Company pursuant to the terms of the attached Common Stock
Purchase Warrant (the “Warrant”), and tenders herewith payment of the applicable exercise price, together
with all applicable transfer taxes, if any.

 

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

 

 ̈ in lawful money
of the United States; or

 

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

 

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

 

_______________________________

 

The Warrant Shares shall be delivered to the
following DWAC Account Number or by physical delivery of a certificate to:

 

_______________________________

 

_______________________________

 

_______________________________

 

[SIGNATURE
OF HOLDER]

 

Name of Investing Entity: ________________________________________________________

Signature of Authorized Signatory of Investing
Entity: __________________________________

Name of Authorized Signatory: ___________________________________________________

Title of Authorized Signatory: _____________________________________________________

Date: _________________________________________________________________________

 

     

     

    

 

ASSIGNMENT FORM

 

(To assign the foregoing warrant, execute

this form and supply required information.

Do not use this form to exercise the warrant.)

 

FOR VALUE RECEIVED, all
of or [_______] of the shares of the foregoing Common Stock Purchase Warrant (the “Warrant”) and all
rights evidenced thereby are hereby assigned to

 

_______________________________________________
whose address is

 

_______________________________________________________________.

 

_______________________________________________________________

 

	 	 	Dated: ______________, _______
	 	 	 
	 	Holder’s Signature:	_____________________________
	 	 	 
	 	Holder’s Address:	_____________________________
	 	 	 
	 	 	_____________________________

 

Signature Guaranteed: ___________________________________________

 

NOTE: The signature to this Assignment Form
must correspond with the name as it appears on the face of the Warrant, without alteration or enlargement or any change whatsoever,
and must be guaranteed by a bank or trust company. Officers of corporations and those acting in a fiduciary or other representative
capacity should file proper evidence of authority to assign the Warrant.

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