Document:

EX-10.20

 Exhibit 10.20 

[***] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED. 
 COMMERCIAL FILL/FINISH SERVICES AGREEMENT

 This COMMERCIAL FILL/FINISH SERVICES AGREEMENT (the
“Agreement”) is entered into as of the 19th day of December, 2014 (“Effective Date”) by and between AVEDRO, Inc.
(“Clients”), and AJINOMOTO ALTHEA, INC., a Delaware corporation, with a place of business located at 11040 Roselle Street, San Diego, CA 92121
(“Althea”); 
 WHEREAS Client has Bulk Compound (capitalized terms are defined below) for filling and/or
finishing; 
 WHEREAS Althea has the expertise and the fill/finish facility suitable for the Production of Client Product; and 

WHEREAS, Client wishes to have Althea perform such services, and Althea wishes to perform such services for Client. 

NOW, THEREFORE, in consideration of the premises and the undertakings, terms, conditions and covenants set forth below, the parties
hereto agree as follows: 
 1. DEFINITIONS. 

1.1 “Affiliate” of a party hereto shall mean any entity that controls or is controlled by such party, or is under
common control with such party. For purposes of this definition, an entity shall be deemed to control another entity if it owns or controls, directly or indirectly, at least 50% of the voting equity of another entity (or other comparable interest
for an entity other than a corporation). 
 1.2 “Althea SOPs” shall mean Althea’s Standard Operating Procedures,
which will be customized on a product specific basis, as necessary, for manufacture of Client Product. Client will review and approve each product specific SOP prior to production of Client Product and any subsequent revisions to these
product-specific SOPs. 
 1.3 “Batch” shall mean a specific quantity of Client Product mutually agreed upon between
Client and Althea, and that (a) is intended to have uniform character and quality within specified limits, and (b) is Produced according to a single manufacturing order during the same cycle of manufacture. 

1.4 “Bulk Compound” shall mean the bulk drug or active pharmaceutical ingredient of Client Product, in bulk form,
supplied by Client. 
 1.5 “cGMP” shall mean current Good Manufacturing Practices as defined in the FDA rules and
regulations, 21 CFR Parts 210-211. 
 1.6 “Cancellation Fees” shall mean the
cancellation fees payable by Client under section 3.4. 
 1.7 “Certificate of Analysis” shall mean a certificate of
analysis that certifies that a Batch meets the release Specifications. 

  

					
		  	1.	  	

 1.8 “Client Product” shall mean the pharmaceutical product(s) to be
Produced by Althea in finished dosage form under this Agreement as identified on Appendix B hereto, which Appendix may be updated by mutual agreement of the parties from time to time during the Term.. 

1.9 “Components” shall mean all components used by Althea in Production of Client Product under this Agreement.
Components shall be listed in the SOW, and are identified as Components supplied by Client or its vendors, including any Bulk Compound (“Client Supplied Components”) and Components supplied by Althea or its vendors
(“Althea Supplied Components”). 
 1.10 “Confidential Information” shall have the meaning set
forth in Section 9.1. 
 1.11 “Facility” shall mean Althea’s facility located at 11040 Roselle Street, San
Diego, CA 92121. 
 1.12 “FDA” shall mean the United States Food and Drug Administration or any successor entity
thereto. 
 1.13 “Invention” shall mean any creative work, invention, innovation, improvement, development,
discovery, trade secret, method, know-how, process, technique or the like, whether or not written or otherwise fixed in any form or medium, regardless of the media on which contained, and whether or not
patentable or copyrightable. 
 1.14 “Intellectual Property” shall mean all rights, privileges and priorities
provided under applicable international, national, federal, state or local law, rule, regulation, statute, ordinance, order, judgment, decree, permit, franchise, license, or other government restriction or requirement of any kind relating to
intellectual property, whether registered or unregistered, in any country, including without limitation: (a) all (i) patents and patent applications (including any patent that in the future may issue in connection therewith and all divisions,
continuations, continuations-in-part, extensions, additions, registrations, confirmations, reexaminations, supplementary protection certificates, renewals or reissues
thereto or thereof), (ii) copyrights and copyrightable works, including reports, software, databases and related items, and (iii) trademarks, service marks, trade names, brand names, product names, corporate names, logos and trade dress, the
goodwill of any business symbolized thereby, and all common-law rights relating thereto; and (b) all registrations, applications, recordings, rights of enforcement, rights of recovery based on past
infringement and any and all claims of action related thereto and licenses or other similar agreements related to the foregoing. 
 1.15
“Labeling” shall mean all labels and other written, printed, or graphic matter upon: (i) Client Product or any container, carton, or wrapper utilized with Client Product or (ii) any written material accompanying Client
Product. 
 1.16 “Master Batch Record” or “MBR” shall mean the formal set of written instructions
for Production of Client Product, approved in writing by both parties. The MBR shall be developed and maintained in Althea’s standard format by Althea, using Client’s master formula and technical support. 

1.17 “Production” or “Produce” shall mean all steps and activities necessary to produce Client Product
to be performed by Althea as set forth in the SOW, including, without limitation and as applicable, the filling, packaging, inspection, Labeling, testing, quality control and release. 

  

					
		  	2.	  	        

 1.18 “Purchase Price” shall mean the amount(s) to be paid by Client
as specified in the SOW, subject to adjustment from time to time in accordance with section 2.11. 
 1.19 “Quality
Agreement” shall mean a written, mutually executed agreement between Althea and Client that defines the quality roles and responsibilities of each party in connection with Production of Client Product. 

1.20 “Regulatory Authority” shall mean any agency or authority responsible for regulation of Client Product in the
United States or any foreign regulatory jurisdiction provided that Althea shall have no obligation to Produce Client Product in compliance with the requirements of any non-U.S. Regulatory Authority,
except as expressly specified in the SOW 
 1.21 “Released Executed Batch Record” shall mean the completed batch
record and associated deviation reports, investigation reports, and Certificates of Analysis created for each Batch of Client Product, in the standard form used by Althea. 

1.22 “Specifications” shall mean the applicable specifications for Client Product or Components, as applicable, set
forth in the SOW and the MBR. 
 1.23 “Statement of Work” or “SOW” shall mean a written proposal or
similar document, when manually signed by both parties and made a part of this Agreement as Appendix A, which sets forth the particulars of Production and all other services to be provided under this Agreement, including without limitation, all
Specifications, Components, the Purchase Price, any timelines, milestones, payment schedules, technology transfer plans, and validation protocols. Any change to an SOW shall require a written change order manually signed by both parties in
accordance with sections 8.1 and 15.2. 
 1.24 “Term” shall have the meaning provided in Section 3.1. 

1.25 “Territory” means the United States of America and any other county that the parties agree in writing to add to
this definition of Territory in an amendment to this Agreement. 
 2. VALIDATION AND PRODUCTION. 

2.1 Validation. Althea shall validate equipment (as applicable) and the Production process according to the validation protocol(s)
approved by both parties in advance. Such validation protocol(s) and timeline shall be included in the SOW. Client shall pay Althea for validation services as set forth in the SOW. 

2.2 Documentation: The Master Batch Record shall be reviewed and approved by Althea and by Client in writing prior to commencement of
Production. Any material change to an approved Master Batch Record shall be reviewed and approved in a signed writing by Althea and by Client prior to said change being implemented. Each Batch of Client Product shall be Produced by using a copy of
the Master Batch Record. Each copy of the Master Batch Record for such Batch of Client Product shall be assigned a unique Batch number. Deviation(s) from the Master Batch Record must be documented as required by cGMP in the Released Executed Batch
Record for that Batch. Althea shall provide Client with the Released Executed Batch Record in a form reasonably suitable for Client’s submission to the FDA. The parties shall execute the Quality Agreement simultaneously with the execution of
this Agreement or at a later time if set forth in the SOW, provided that such Quality Agreement shall be executed prior to commencement of Production. 

  

					
		  	3.	  	        

 [***] = CONFIDENTIAL TREATMENT REQUESTED 

 

 2.3 Supply and Purchase of Product: During the Term and subject to each party’s
compliance with the terms of this Agreement Client will purchase from Althea, and Althea will Produce Client Product for the price, quantities and on the other terms and conditions set forth in the Firm Commitment and the SOW. 

2.4 Production, Forecasts & Orders: Althea shall commence Production of Client Product in accordance with and
pursuant to the timeline set forth in the SOW. Within [***] of the execution and delivery of this Agreement, Client shall provide a [***] forecast of the quantities of Client Product that Client intends to order from Althea in each month (the
“Forecast”) beginning with the date scheduled for commencement of Production. At the start of every [***], Client shall furnish to Althea a written [***] rolling forecast of the quantities of Product that Client intends to
order from Althea during such period (“Rolling Forecast”). Such forecasts shall be non-binding, provided however that if during any [***]. The [***] of such Rolling Forecast in respect
of the Product shall constitute a binding commitment for the quantities of such Product specified therein (“Firm Commitment”) and the remaining period of the Rolling Forecast shall be
non-binding, good faith estimates for information purposes only, provided that (a) the initial non-binding Forecast for any period shall subject to
acceptance of same by Althea and (b) Client shall not vary a subsequent Forecast for any [***] from the initial Forecast (increase or decrease) for [***] without Althea’s written consent. Althea shall have available manufacturing capacity
to supply Client with quantities of Product up to [***] of the first submitted Firm Commitment. 
 (a) On or about the [***] during
the Term, Client shall submit purchase orders which specify, at a minimum, the actual number of Batches to be Produced, the number of units in each Batch and the requested delivery date for each Batch. Such purchase orders shall be submitted at
least [***] prior to the first delivery date specified in the order, and shall become binding upon acceptance by Althea, provided that Althea may not reject any order other than as provided by the terms of this Agreement, including, in the event
Client is not in material compliance with any of its material payment obligations as contemplated by Section 2.12, and provided that the order is consistent with the most recent accepted Forecast, including the Firm Commitment. Production for
which any change order, Purchase Order or prepayment is not received or completed with at least the prescribed lead time, if agreed to by both parties, may incur an expediting fee of [***]. 

(b) In the event purchase orders do not provide a continuity of Production, Althea may require additional validation batches before
further Production, at the validation services rates set forth in the SOW. 
 (c) For clarity, the Firm Commitment is subject to
section 7.1. 
 2.5 Delays: Althea shall promptly notify Client in writing if it believes that there are likely to be substantial
changes in the work schedule contained in the SOW or the delivery date(s) in any purchase order. Such notice shall include the reasons for such changes in the schedule and the proposed new schedule for the incomplete portion of the work described in
the SOW or the purchase order. Subject to the provisions regarding Force Majeure below, the party responsible for delays in Production shall be determined as follows: 

(a) Client is responsible for delays to the extent due to delays or lack of delivery of reviews, approvals, critical information,
documents, (pre)payments or other items to be supplied by Client as set forth in the SOW. 

  

					
		  	4.	  	        

 [***] = CONFIDENTIAL TREATMENT REQUESTED 

 

 (b) Client is responsible for delays to the extent caused by delivery delays,
variation from Specifications or variable performance of Bulk Compound or other Client-Supplied Components as set forth in the SOW. 
 (c)
Client is responsible for delays to the extent due to its instructions or failure to follow the MBR or terms of this Agreement.. 

(d) Althea is responsible for delays to the extent due to its failure to properly maintain its Facility or systems; failure to provide
sufficient capacity required by a proper Forecast; Althea’s scheduling errors vis a vis a proper Forecast; or failure to provide sufficient personnel or staffing for capacity required as above; Althea’s failure to follow the MBR, SOPs or
other written and agreed processes for procurement, or release of Althea- Supplied Components; operational failures such as, but not limited to cleaning, to the extent caused by Althea’s failure to follow the MBR or SOPs. 

(e) Althea is responsible for delays to the extent due to its failure to follow the Master Batch Record or the terms of this Agreement.

 Without limiting the foregoing of this Section 2.5, the extent of a party’s responsibility shall take into consideration the duration of the
delay and the quantity of Client Product affected. The parties shall attempt to agree on resolution of such delay via good faith negotiations, subject to Section 15.8. 

2.6 Vendor and Supplier Audit and Certification: Client shall certify and audit all vendors and suppliers of Client-Supplied Components,
supply Althea with documentation of such audit results and certifications as Althea may reasonably request and, by signing the applicable SOW(s), shall be deemed to have approved Althea’s selection of vendors and suppliers of Althea Supplied
Components. 
 2.7 Delivery Terms: Althea shall ship all Client Product to Client or to Client’s designated consignee in
accordance with Client instructions received under section 2.10(b). All shipments shall be shipped [***] Althea’s Facility, by a common carrier mutually agreed, at Client’s expense. Title and risk of loss shall pass to Client as stated in
section 2.10(b). Client shall procure, at its cost, insurance covering damage or loss of Client Product and Client Supplied Components during all times for which it has risk of loss. All shipping instructions of Client shall be accompanied by the
name and address of the recipient and the shipping date. 
 2.8 Exporter of Record: Client shall be the exporter of record for any
Client Product shipped out of the United States, as Client remains the owner of the Client Product. Client warrants that all shipments of Client Product exported from the United States will be made in compliance with all applicable United States
export laws and regulations and all applicable import laws and regulations into the country of deportation. Client shall be responsible for obtaining and paying for any licenses, clearances or other governmental authorization(s) necessary for the
exportation from the United States. Client shall select and pay the freight forwarder who shall solely be Client’s agent. Client and its freight forwarder shall be solely responsible for preparing and filing the shipper’s export
declaration and any other documentation required for the export. 

  

					
		  	5.	  	        

 [***] = CONFIDENTIAL TREATMENT REQUESTED 

 

 2.9 Material Safety Data Sheet (MSDS); Acceptable Materials: Client shall provide
Althea a material safety data sheet for Bulk Compound or other Client-Supplied Components and Client Product and Althea shall conform to established safety practices and procedures set forth therein and shall store and handle Bulk Compound and
Client Product as required by the MBR and all applicable laws and regulations. Althea is under no obligation to produce, nor shall Client ship or cause to be shipped to Althea without specific prior written approval, any materials which:
(a) contain [***] or (b) have an Occupational Exposure Limit of less than [***]. Althea understands and agrees that the Bulk Compound may have unpredictable and unknown biological and/or chemical properties and should be used with caution
and are not to be used for testing in or treatment of humans. Althea shall immediately notify Client of any unusual health or environmental occurrence of which it has knowledge relating to Client Product, including, but not limited to any claim or
complaint by any employee of Althea or any of its Affiliates or third party contractors. Althea agrees to advise Client immediately of any safety or toxicity problems of which it becomes aware regarding the Client Product. Client shall ensure such
MSDSs are promptly updated as needed. 
 2.10 Deposits and Payment for Production; Rejected Material; Storage: 

(a) Unless otherwise stated therein, within 5 working days of receipt of an invoice following execution of any SOW, Client shall pay to
Althea prepayment amount set forth in such SOW. Unless otherwise stated therein, within [***] of execution of any SOW, Client shall pay to Althea prepayment amount set forth in such SOW. No Production, timeline, facility availability or milestone
dates shall be firm until confirmed by Althea at or immediately prior to the time such prepayment is received, and any delay in receipt of the prepayment may delay Production and timelines. Amounts due for Batches of Client Product hereunder will be
invoiced upon Althea’s release thereof. Client shall pay all invoices by wire in accordance with the instructions below within [***] of the invoice date. No tax or other withholding shall be made from payments due hereunder. Any payment due
under this Agreement not received within the times noted above shall bear interest at the lesser of (a) the maximum rate permitted by law, and (b) [***] on the outstanding balance [***]. 

Althea’s wire instructions are as follows: 

Beneficiary: Ajinomoto Althea, Inc. 

11040 Roselle Street 
 San Diego
CA 92121 
 [***] 
 (b)
Within [***] of Client’s receipt of Althea’s release documentation under section 5.1, Client shall notify Althea as to whether to return, retain or dispose of remaining Client Supplied Components, and shall provide shipping
instructions for Client Product. Title and risk of loss for Client Product shall pass to Client on the earlier of (i) expiration of such [***] period, (ii) release by Client or (iii) shipment of such materials to Client or its
designee. If Client does not provide for the shipping of Client Product or the return, retention or disposition of remaining Client Supplied Components within such [***] period, then Althea will begin assessing a storage fee for all such materials
at the price set forth in the SOW, or, if none, at Althea’s then current standard rates. Storage fees may also be assessed, beginning [***] after cessation or interruption of Production, for retained Client Supplied Components and Client
equipment. Storage may be at Althea’s or its qualified subcontractors’ storage facilities. If Althea is storing any of the foregoing items for Client, Althea may destroy such items at Client’s expense, upon [***] notice of intent to
destroy and opportunity to take delivery prior to the scheduled shipment for destruction. 

  

					
		  	6.	  	        

 [***] = CONFIDENTIAL TREATMENT REQUESTED 

 

 (c) The parties agree that the default handling of rejected Client Product or
tailings, including, without limitation, Rejected Products (“Rejects”) shall be destruction at Client’s expense, unless the rejection is due to a non-conformity giving rise to
Client’s remedies under section 5.2, in which case such destruction shall be at Althea’s expense. No storage of Rejects by Althea shall be required unless by mutual written agreement of the parties prior to the start of Production. Client
shall notify Althea in writing in advance of Production of any disposition instructions for Rejects, including any labeling and special conditions, which shall be binding if agreed by Althea and incorporated into the Master Batch Record. Such
instructions shall comply with cGMP and any other applicable laws and regulations. Client warrants that Rejects that are not destroyed per its instructions shall only be used in accordance with applicable law and regulations. Absent timely
disposition instructions as set forth above, Althea shall dispose of Rejects in accordance with Althea’s SOPs and applicable law. 

2.11 Purchase Price and Price Adjustments: The Purchase Price is firm from the Effective Date until December 31, 2015. Beginning
each January 1st thereafter during the Term of this Agreement, Althea shall have the right to adjust the Purchase Price once annually for processing, and other costs. For processing costs, Althea
Purchase Price increases may not exceed [***]. Althea shall provide at least [***] prior written notice to Client of any increase. Althea shall use commercially reasonable efforts to implement a price reduction program that targets the reduction of
the cost of manufacturing of the Client Product, including, without limitation, reduction in the cost of Althea-Supplied Components, and shall share the resulting cost savings with Client by means of appropriate price reductions as mutually agreed
by amendment to the SOW. Notwithstanding the foregoing, prices for raw materials shall reflect, on a pass-through basis, changes at any time caused by increases or decreases in cost of such raw materials, without regard to any price restrictions
stated herein. Althea will provide documentation for all raw material cost increases or decreases. 
 2.12 Default in Payment
Obligations: In addition to all other remedies available to Althea in the event of a Client default for payment, if Client fails to timely make payments (unless they are the subject of a good faith dispute lasting not more than [***]) as
required hereunder, any prepayments or other amounts owed to or held for Client hereunder shall be automatically applied to invoices more than [***] past due and Althea may refuse to accept future Purchase Orders or to Produce or deliver any Client
Product until Client’s account is paid in full, and/or the foregoing terms of payment are modified by mutual written agreement of the parties. Althea shall not be required to return any Client equipment or other property until Client has paid
all outstanding invoices (not including invoices that are subject to a good faith dispute during the [***] described above). 
 2.13
Returns: This Agreement does not include any third-party returns processing by Althea. 
 2.14 Subcontractors. Althea shall not
subcontract or otherwise delegate any of its obligations under this Agreement if Client reasonably objects to such subcontractor after notice provided under this paragraph, except that Althea may use independent contractors in the ordinary course of
business. In the event Althea appoints a sub-contractor to perform obligations hereunder in accordance with this Section 2.14, Althea shall remain responsible to Client for (a) the proper performance
of its obligations under the Agreement, and (b) all of its subcontractors’ activities and any and all failures by its subcontractors to comply with the terms of this Agreement. Althea shall notify Client following the appointment of any
such subcontractor within [***] of such appointment. 

  

					
		  	7.	  	        

 [***] = CONFIDENTIAL TREATMENT REQUESTED 

 

 3. TERM AND TERMINATION. 

3.1 Term: This Agreement shall commence on the Effective Date and will continue until for [***] unless sooner terminated pursuant to
Section 3.2 herein (the “Term”) and shall automatically renew thereafter for successive periods of [***]. 

3.2 Termination: This Agreement may be terminated at any time upon the occurrence of any of the following events: 

(a) Termination for Breach: Either party may terminate this Agreement upon the material breach (which shall include any breach of
payment terms) of any provision of this Agreement by the other party if such breach is not cured by the breaching party within [***] (or such additional time reasonably necessary to cure such breach as agreed by the parties in writing
provided the breaching party has commenced a cure within the [***] period and is diligently pursuing completion of such cure) after receipt by the breaching party of written notice of such breach. 

(b) Termination for Financial Matters: This Agreement may be terminated immediately by either party by giving the other party written
notice thereof in the event such other party becomes insolvent, generally fails to pay its debts as they fall due, makes a general assignment for the benefit of its creditors, or proceedings are commenced in any court by or against such party
seeking (a) such party’s reorganization, liquidation, dissolution, arrangement or winding up, or the composition or readjustment of its debts, (b) the appointment of a receiver or trustee for or over such party’s property, or
(c) similar relief in respect of such party under any law relating to bankruptcy, insolvency, reorganization, winding up or composition or adjustment of debt. 

(c) Termination for Change of Control. This Agreement may be terminated by Client upon [***] prior written notice to Althea in the event
that Client or Althea undergoes a transfer or sale of all or substantially all of the business of such party to which this Agreement relates whether by merger, sale of stock, sale of assets or otherwise, and whether voluntary or involuntary, and by
operation of law or otherwise, subject to amounts due under section 2.4, if any, with respect to the minimum purchase requirements in a calendar year. 

(d) Termination for Convenience: Either party shall have the right to terminate this Agreement, without cause, with [***] written
notice. In the event Althea terminates, Althea shall accept a non-cancellable Purchase Order for up to [***] of Client Product to be produced, provided it is consistent with the most recent accepted Forecast
and delivered within [***] of notice of termination. In the event Client terminates, Client shall provide Althea a Purchase Order for orders during the notice period at least equal to the amount purchased over the prior [***]. 

3.3 Payments on Cancellation; Expense Reimbursement: 

In the event of a cancellation by Client of the Production activities set forth in the SOW or in the event of termination of this Agreement,
except for termination in the event of a material breach by Althea pursuant to Section 3.2(a) (collectively, a “Cancellation”), Client shall reimburse Althea for: 

(a) all reasonable wind-down costs, costs of materials and supplies with respect to the Production that were ordered prior to notice of
termination and are not cancelable or returnable (after Althea having used commercially reasonable efforts to mitigate), and any reasonable restocking and shipping costs actually incurred by Althea for those materials or supplies that are
returnable; 

  

					
		  	8.	  	        

 [***] = CONFIDENTIAL TREATMENT REQUESTED 

 

 (b) all
work-in-process with respect to the Client Product commenced by Althea; and all completed Client Product (at the Purchase Price). 

3.4 Payments on Cancellation/Delay; Short-Notice Fees: 

[***]. 
 3.5 Technology
Transfer: Upon any termination, expiration, cancellation or abandonment of this Agreement other than by Althea under sections 3.2(a) or 3.2(b), Althea will provide reasonable technology transfer assistance services to Client in connection with
the establishment of Client Product manufacturing capabilities at Client’s facility or at one or more contract manufacturers selected by Client. In addition, Althea will provide Client, or its designated contract manufacturer, with copies of
the following documentation, to the extent not already provided during the Term: (a) all technical reports and materials for process development activities completed at the time of such transfer that are relevant to and would be required to
manufacture the Client Product using the processes as performed by Althea at such time (including but not limited to any recovery steps established, process validation, product identity assays,
in-process-control assays, applicable computer software, relevant standard operating procedures, blueprints of facilities, information regarding equipment and the layout thereof, etc.), (b) all regulatory
filings relating to the such manufacturing process or the Client Product, (c) all necessary cGMP documentation relating to the manufacturing process for Client Product and required for regulatory filings, and (d) such other information as
Client may reasonably request with respect to the transfer of manufacturing capabilities and requirements regarding the Client Product. In the event of (i) termination of this Agreement by Client pursuant to Section 3.2(a), and without
limiting the rights granted to Client pursuant to Section 10.2, Althea hereby grants to Client a perpetual, irrevocable, non-exclusive, worldwide, royalty-free, fully-paid, sublicenseable (through
multiple tiers) license under all intellectual property and know-how owned or controlled by Althea that is incorporated into any Production hereunder, and which is necessary in order to make, have made, use,
sell, offer for sale, have sold and import the Client Product(s), or (ii) expiration or termination of this Agreement (other than by Client pursuant to Section 3.2(a)), the Parties shall negotiate in good faith regarding Althea granting to
Client a perpetual, irrevocable, non-exclusive, worldwide, sublicenseable (through multiple tiers) license under all intellectual property and know-how owned or
controlled by Althea that is incorporated into any Production hereunder and which is necessary in order to make, have made, use, sell, offer for sale, have sold and import the Client Product(s). Client will bear all costs incurred in connection with
these technology transfer services at prices and under such terms as the parties shall agree in writing. 
 3.6 Survival: Termination,
expiration, cancellation or abandonment of this Agreement through any means or for any reason shall be, except as set forth in to Article 7, without prejudice to any accrued obligation or the rights and remedies of either party with respect to any
antecedent breach of any of the provisions of this Agreement. The provisions of Articles 1, 5, 6 and 9 through 15 inclusive, and Sections 2.10(c), 3.3, 3.5, 3.6 and 4.4 hereof shall survive expiration or termination of this Agreement. 

  

					
		  	9.	  	        

 [***] = CONFIDENTIAL TREATMENT REQUESTED 

 

 4. CERTIFICATES OF ANALYSIS AND MANUFACTURING COMPLIANCE. 

4.1 Certificates of Analysis: At Client’s cost and expense, Althea shall test, or cause to be tested by third parties, in
accordance with the Specifications, each Batch of Client Product Produced pursuant to this Agreement before delivery to Client. The Certificate of Analysis for each Batch delivered shall be included with the Released Executed Batch Record and shall
set forth the items tested, Specifications, and test results. Althea shall also indicate on the final page of the Released Executed Batch Record that all batch Production and control records have been reviewed and approved by the appropriate quality
control unit of Althea. Althea shall send, or cause to be sent, such certificates to Client prior to the shipment of Client Product (unless Client Product is shipped under quarantine pursuant to a separate written agreement between the parties).
Client shall be responsible for the final release of each Batch of Client Product. 
 4.2 Manufacturing Compliance: Althea shall
advise Client immediately if an authorized agent of any Regulatory Authority visits the Facility and makes an inquiry regarding Althea’s Production of Client Product. 

4.3 Audits: Client, at mutually agreed times during normal business hours, shall have the right to inspect, once per calendar year for
not more than two days, Althea Batch records and the portions of the Facility used for Production of Client Product. If the parties agree to audits more than one time in a calendar year or for more than two days, Client agrees to reimburse Althea
for Althea’s reasonable expenses incurred in hosting the additional audit day(s). All audited data will be treated as Confidential Information of Althea, and Client shall not be permitted to remove or copy data without Althea’s prior
consent. 
 4.4 Regulatory Compliance: Unless otherwise stated, Althea is responsible for compliance with all Federal, State and local
laws and regulations (“Regulations”) as they apply generally to the Facility or generally to its production of pharmaceutical products. Althea shall be solely responsible for all contact with Regulatory Authorities with
respect thereto, provided that Althea shall give Client a reasonable opportunity, where feasible, to comment on any correspondence with Regulatory Authorities which would reasonably be expected to have a material impact on Production of Client
Product. Client shall be responsible for compliance with all Regulations as they apply to all other aspects of the Production, including the Client-Supplied Components, specific approval to manufacture Client Product at the Facility and the use,
Labeling and sale of Client Product, which responsibility shall include, without limitation, all contact with Regulatory Authorities regarding the foregoing. Althea shall use its commercially reasonable efforts to assist Client in obtaining
necessary regulatory approvals in accordance with the rates for Regulatory Support as set forth in the SOW. 
 5. ACCEPTANCE OF CLIENT PRODUCT. 

5.1 Acceptance and Non-Conforming Client Product: Within [***] from the date of completion of
Althea’s testing and release of each Batch of Client Product, Althea shall promptly forward to Client, or Client’s designee, copies of the Released Executed Batch Record any other release documents associated with the manufacture of such
Batch as set forth in the SOW or Quality Agreement. Within [***] after receipt by Client of such documentation, Client or its designee may perform a review of such Released Executed Batch Record and other documents associated with the manufacture of
such Batch delivered hereunder and perform such other testing, inspection and review as Client deems necessary and appropriate, to confirm whether Client Product conforms to the quantity ordered, Althea’s product warranty in
Section 11.2(a), and shall notify Althea in writing of Client’s acceptance or rejection of such Client Product. Any such Client Product rejected hereunder, shall be referred to as “Rejected Product.” The parties may
mutually agree in writing to multiple release cycles requiring more than one Released Executed Batch Record with respect to certain Purchase Orders issued under this Agreement, and the procedures contemplated hereunder will apply to each such
Released Executed Batch Record. 

  

					
		  	10.	  	        

 [***] = CONFIDENTIAL TREATMENT REQUESTED 

 

 (a) If Client provides written acceptance of such Batch or does not notify Althea
within the above time period that any Batch of Client Product does not conform to the product warranties of section 11.2(a) (“non-conforming” or “defect(ive)”),
then Client shall be deemed to have accepted the Client Product and waived its right to revoke acceptance, provided that Client may revoke its acceptance with respect to any amount of Client Product that is
non-conforming and such non-conformity complies with all of the following (i) it existed at the time of shipment by Althea under section 2.7 (ii) was not reasonably
discoverable at the time of delivery of the Released Executed Batch Record to Client by reasonable testing, inspection and review of Client Product and release documents by Client, (iii) was caused by Althea’s negligence or, Althea’s
breach of 11.2(a) or was caused by a defect or non-conformity in any Althea-Supplied Component, and (iv) Client gives notice thereof to Althea within [***] of Client first learning of such non-conformity or defect, and prior to the expiration date of the Batch, but in no event later than [***] from such time of shipment by Althea (a “Limited Latent Defect”). Nothing in this
Section 5 will be construed in any way to limit Client’s indemnification rights under Section 13.2. 
 (b) With respect
to Rejected Product Client shall notify Althea by telephone, including a detailed explanation of the non-conformity, and shall confirm such notice in writing via overnight delivery to Althea. Upon receipt of
such notice, Althea will investigate such alleged non-conformity, and (i) if Althea agrees such Client Product is non-conforming, deliver to Client a corrective
action plan within [***] after receipt of Client’s written notice of non-conformity, or such additional time, if mutually agreed by the Parties, as is reasonably required (e.g. if such investigation or
plan requires data from sources other than Client or Althea), or (ii) if Althea disagrees with Client’s determination that the Batch of Client Product is non-conforming, Althea shall so notify Client
by telephone within such [***] period and confirm such notice in writing by overnight delivery. 
 (c) Althea will cooperate fully
with any subsequent investigation Client may conduct and will engage in good faith discussions with Client to determine the cause of the non-conformity. If the parties dispute whether Client Product is
conforming or non-conforming, samples of the Batch of Client Product will be submitted to a mutually acceptable laboratory or consultant for resolution, whose determination of conformity or non-conformity, and the cause thereof if non-conforming, shall be binding upon the parties. Client and Althea shall share equally the costs of such laboratory or consultant,
except as set forth in section 5.2. 
 (d) Client will return any Rejected Product received by Client that is agreed by the parties or
determined by the laboratory to be defective to Althea at Althea’s expense or, at Althea’s request, will destroy any such product at Althea’s expense and certify to Althea that such destruction is complete. 

(e) Manufacturing deviations and investigations which occur during Production of Client Product and which do not cause the Production to
be non-compliant with cGMP, shall not be deemed to cause Client Product to be non-conforming. Althea shall not be liable for any
non-conformity arising from defective, contaminated or non-conforming Client-Supplied Components. 

  

					
		  	11.	  	        

 [***] = CONFIDENTIAL TREATMENT REQUESTED 

 

 5.2 Exclusive Remedies for Non-Conforming
Product: In the event Althea agrees, or the independent laboratory determines, that the Batch of Rejected Product is non-conforming as a result of the negligence of Althea, then Althea, at Client’s
option, shall either (a) at Althea’s expense, and subject to Client, at Client’s expense supplying the replacement Bulk Compound and any other Client-Supplied Components (subject to section 5.3), replace such non-conforming Client Product within [***] from receipt of replacement Bulk Compound from Client, or (b) (i) cancel the invoice and refund or credit any prepayment amounts for Rejected Product or (ii) for
Limited Latent Defects, refund or credit (at Client’s option) all amounts paid by Client with respect to such non-conforming Client Product and comply with Section 5.3 below and (c) for Rejected
Product count the non-conforming Batches towards Client’s obligations under the applicable Firm Commitment. In such event Althea shall also reimburse Client for any independent laboratory fees paid by
Client under section 5.1(c). In the event such Client Product is determined by the independent laboratory to be conforming, or to be non-conforming other than due to the negligence of or breach of this
Agreement by Althea, then Client shall reimburse Althea for Althea’s portion of such laboratory’s fees. 
 For clarity and by way
of example, if Client Product is non-conforming due to non-conforming Bulk Compound or other Client-Supplied Components or other matters within the responsibilities of
Client, then Client will not be entitled to the foregoing remedies to the extent attributable thereto. In the case of replacement Client Product, the due date for the final invoice issued at completion of Production of said non-conforming Batch of Client Product will be extended until the date at which replacement Client Product is released and determined to be conforming by Althea and Client and all such replacement Client Product
shall be subject to all rights and remedies of Client hereunder the same as of such Client Product was being submitted to Client for the first time. 

5.3 Lost Bulk Compound and Client Supplied Components: In the case where Client Product is
non-conforming or Bulk Compound is damaged, lost or otherwise rendered unusable, in either case due to the act, error or omission of Althea, then (a) Althea shall file a claim under its Professional
Liability policy for such Bulk Compound (“Lost Bulk Compound”). Client shall be entitled to reimbursement by Althea up to the amount of any insurance proceeds received under such policy to cover the value of any Lost Bulk
Compound. For clarity, Client is responsible for losses of Bulk Compound not caused by the act, error or omission of Althea or in excess of such proceeds and for maintaining its own insurance, including property insurance, in amounts adequate to
cover such losses (b) Althea shall reimburse Client for replacement of other Client Supplied Components lost, damaged or otherwise rendered unusable due to the negligence of, or breach of this Agreement by, Althea. 

6. CLIENT PRODUCT RECALLS. 
 In the event
Client shall be required to recall any Client Product because such Client Product may violate local, state or federal laws or regulations, or the laws or regulations of any applicable foreign government or agency, or does not conform to the
Specifications, or in the event that Client elects to institute a voluntary recall, withdrawal, field alert or similar action (collectively a “Recall”), Client shall be responsible for coordinating such Recall. Client
promptly shall notify Althea if any Client Product is the subject of a Recall and provide Althea with a copy of all documents relating to such Recall. Althea shall reasonably cooperate with Client in connection with any Recall, at Client’s
expense. Client shall be responsible for all of the costs and expenses of such Recall, provided that Althea shall reimburse Client for the reasonable, documented,
out-of-pocket costs of such Recall(s) to the extent caused by a Limited Latent Defect, subject to section 12.1(b). 

  

					
		  	12.	  	        

 [***] = CONFIDENTIAL TREATMENT REQUESTED 

 

 7. FORCE MAJEURE; YIELD 

7.1 Failure of either party to perform under this Agreement (except the obligation to make payments) shall not subject such party to any
liability to the other if such failure is caused by acts of God, acts of terrorism, fire, explosion, flood, drought, war, riot, sabotage, embargo, strikes or other labor trouble, compliance with any order or regulation of any government entity, or
by any cause beyond the reasonable control of the affected party, whether or not foreseeable, provided that written notice of such event is promptly given to the other party. In the case of a force majeure event, Althea shall use commercially
reasonable efforts to assist Client to arrange for the Production of Client Product through subcontracting (subject to Section 2.14) or other means as appropriate to provide Client Product. The responsibility for any differential in the cost
for such Production will be mutually agreed upon by the parties. However, if Althea is unable to provide a solution for the Production of Client Product within days of such event, Client may terminate this Agreement as specified in
Section 3.2(c) without payment of any Cancellation Fee otherwise due. 
 7.2 Yields: [***]. 

8. CHANGES IN PRODUCTION. 
 8.1 Changes
to Master Batch Records and SOW: Each party agrees to notify the other promptly of any regulatory or other requested changes to the SOW, including the Client Product, Production, Specifications or the MBR. Upon such notification, Althea shall
provide an estimate of any additional fees and costs required and a time line for implementation. No change(s) to any of the foregoing shall be effective or binding unless reduced to writing and signed by both parties. 

8.2 Product-Specific Changes: If Facility, equipment, process or system changes are required of Althea as a result of requirements set
forth by the FDA or any Regulation, and such regulatory changes apply only to the Production and supply of one or more Client Products, then Client and Althea will review such requirements and agree in writing to the changes, and Client shall bear
the reasonable costs thereof. 
 8.3 General Changes: If such regulatory changes apply generally to the Client Product as well as to
other products produced by Althea for itself or for third parties, then Client shall pay a pro rata amount of the reasonable cost of such regulatory changes based upon the proportion of time that the Facility is dedicated to the Production of Client
Product relative to the production of such other products. 
 8.4 Unused Materials In the event of changes requested by Client or to
comply with any regulatory requirement, Client shall reimburse Althea for any Althea-Supplied Components that cannot reasonably be used by Althea or returned for credit. 

9. CONFIDENTIALITY. 
 9.1
Confidentiality. For purposes of this Agreement “Confidential Information” means all information provided by or on behalf of one party (the “Disclosing Party”) to the other party in connection with
this Agreement including, without limitation, all data, inventions and information developed in or as a result of the performance of this Agreement, whether in oral, written, graphic or electronic form. Without limiting the generality of the
foregoing, all Inventions and Intellectual Property of either party shall be deemed the “Confidential Information” of such party. Notwithstanding anything to the contrary, all Client Product specific information, including
without limitation the Master Batch Record, Released Executed Batch Record and Specifications, shall be 

  

					
		  	13.	  	        

 deemed the “Confidential Information” of Client. Each party agrees, with respect to
any Confidential Information disclosed to such party (the “Receiving Party”) by the Disclosing Party hereunder: (a) to use such Confidential Information only for the purposes set forth in this Agreement; (b) to
receive, maintain and hold the Confidential Information in strict confidence and to use the same methods and degree of care (but at least reasonable care) to prevent disclosure of such Confidential Information as it uses to prevent disclosure of its
own proprietary and Confidential Information and to protect against its dissemination to unauthorized parties; (c) not to disclose, or authorize or permit the disclosure of any Confidential Information to any third party without the prior
written consent of the Disclosing Party; (d) to only disclose Confidential Information to employees, agents and consultants of the Receiving Party who have a need to know such information in connection with the Receiving Party’s
performance under this Agreement and who are bound by a duty of confidentiality and non-use as least as protective as the terms of this Agreement prior to disclosure; and (e) to return or destroy any
Confidential Information to the Disclosing Party at the request of the Disclosing Party and/or upon termination/expiration of this Agreement and to retain no copies or reproductions thereof, except that the Receiving Party may retain a single
archival copy of the Confidential Information for the sole purpose of determining the scope of obligations incurred under this Agreement. 

9.2 Limitations. The Receiving Party shall not be obligated to treat information as Confidential Information of the Disclosing Party if
the Receiving Party can show by competent written evidence that such information: (a) was already known to the Receiving Party without any obligations of confidentiality prior to receipt from the Disclosing Party; (b) was generally
available to the public or otherwise part of the public domain at the time of its disclosure to the Receiving Party; (c) became generally available to the public or otherwise part of the public domain after its disclosure, other than through
any act or omission of the Receiving Party in breach of any obligation of confidentiality; (d) was disclosed to the Receiving Party, by a third party who had no obligation direct or indirect, to Disclosing Party with respect to confidentiality
or non-use; or (e) was independently discovered or developed by the Receiving Party without the use of or reference to the Disclosing Party’s Confidential Information. 

9.3 Authorized Disclosure. Notwithstanding Section 9.1, the Receiving Party may disclose Confidential Information, without
violating its obligations under Article 9, to the extent the disclosure is required by a valid order of a court or other governmental body having jurisdiction; provided, however, that the Receiving Party gives reasonable prior written
notice to the Disclosing Party of such required disclosure and makes a reasonable effort to assist the Disclosing Party at Disclosing Party’s expense in obtaining, a protective order preventing or limiting the disclosure and/or requiring that
the Confidential Information so disclosed be used only for the purposes for which the law or regulation requires, or for which the order was issued. The Receiving Party will limit access to the Confidential Information of the Disclosing Party to
only those of the Receiving Party’s employees or authorized representatives having a need to know and who are bound by obligations of confidentiality and non-use consistent with those set forth herein.
Notwithstanding the foregoing, Althea shall be permitted to disclose Client Product information to third party developmental and analytical service providers who have a need to know such information in connection with performance of its obligations
hereunder, provided such providers shall be subject to confidentiality agreements consistent with this Article 9. 
 9.4 Injunctive
Relief. The parties expressly acknowledge and agree that any breach or threatened breach of this Article 9 may cause immediate and irreparable harm to the Disclosing Party which may not be adequately compensated by damages. Each party
therefore agrees that in the event of such breach or threatened breach and in addition to any remedies available at law, the Disclosing Party shall have the right to seek equitable and injunctive relief, without bond, in connection with such a
breach or threatened breach. 

  

					
		  	14.	  	        

 [***] = CONFIDENTIAL TREATMENT REQUESTED 

 

 9.5 Public Announcements. All publicity, press releases and other announcements
relating to this Agreement shall be reviewed in advance by, and subject to the approval of, both parties (which approval shall not be unreasonably withheld); provided, however, that either party may (a) disclose the terms of this
Agreement insofar as required to comply with applicable securities laws, provided that in the case of such disclosures the party proposing to make such disclosure notifies the other party reasonably in advance of such disclosure and
cooperates to minimize the scope and content of such disclosure, and (b) disclose the terms of this Agreement to such party’s investors, professional advisors or potential investors, acquirers, or merger candidates who are bound by
obligations of confidentiality and non-use consistent with those set forth herein. The failure of a party to respond in writing to a publication proposal from the other party within five working days of such
party’s receipt of such publication shall be deemed as such party’s approval of such publication as received by such party. Each party agrees that it shall cooperate fully and in a timely manner with the other with respect to any
disclosures to the Securities and Exchange Commission and any other governmental or regulatory agencies, including requests for confidential treatment of Confidential Information of either party included in any such disclosure. 

9.6 Duration of Confidentiality: All obligations of confidentiality and non-use imposed upon the
parties under this Agreement shall expire [***]; provided, however, that Confidential Information which [***], subject to the limitations set forth in Sections 9.2 and 9.3. 

10. INVENTIONS. 
 10.1 Existing
Intellectual Property; Client’s Intellectual Property: Except as the parties may otherwise expressly agree in writing, each party shall continue to own its existing patents, trademarks, copyrights, trade secrets and other Intellectual
Property, as well as the foregoing developed or acquired by such party outside of this Agreement, without conferring any interests therein on the other party. Without limiting the generality of the preceding sentence, Client shall retain all right,
title and interest, including, without limitation, all Intellectual Property, arising under the United States Patent Act, the United States Trademark Act, the United States Copyright Act and all other applicable laws, rules and regulations in and to
all Client Product, Labeling and trademarks associated therewith and any Inventions which are conceived, reduced to practice, or created by or on behalf of a party or jointly by or on behalf of the parties in the course of performing its obligations
under this Agreement which Inventions (a) arise or are derived from Client’s Confidential Information, and/or the use or access thereof, or (b) are specific to Client Product or Bulk Compound (collectively, “Client’s
Intellectual Property”). Neither Althea nor any third party shall acquire any right, title or interest in Client’s Intellectual Property by virtue of this Agreement or otherwise, except to the extent expressly provided herein,
provided, that Althea shall have a non-exclusive, non-transferable, non-sublicenseable,
non-assignable royalty-free license, during the Term, to use any and all Client’s Intellectual Property that Client has provided to Althea solely for the purpose of performing its obligations under this
Agreement. All Client’s Intellectual Property shall be considered the Confidential Information of Client. 

  

					
		  	15.	  	        

 10.2 Althea Owned Inventions: All Inventions which are conceived, reduced to
practice, or created solely by Althea or its agents in the course of performing its obligations under this Agreement which are both (i) generally applicable to the manufacture of pharmaceutical products, and (ii) not Client’s
Intellectual Property, shall be solely owned and subject to use and exploitation by Althea (“Althea Inventions”), provided that, Althea hereby grants to Client a fully-paid, royalty-free,
non-exclusive, fully transferrable, fully sublicenseable (through multiple tiers), perpetual, irrevocable, worldwide license under the Althea Inventions and all Intellectual Property rights therein, to
develop, make, have made, use, sell, offer for sale and import the Client Product(s), that would otherwise infringe the rights in such Althea Inventions absent such license grant to Client. 

10.3 Other Inventions: All Inventions which are conceived, reduced to practice, or created jointly by the parties and/or their
respective agents in the course of the performance of this Agreement and which are not Client’s Intellectual Property, shall be owned by Client (“Other Inventions”), provided that Client hereby grants Althea a non-exclusive, non-royalty bearing, worldwide, fully paid up license in all fields to such Other Inventions, including the right to sublicense. In the event Client abandons or
declines prosecution of any Other Invention patent, or separately patentable claim set(s) thereof, in any jurisdiction, Client shall notify Althea, and upon Althea’s written request, assign all of its rights, title and interest in and to such
Other Invention patent or claim set(s) applicable to such abandoned/declined jurisdictions to Althea. 
 10.4 Disclaimer: Except as
otherwise expressly provided herein, nothing contained in this Agreement shall be construed or interpreted, either expressly or by implication, estoppel or otherwise, as: (i) a grant, transfer or other conveyance by either party to the other of
any right, title, license or other interest of any kind in any of its Inventions or other Intellectual Property, (ii) creating an obligation on the part of either party to make any such grant, transfer or other conveyance or
(iii) requiring either party to participate with the other party in any cooperative development program or project of any kind or to continue with any such program or project. 

10.5 Rights in Inventions: The party owning any Invention shall have the world wide right to control the drafting, filing, prosecution
and maintenance of patents covering the Inventions including decisions about the countries in which to file patent applications. Patent costs associated with the patent activities described in this Section shall be borne by the sole owner. Each
party will cooperate with the other party in the filing and prosecution of patent applications. Such cooperation will include, but not be limited to, furnishing supporting data and affidavits for the prosecution of patent applications and completing
and signing forms needed for the prosecution, assignment and maintenance of patent applications. 
 10.6 Confidentiality of
Inventions: Inventions shall be and any disclosure of information by one party to the other under the provisions of this Article 10 shall be subject to the provisions of Article 9. It shall be the responsibility of the party preparing a patent
application to obtain the written permission of the other party to use or disclose the other party’s Confidential Information in the patent application before the application is filed and for other disclosures made during the prosecution of the
patent application, such permission not to be unreasonably withheld or delayed. 
 11. REPRESENTATIONS AND WARRANTIES. 

11.1 Mutual Representations: Each party hereby represents and warrants to the other party that (a) such party is duly organized,
validly existing, and in good standing under the laws of the place of its establishment or incorporation, (b) such party has taken all corporate action necessary to authorize it to enter into this Agreement and perform its obligations under
this Agreement, (c) this Agreement will constitute the legal, valid and binding obligation of such party, and (d) neither the execution of this Agreement nor the performance of such party’s obligations hereunder will conflict with,
result in a breach of, or constitute a default under any provision of the organizational documents of such party, or of any law, rule, regulation, authorization or approval of any government entity, or of any agreement to which it is a party or by
which it is bound. 

  

					
		  	16.	  	        

 11.2 Althea Warranty: 

(a) Product Warranty: Althea represents and warrants that Client Product shall be Produced in accordance with Specifications and cGMP
and shall not have become adulterated or misbranded due to the negligence of Althea or Althea’s failure to comply with the terms of this Agreement. 

(b) Althea warrants and covenants that has no knowledge of any patents or other Intellectual Property that would be infringed or
misappropriated by Althea’s Production of Client Product hereunder. 
 (c) Althea warrants and covenants that it will not use any
employee or consultant that has been debarred by a regulatory authority, excluded from a federal health care program, or convicted of or pled nolo contendere to any felony or to any federal or state legal violation (including misdemeanors) relating
to prescription drug products or fraud, or, to the best of its knowledge, is the subject of debarment proceedings by a regulatory authority. 

(d) Althea warrants and covenants that it will not enter into any agreement or arrangement with any other entity that would prevent or
in any way interfere with Althea’s ability to perform its obligations hereunder (other than resource allocation and scheduling issues inherent in its business). 

(e) Althea represents and warrants that it has obtained (or will obtain prior to Producing Client Product), and will remain in
compliance with during the Term, all permits, licenses and other authorizations which are required under federal, state and local laws, rules and regulations generally applicable to its operations and the Facility; provided, however,
Althea shall have no obligation to obtain permits specific to the manufacture of Client Product or relating to the sale, marketing, distribution or use of Bulk Compound or Client Product or with respect to the Labeling of Client Product. 

(f) Althea makes no representation or warranty with respect to the sale, marketing, Labeling, distribution or use of the Bulk Compound
or, except as expressly set forth in this Section 11.2, the Client Product. 
 11.3 Client Warranties: Client represents and
warrants that (a) it has the right to give Althea any Client-Supplied Components and information provided by Client hereunder, and that Althea has the right to use such components and information for the Production of Client Product, and
(b) Client has no knowledge of any patents or other Intellectual Property that would be infringed or misappropriated by Althea’s Production of Client Product or performance of any other of its obligations under this Agreement, and
(c) further warrants that the Bulk Compound and other Client-Supplied Components provided to Althea hereunder conform to the applicable Specifications at the time of delivery to Althea. 

  

					
		  	17.	  	        

 [***] = CONFIDENTIAL TREATMENT REQUESTED 

 

 11.4 Disclaimer of Warranties: Except as expressly set forth in this Agreement,
NEITHER PARTY MAKES ANY REPRESENTATION OR WARRANTY OF ANY KIND, EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF TITLE, NON-INFRINGEMENT, MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
Without limiting the foregoing, Althea makes no representation or warranty relating to the stability, efficacy, safety, or toxicity of any Client Product, except that such Client Product meets the warranty in Section 11.2(a). 

12. LIMITATION OF LIABILITY AND WAIVER OF PROPERTY CLAIMS. 

12.1 Limitation of Liability: (a) Client’s sole and exclusive remedy for Althea’s delivery of “non-conforming” or “defective” Client Product contemplated by 5.1(a) or breach of the warranty set forth in Section 11.2(a) is limited to those remedies set forth in Article 5 and 6 and, if
applicable, Section 7.2, provided that the foregoing shall not limit Althea’s indemnification obligations hereunder. EXCEPT WITH RESPECT TO EACH PARTY’S INDEMNIFICATION OBLIGATIONS, BREACH OF ARTICLE 9, OR INFRINGEMENT OR
MISAPPROPRIATION OF A PARTY’S INTELLECTUAL PROPERTY, UNDER NO CIRCUMSTANCES SHALL EITHER PARTY BE LIABLE FOR LOSS OF USE OR PROFITS OR OTHER INDIRECT, COLLATERAL, SPECIAL, CONSEQUENTIAL, PUNITIVE OR OTHER DAMAGES, COST OF COVER, LOSSES, OR
EXPENSES, IN CONNECTION WITH, OR BY REASON OF THE PRODUCTION AND DELIVERY OF CLIENT PRODUCT UNDER THIS AGREEMENT WHETHER SUCH CLAIMS ARE FOUNDED IN TORT OR CONTRACT. IN NO EVENT WILL ALTHEA BE RESPONSIBLE FOR REPLACING ANY COMPONENTS OR MATERIALS
SUPPLIED BY CLIENT EXCEPT AS SET FORTH IN PARAGRAPH 5.3. 
 (b) EXCEPT WITH RESPECT TO A PARTY’S INDMENIFICATION OBLIGATIONS,
BREACH OF ARTICLE 9, OR INFRINGEMENT OR MISAPPROPRIATION OF A PARTY’S INTELLECTUAL PROPERTY, IN NO EVENT SHALL EITHER PARTY’S AGGREGATE LIABILITY UNDER THIS AGREEMENT, INCLUDING BUT NOT LIMITED TO ANY COSTS OF RECALL(S) [***]. THIS
LIMITATION SHALL APPLY NOTWITHSTANDING ANY FAILURE OF ESSENTIAL PURPOSE OF ANY LIMITED REMEDY. 
 12.2 Waiver of Property Claims: All
Althea Supplied Components and equipment used by Althea in the Production of Client Product (collectively, “Althea Property”) shall at all times remain the property of Althea and Althea assumes risk of loss for such property
until delivery of Client Product to a common carrier as specified under Section 2.7 or when risk of loss otherwise shifts to Client. Althea hereby waives any and all rights of recovery against Client and its Affiliates, and against any of their
respective directors, officers, employees, agents or representatives, for any loss or damage to Althea Property. Except as set forth in section 5.3, Client assumes all risk of loss at all times for all Client Supplied Components and Client
equipment. Client assumes risk of loss for all Client Product upon delivery to a common carrier as specified under Section 2.7 or when risk of loss otherwise shifts to Client pursuant to the Agreement. 

13. INDEMNIFICATION. 
 13.1 Client
Indemnification: Client hereby agrees to save, defend, indemnify and hold harmless Althea and its Affiliates and their respective officers, directors, employees, contractors, consultants and agents (each, an “Althea
Indemnitee”) from and against any and all losses, damages, liabilities, expenses and costs, including reasonable legal expenses and attorneys’ fees (“Losses”), to which any Althea Indemnitee may become
subject as a result of any claim, demand, action or other proceeding by any third party including, without limitation, property damage, death or personal injury of third parties (a “Claim”) against an Althea Indemnitee to the
extent arising or resulting from 

  

					
		  	18.	  	        

 [***] = CONFIDENTIAL TREATMENT REQUESTED 

 

 
(a) Client’s storage, disposal, promotion, labeling, marketing, distribution, forward processing, use or sale of Client Product or Client-Supplied Components, (b) Client’s
negligence or willful misconduct, (c) any claim that the use, sale, marketing or distribution of Bulk Compound or Client Product by Client, or the Production of Client Product by Althea with respect to, and in accordance with the Specifications
or any manufacturing procedures or written instructions provided by Client, violates the patent, trademark, copyright or other proprietary rights of any third party or (d) Client’s employees or contractors, including with limitation any
personal injury/workman’s compensation, employment- or benefit-related claims, except to the extent any such Loss(es) are caused by the gross negligence or willful misconduct of the Althea Indemnitees or within any matters indemnified by Althea
in Section 13.2. 
 13.2 Althea Indemnification: Althea hereby agrees to save, defend, indemnify and hold harmless Client and its
Affiliates and any of their respective directors, officers, employees, subcontractors and agents (each, a “Client Indemnitee”) from and against any and all Losses to which any Company Indemnitee may become subject as a result
of any Claim to the extent arising or resulting from (a) defects in Client Product caused by Althea’s negligence or willful misconduct or material breach of this Agreement, (b) Althea’s storage, disposal, labeling, use, sale,
marketing, forward processing, or distribution of Althea Supplied Components, (c) an Althea Indemnitee’s negligence or willful misconduct or (d) Althea’s employees or contractors, including with limitation any personal
injury/workman’s compensation, employment- or benefit-related claims, except to the extent any such Loss(es) are caused by the gross negligence or willful misconduct of the Client or within any matters indemnified by Client in
Section 13.1. 
 13.3 Indemnitee Obligations: A party that makes a claim for indemnification under this Article 13 shall promptly
notify the other party (the “Indemnitor”) in writing of any action, claim or other matter in respect of which such party, intends to claim such indemnification; provided, however, that failure to provide such notice within a
reasonable period of time shall not relieve the Indemnitor of any of its obligations hereunder except to the extent the Indemnitor is prejudiced by such failure. The indemnified party shall permit the Indemnitor, at its discretion, to settle any
such action, claim or other matter, and the indemnified party agrees to the complete control of such defense or settlement by the Indemnitor. Notwithstanding the foregoing, the Indemnitor shall not enter into any settlement that would adversely
affect the indemnified party’s rights hereunder, or impose any obligations on the indemnified party in addition to customary mutual general release terms, without indemnified party’s prior written consent, which shall not be unreasonably
withheld or delayed. No such action, claim or other matter shall be settled without the prior written consent of the Indemnitor, which shall not be unreasonably withheld or delayed. The indemnified party shall fully cooperate with the Indemnitor and
its legal representatives in the investigation and defense of any action, claim or other matter covered by the indemnification obligations of this Article 13. The indemnified party shall have the right, but not the obligation, to be represented in
such defense by counsel of its own selection and at its own expense. 
 14. INSURANCE. 

14.1 Client Insurance: Client shall procure and maintain, from the Effective Date through the date that is one year after the expiration
date of all Client Product Produced under this Agreement, commercial general liability insurance, including without limitation, Product Liability coverage (the “Client Insurance”). The Client Insurance shall cover amounts not
less than $[***] combined single limit and shall be with an insurance carrier reasonably acceptable to Althea. [***] and Client promptly shall deliver a certificate of Client Insurance and endorsement of additional insured to Althea evidencing such
coverage. 

  

					
		  	19.	  	        

 [***] = CONFIDENTIAL TREATMENT REQUESTED 

 

 14.2 Althea Insurance: Althea shall procure and maintain, from the Effective Date
through the date that is one year after the expiration date of all Client Product Produced under this Agreement, Commercial General Liability Insurance, including without limitation, Products and Professional Liability coverage (the
“Althea Insurance”). The Althea Insurance shall cover amounts not less than $[***] combined single limit and shall be with an insurance carrier reasonably acceptable to Client. Client shall be named as an additional insured
on the Althea Insurance and Althea shall promptly deliver a certificate of Althea Insurance and endorsement of additional insured to Client evidencing such coverage. For clarity, in the event an SOW provides for, or Client requests, the Production
and/or storage of Client Product and/or Client-Supplied Components whose aggregate value exceeds this coverage amount, additional insurance may be required at Client’s expense. 

14.3 Waiver of Subrogation: Each party hereby waives and shall cause its insurers to waive any and all rights of recovery against the
other party and its Affiliates, and against any of their respective directors, officers, employees, agents or representatives, for any loss or damage that is covered by insurance whether or not such insurance is described in this Agreement, or
should have been covered by insurance described in this Agreement, but for the waiving party’s failure to procure or maintain it. 
 15. GENERAL
PROVISIONS. 
 15.1 Notices: Any notice to be given under this Agreement must be in writing and delivered either in person, by any
method of mail (postage prepaid) requiring return receipt, or by overnight courier or facsimile confirmed thereafter by any of the foregoing, to the party to be notified at its address given below, or at any address such party has previously
designated by prior written notice to the other. Notice shall be deemed sufficiently given for all purposes upon the actual delivery thereof at the address designated in accordance with this paragraph. 

 

			
	If to Client:	  	Avedro, Inc.
		  	230 Third Ave.
		  	Waltham, MA 02451
		  	Attn: Evan Sherr
		
		  	Telephone:         781-768-3405
		  	Facsimile:          781-768-3401
		
	If to Althea:	  	Ajinomoto Althea Inc.
		  	11040 Roselle Street
		  	San Diego, CA 92121
		  	Attn: Chief Financial Officer
		
		  	Telephone:         (858) 882-0123
		  	Facsimile:          (858) 882-0133

  

					
		  	20.	  	        

 15.2 Entire Agreement; Amendment: The parties hereto acknowledge that this Agreement
sets forth the entire agreement and understanding of the parties and supersedes all prior written or oral agreements or understandings with respect to the subject matter hereof including without limitation the Commercial Supply Agreement between the
parties dated as of 15 August, 2011. No modification of any of the terms of this Agreement, or of any attachments or Appendices, shall be deemed to be valid unless in writing and signed by an authorized agent or representative of both parties
hereto. No course of dealing or usage of trade shall be used to modify the terms and conditions herein. 
 15.3 Waiver: None of the
provisions of this Agreement shall be considered waived by any party hereto unless such waiver is agreed to, in writing, by authorized agents of both parties. The failure of a party to insist upon strict conformance to any of the terms and
conditions hereof, or failure or delay to exercise any rights provided herein or by law shall not be deemed a waiver of any rights of any party hereto. 

15.4 Assignment: This Agreement may not be assigned or transferred by either party including by operation of law without the prior
written consent of the other, which consent will not be unreasonably withheld or delayed; provided, however, that either party may assign this Agreement including by operation of law without the other party’s consent to an
Affiliate or in connection with the transfer or sale of all or substantially all of the business of such party to which this Agreement relates, whether by merger, sale of stock, sale of assets or otherwise, provided that if such assignment is to an
Affiliate, the assigning party shall be jointly responsible for Affiliate’s obligations hereunder. Any attempted assignment of this Agreement not in compliance with this Section 15.4 shall be null and void. No assignment shall relieve
either party of the performance of any accrued obligation that such party may then have under this Agreement. This Agreement shall inure to the benefit of and be binding upon each party signatory hereto, its successors and permitted assigns,
subsidiaries and Affiliates. 
 15.5 Taxes: Client shall bear the cost of all national, state, municipal or other sales, use, excise,
import, property, value added, or other similar taxes, assessments or tariffs assessed upon or levied against the Production or sale of Client Product pursuant to this Agreement or the sale or distribution of Client Product by Client (or at
Client’s sole expense, defend against the imposition of such taxes and expenses). Althea shall notify Client of any such taxes that any governmental authority is seeking to collect from Althea, and Client may assume the defense thereof in
Althea’s name, if necessary, and Althea agrees to fully cooperate in such defense to the extent of the capacity of Althea, at Client’s expense. Althea shall pay all national, state, municipal or other taxes on the income resulting from the
sale by Althea of the Client Product to Client under this Agreement, including but not limited to, gross income, adjusted gross income, supplemental net income, gross receipts, excess profit taxes, or other similar taxes. 

15.6 Independent Contractor: Althea shall act as an independent contractor for Client in providing the services required hereunder and
neither party shall be considered an agent or employer of, or joint venturer with, the other party or its employees. 
 15.7 Governing
Law; Limitations: Any action brought related to this Agreement or the activities contemplated hereunder shall be governed in all respects by the laws of the State of New York, without regard to the principles of conflicts of laws. The federal
and state courts located in New York, shall have personal jurisdiction over the parties hereto in all such actions, and the exclusive venue for any such action brought by either party against the other party will be the federal or state courts
located in New York. All suits or other actions for breach or default under this Agreement or any matter arising out of the contemplated activities shall be brought within one year after the cause of action accrued or shall be deemed waived. 

  

					
		  	21.	  	        

 15.8 Dispute Resolution: Prior to initiating any court, administrative or other
action on a claim, dispute, demand or assertion related to this Agreement or the services hereunder (collectively, a “Claim”), the claimant shall give notice to the other party, detailing the nature of the Claim and the facts
relevant thereto and the parties shall in good faith attempt to resolve such Claim. No court, administrative or other action shall be initiated until the parties have exhausted good faith settlement attempts by first, direct negotiation and second,
mediation by a mutually-agreeable professional mediator under the appropriate Mediation Procedures of the American Arbitration Association. The site of the mediation shall be San Diego, California. The costs of mediation shall be borne equally by
the parties. 
 15.9 Attorney’s Fees: The successful party in any litigation or other dispute resolution proceeding to enforce
the terms and conditions of this Agreement shall be entitled to recover from the other party reasonable attorney’s fees and related costs involved in connection with such litigation or dispute resolution proceeding. 

15.10 Severability: In the event that any one or more of the provisions contained herein, or the application thereof in any
circumstances, is held invalid, illegal or unenforceable in any respect for any reason, the parties shall negotiate in good faith with a view to the substitution therefor of a suitable and equitable provision in order to carry out, so far as may be
valid and enforceable, the intent and purpose of such invalid provision; provided, however, that the validity, legality and enforceability of any such provision in every other respect and of the remaining provisions contained herein
shall not be in any way impaired thereby, it being intended that all of the rights and privileges of the parties hereto shall be enforceable to the fullest extent permitted by law. 

[Signature Page Follows.] 

  

					
		  	22.	  	        

 IN WITNESS WHEREOF, the parties hereto have each caused this Agreement to be executed
by their duly-authorized representatives as of the Effective Date above. 
  

									
	AVEDRO, INC.	  		  	AJINOMOTO ALTHEA, INC.
					
	By:	  	 /s/ David Muller
	  		  	By:	  	 /s/ Martha J. Demski

	Name:	  	David Muller	  		  	Name:	  	Martha J. Demski
	Title:	  	CEO	  		  	Title:	  	SVP and CFO

  

					
		  	23.	  	        

 APPENDIX A 

STATEMENT(S) OF WORK 

  

					
		  	.	  	        

 [***] = CONFIDENTIAL TREATMENT REQUESTED 

 

 APPENDIX B 

CLIENT PRODUCT 

[***] 

  

					
		  	.	  	        

 [***] = TWENTY-SIX (26) PAGES OF CERTAIN CONFIDENTIAL
INFORMATION CONTAINED IN THIS EXHIBIT 10.20, MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED. 

[***]bioc-ex101_6.htm

Exhibit 10.1

SECURITIES PURCHASE AGREEMENT

This Securities Purchase Agreement (this “Agreement”) is dated as of January 18, 2019, between Biocept, Inc., a Delaware corporation (the “Company”), and each purchaser identified on the signature pages hereto (each, including its successors and assigns, a “Purchaser” and collectively the “Purchasers”).

WHEREAS, subject to the terms and conditions set forth in this Agreement and pursuant to an effective registration statement under the Securities Act of 1933, as amended (the “Securities Act”), the Company desires to issue and sell to each Purchaser, and each Purchaser, severally and not jointly, desires to purchase from the Company, securities of the Company as more fully described in this Agreement.

NOW, THEREFORE, IN CONSIDERATION of the mutual covenants contained in this Agreement, and for other good and valuable consideration the receipt and adequacy of which are hereby acknowledged, the Company and each Purchaser agree as follows:

ARTICLE I.
DEFINITIONS

1.1 Definitions.  In addition to the terms defined elsewhere in this Agreement, for all purposes of this Agreement, the following terms have the meanings set forth in this Section 1.1:

“Acquiring Person” shall have the meaning ascribed to such term in Section 4.4.

“Action” shall have the meaning ascribed to such term in Section 3.1(j).

“Affiliate” means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with a Person as such terms are used in and construed under Rule 405 under the Securities Act.  

“Board of Directors” means the board of directors of the Company.

“Business Day” means any day except any Saturday, any Sunday, any day which is a federal legal holiday in the United States or any day on which banking institutions in the State of New York are authorized or required by law or other governmental action to close.

“Closing” means the closing of the purchase and sale of the Shares pursuant to Section 2.1.

“Closing Date” means the Trading Day on which all of the Transaction Documents have been executed and delivered by the applicable parties thereto, and all conditions precedent to (i) the Purchasers’ obligations to pay the Subscription Amount and (ii) the Company’s obligations to deliver the Shares, in each case, have been satisfied 

1

 

or waived, but in no event later than the second (2nd) Trading Day following the date hereof.

 “Commission” means the United States Securities and Exchange Commission.

“Common Stock” means the common stock of the Company, par value $0.0001 per share, and any other class of securities into which such securities may hereafter be reclassified or changed. 

“Common Stock Equivalents” means any securities of the Company or the Subsidiaries which would entitle the holder thereof to acquire at any time Common Stock, including, without limitation, any debt, preferred stock, right, option, warrant or other instrument that is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Common Stock.

 “Company Counsel” means Cooley LLP, with offices located at 4401 Eastgate Mall, San Diego, CA 92121. 

“Disclosure Schedules” means the Disclosure Schedules of the Company delivered concurrently herewith.

“Disclosure Time” means, (i) if this Agreement is signed on a day that is not a Trading Day or after 9:00 a.m. (New York City time) and before midnight (New York City time) on any Trading Day, 9:01 a.m. (New York City time) on the Trading Day immediately following the date hereof, unless otherwise instructed as to an earlier time by the Placement Agent, and (ii) if this Agreement is signed between midnight (New York City time) and 9:00 a.m. (New York City time) on any Trading Day, no later than 9:01 a.m. (New York City time) on the date hereof, unless otherwise instructed as to an earlier time by the Placement Agent.

“EGS” means Ellenoff Grossman & Schole LLP, with offices located at 1345 Avenue of the Americas, New York, New York 10105-0302.

“Evaluation Date” shall have the meaning ascribed to such term in Section 3.1(s). 

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

 

 “FCPA” means the Foreign Corrupt Practices Act of 1977, as amended.

“GAAP” shall have the meaning ascribed to such term in Section 3.1(h).

“Indebtedness” shall have the meaning ascribed to such term in Section 3.1(aa).

“Intellectual Property Rights” shall have the meaning ascribed to such term in Section 3.1(p).

2

 

“Liens” means a lien, charge, pledge, security interest, encumbrance, right of first refusal, preemptive right or other restriction.

“Material Adverse Effect” shall have the meaning assigned to such term in Section 3.1(b).

“Material Permits” shall have the meaning ascribed to such term in Section 3.1(n).

 “Person” means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.

“Placement Agent” means Maxim Group LLC.

“Proceeding” means an action, claim, suit, investigation or proceeding (including, without limitation, an informal investigation or partial proceeding, such as a deposition), whether commenced or threatened.

“Prospectus” means the final prospectus filed for the Registration Statement.

“Prospectus Supplement” means the supplement to the Prospectus complying with Rule 424(b) of the Securities Act that is filed with the Commission and delivered by the Company to each Purchaser at the Closing.

“Purchase Price” equals $2.25 per Share, subject to adjustment for reverse and forward stock splits, stock dividends, stock combinations and other similar transactions of the Common Stock that occur after the date of this Agreement.

“Purchaser Party” shall have the meaning ascribed to such term in Section 4.7.

“Registration Statement” means the effective registration statement with Commission (File No. 333-224946) which registers the sale of the Shares to the Purchasers.

“Required Approvals” shall have the meaning ascribed to such term in Section 3.1(e).

“Rule 144” means Rule 144 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect as such Rule. 

“Rule 424” means Rule 424 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect as such Rule.

 “SEC Reports” shall have the meaning ascribed to such term in Section 3.1(h).

3

 

“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.

“Shares” means the shares of Common Stock issued or issuable to each Purchaser pursuant to this Agreement.

“Short Sales” means all “short sales” as defined in Rule 200 of Regulation SHO under the Exchange Act (but shall not be deemed to include locating and/or borrowing shares of Common Stock). 

 “Subscription Amount” means, as to each Purchaser, the aggregate amount to be paid for Shares purchased hereunder as specified below such Purchaser’s name on the signature page of this Agreement and next to the heading “Subscription Amount,” in United States dollars and in immediately available funds.

“Subsidiary” means any subsidiary of the Company as disclosed in the SEC Reports, and shall, where applicable, also include any direct or indirect subsidiary of the Company formed or acquired after the date hereof.

“Trading Day” means a day on which the principal Trading Market is open for trading.

“Trading Market” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date in question: the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the New York Stock Exchange (or any successors to any of the foregoing).

“Transaction Documents” means this Agreement, all exhibits and schedules thereto and hereto and any other documents or agreements executed in connection with the transactions contemplated hereunder.

“Transfer Agent” means Continental Stock Transfer & Trust Company, the current transfer agent of the Company, with a mailing address of 17 Battery Place, New York, New York 10004 and a facsimile number of (212) 616-7615, and any successor transfer agent of the Company.

ARTICLE II.
PURCHASE AND SALE

2.1Closing.  On the Closing Date, upon the terms and subject to the conditions set forth herein, substantially concurrent with the execution and delivery of this Agreement by the parties hereto, the Company agrees to sell, and the Purchasers, severally and not jointly,  agree to purchase, up to an aggregate of $2,227,500 of Shares as determined pursuant to Section 2.2(a), and the Company shall deliver to each Purchaser its respective Shares as determined pursuant to Section 2.2(a), and the Company and each Purchaser shall deliver the other items set forth in Section 2.2 deliverable at the Closing.  Upon satisfaction of the covenants and conditions set forth in Sections 2.2 and 2.3, the Closing shall occur at the offices of EGS or such other location 

4

 

as the parties shall mutually agree.  Unless otherwise directed by the Placement Agent, settlement of the Shares shall occur via “Delivery Versus Payment” (“DVP”) (i.e., on the Closing Date, the Company shall issue the Shares registered in the Purchasers’ names and addresses and released by the Transfer Agent directly to the account(s) at the Placement Agent identified by each Purchaser; upon receipt of such Shares, the Placement Agent shall promptly electronically deliver such Shares to the applicable Purchaser, and payment therefor shall be made by the Placement Agent (or its clearing firm) by wire transfer to the Company).

2.2Deliveries.

(a)On or prior to the Closing Date, the Company shall deliver or cause to be delivered to each Purchaser the following:

(i)this Agreement duly executed by the Company;

(ii)a legal opinion of Company Counsel, in form and substance acceptable to the Purchasers; 

(iii)subject to the last sentence of Section 2.1, the Company shall have provided each Purchaser with the Company’s wire instructions, on Company letterhead and executed by the Chief Executive Officer or Chief Financial Officer;

(iv)subject to the last sentence of Section 2.1, a copy of the irrevocable instructions to the Transfer Agent instructing the Transfer Agent to deliver on an expedited basis via The Depository Trust Company Deposit or Withdrawal at Custodian system (“DWAC”) Shares equal to such Purchaser’s Subscription Amount divided by the Purchase Price, registered in the name of such Purchaser;

(v)the Prospectus and Prospectus Supplement (which may be delivered in accordance with Rule 172 under the Securities Act).

(b)On or prior to the Closing Date, each Purchaser shall deliver or cause to be delivered to the Company the following:

(i)this Agreement duly executed by such Purchaser; and

(ii)such Purchaser’s Subscription Amount, which shall be made available for “Delivery Versus Payment” settlement with the Company or its designee.

2.3Closing Conditions. 

(a)The obligations of the Company hereunder in connection with the Closing are subject to the following conditions being met:

(i)the accuracy in all material respects (or, to the extent representations or warranties are qualified by materiality or Material Adverse Effect, in all respects) on the Closing Date of the representations and warranties 

5

 

of the Purchasers contained herein (unless as of a specific date therein in which case they shall be accurate as of such date); 

(ii)all obligations, covenants and agreements of each Purchaser required to be performed at or prior to the Closing Date shall have been performed; and

(iii)the delivery by each Purchaser of the items set forth in Section 2.2(b) of this Agreement.

(b)The respective obligations of the Purchasers hereunder in connection with the Closing are subject to the following conditions being met:

(i)the accuracy in all material respects (or, to the extent representations or warranties are qualified by materiality or Material Adverse Effect, in all respects) when made and on the Closing Date of the representations and warranties of the Company contained herein (unless as of a specific date therein in which case they shall be accurate as of such date);

(ii)all obligations, covenants and agreements of the Company required to be performed at or prior to the Closing Date shall have been performed; 

(iii)the delivery by the Company of the items set forth in Section 2.2(a) of this Agreement; 

(iv)there shall have been no Material Adverse Effect with respect to the Company since the date hereof; and

(v)from the date hereof to the Closing Date, trading in the Common Stock shall not have been suspended by the Commission or the Company’s principal Trading Market, and, at any time prior to the Closing Date, trading in securities generally as reported by Bloomberg L.P. shall not have been suspended or limited, or minimum prices shall not have been established on securities whose trades are reported by such service, or on any Trading Market, nor shall a banking moratorium have been declared either by the United States or New York State authorities nor shall there have occurred any material outbreak or escalation of hostilities or other national or international calamity of such magnitude in its effect on, or any material adverse change in, any financial market which, in each case, in the reasonable judgment of such Purchaser, makes it impracticable or inadvisable to purchase the Shares at the Closing.

ARTICLE III.
REPRESENTATIONS AND WARRANTIES

3.1Representations and Warranties of the Company.  Except as set forth in the Disclosure Schedules, which Disclosure Schedules shall be deemed a part hereof and shall qualify any representation or otherwise made herein to the extent of the disclosure contained in 

6

 

the corresponding section of the Disclosure Schedules, the Company hereby makes the following representations and warranties to each Purchaser:

(a)Subsidiaries.  All of the direct and indirect subsidiaries of the Company are set forth on Schedule 3.1(a).  The Company owns, directly or indirectly, all of the capital stock or other equity interests of each Subsidiary free and clear of any Liens, and all of the issued and outstanding shares of capital stock of each Subsidiary are validly issued and are fully paid, non-assessable and free of preemptive and similar rights to subscribe for or purchase securities.  If the Company has no subsidiaries, all other references to the Subsidiaries or any of them in the Transaction Documents shall be disregarded.

(b)Organization and Qualification.  The Company and each of the Subsidiaries is an entity duly incorporated or otherwise organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization, with the requisite power and authority to own and use its properties and assets and to carry on its business as currently conducted.  Neither the Company nor any Subsidiary is in violation nor default of any of the provisions of its respective certificate or articles of incorporation, bylaws or other organizational or charter documents.  Each of the Company and the Subsidiaries is duly qualified to conduct business and is in good standing as a foreign corporation or other entity in each jurisdiction in which the nature of the business conducted or property owned by it makes such qualification necessary, except where the failure to be so qualified or in good standing, as the case may be, could not have or reasonably be expected to result in: (i) a material adverse effect on the legality, validity or enforceability of any Transaction Document, (ii) a material adverse effect on the results of operations, assets, business, prospects or condition (financial or otherwise) of the Company and the Subsidiaries, taken as a whole, or (iii) a material adverse effect on the Company’s ability to perform in any material respect on a timely basis its obligations under any Transaction Document (any of (i), (ii) or (iii), a “Material Adverse Effect”) and no Proceeding has been instituted in any such jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or curtail such power and authority or qualification.

(c)Authorization; Enforcement.  The Company has the requisite corporate power and authority to enter into and to consummate the transactions contemplated by this Agreement and each of the other Transaction Documents and otherwise to carry out its obligations hereunder and thereunder.  The execution and delivery of this Agreement and each of the other Transaction Documents by the Company and the consummation by it of the transactions contemplated hereby and thereby have been duly authorized by all necessary action on the part of the Company and no further action is required by the Company, the Board of Directors or the Company’s stockholders in connection herewith or therewith other than in connection with the Required Approvals.  This Agreement and each other Transaction Document to which it is a party has been (or upon delivery will have been) duly executed by the Company and, when delivered in accordance with the terms hereof and thereof, will constitute the valid and binding obligation of the Company enforceable against the Company in accordance with its terms, except (i) as limited by general equitable principles and applicable bankruptcy, insolvency, reorganization, 

7

 

moratorium and other laws of general application affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies and (iii) insofar as indemnification and contribution provisions may be limited by applicable law.

(d)No Conflicts.  The execution, delivery and performance by the Company of this Agreement and the other Transaction Documents to which it is a party, the issuance and sale of the Shares and the consummation by it of the transactions contemplated hereby and thereby do not and will not (i) conflict with or violate any provision of the Company’s or any Subsidiary’s certificate or articles of incorporation, bylaws or other organizational or charter documents, or (ii) conflict with, or constitute a default (or an event that with notice or lapse of time or both would become a default) under, result in the creation of any Lien upon any of the properties or assets of the Company or any Subsidiary, or give to others any rights of termination, amendment, acceleration or cancellation (with or without notice, lapse of time or both) of, any agreement, credit facility, debt or other instrument (evidencing a Company or Subsidiary debt or otherwise) or other understanding to which the Company or any Subsidiary is a party or by which any property or asset of the Company or any Subsidiary is bound or affected, or (iii) subject to the Required Approvals, conflict with or result in a violation of any law, rule, regulation, order, judgment, injunction, decree or other restriction of any court or governmental authority to which the Company or a Subsidiary is subject (including federal and state securities laws and regulations), or by which any property or asset of the Company or a Subsidiary is bound or affected; except in the case of each of clauses (ii) and (iii), such as could not have or reasonably be expected to result in a Material Adverse Effect.

(e)Filings, Consents and Approvals.  The Company is not required to obtain any consent, waiver, authorization or order of, give any notice to, or make any filing or registration with, any court or other federal, state, local or other governmental authority or other Person in connection with the execution, delivery and performance by the Company of the Transaction Documents, other than: (i) the filings required pursuant to Section 4.3 of this Agreement, (ii) the filing with the Commission of the Prospectus Supplement, (iii) application(s) to each applicable Trading Market for the listing of the Shares for trading thereon in the time and manner required thereby, and (iv) such filings as are required to be made under applicable state securities laws (collectively, the “Required Approvals”).

(f)Issuance of the Shares; Registration.  The Shares are duly authorized and, when issued and paid for in accordance with the applicable Transaction Documents, will be duly and validly issued, fully paid and nonassessable, free and clear of all Liens imposed by the Company.  The Company has reserved from its duly authorized capital stock the maximum number of shares of Common Stock issuable pursuant to this Agreement. The Company has prepared and filed the Registration Statement in conformity with the requirements of the Securities Act, which became effective on May 24, 2018 (the “Effective Date”), including the Prospectus, and such amendments and supplements thereto as may have been required to the date of this Agreement.  The Registration Statement is effective under the Securities Act and no stop order preventing 

8

 

or suspending the effectiveness of the Registration Statement or suspending or preventing the use of the Prospectus has been issued by the Commission and no proceedings for that purpose have been instituted or, to the knowledge of the Company, are threatened by the Commission.  The Company, if required by the rules and regulations of the Commission, shall file the Prospectus with the Commission pursuant to Rule 424(b).  At the time the Registration Statement and any amendments thereto became effective, at the date of this Agreement and at the Closing Date, the Registration Statement and any amendments thereto conformed and will conform in all material respects to the requirements of the Securities Act and did not and will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading; and the Prospectus and any amendments or supplements thereto, at the time the Prospectus or any amendment or supplement thereto was issued and at the Closing Date, conformed and will conform in all material respects to the requirements of the Securities Act and did not and will not contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. The Company was at the time of the filing of the Registration Statement eligible to use Form S-3. The Company is eligible to use Form S-3 under the Securities Act and it meets the transaction requirements with respect to the aggregate market value of securities being sold pursuant to this offering and during the twelve (12) months prior to this offering, as set forth in General Instruction I.B.6 of Form S-3.

(g)Capitalization.  The capitalization of the Company as of the date hereof is as set forth on Schedule 3.1(g).  The Company has not issued any capital stock since its most recently filed periodic report under the Exchange Act, other than pursuant to the exercise of employee stock options under the Company’s stock option plans, the issuance of shares of Common Stock to employees pursuant to the Company’s employee stock purchase plans and pursuant to the conversion and/or exercise of Common Stock Equivalents outstanding as of the date of the most recently filed periodic report under the Exchange Act.  No Person has any right of first refusal, preemptive right, right of participation, or any similar right to participate in the transactions contemplated by the Transaction Documents, except such rights which have been waived prior to the date hereof.  Except as a result of the purchase and sale of the Shares, there are no outstanding options, warrants, scrip rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities, rights or obligations convertible into or exercisable or exchangeable for, or giving any Person any right to subscribe for or acquire, any shares of Common Stock or the capital stock of any Subsidiary, or contracts, commitments, understandings or arrangements by which the Company or any Subsidiary is or may become bound to issue additional shares of Common Stock or Common Stock Equivalents or capital stock of any Subsidiary.  The issuance and sale of the Shares will not obligate the Company or any Subsidiary to issue shares of Common Stock or other securities to any Person (other than the Purchasers). Except as set forth on Schedule 3.1(g), there are no outstanding securities or instruments of the Company or any Subsidiary with any provision that adjusts the exercise, conversion, exchange or reset price of such security or instrument upon an issuance of securities by the Company or any Subsidiary. There are no outstanding securities or instruments of the Company or any Subsidiary that contain any redemption or similar provisions, and there are no contracts, 

9

 

commitments, understandings or arrangements by which the Company or any Subsidiary is or may become bound to redeem a security of the Company or such Subsidiary. The Company does not have any stock appreciation rights or “phantom stock” plans or agreements or any similar plan or agreement. All of the outstanding shares of capital stock of the Company are duly authorized, validly issued, fully paid and nonassessable, have been issued in compliance with all federal and state securities laws, and none of such outstanding shares was issued in violation of any preemptive rights or similar rights to subscribe for or purchase securities.  No further approval or authorization of any stockholder, the Board of Directors or others is required for the issuance and sale of the Shares.  Except as set forth on Schedule 3.1(g), there are no stockholders agreements, voting agreements or other similar agreements with respect to the Company’s capital stock to which the Company is a party or, to the knowledge of the Company, between or among any of the Company’s stockholders.

(h)SEC Reports; Financial Statements.  The Company has filed all reports, schedules, forms, statements and other documents required to be filed by the Company under the Securities Act and the Exchange Act, including pursuant to Section 13(a) or 15(d) thereof, for the two years preceding the date hereof (or such shorter period as the Company was required by law or regulation to file such material) (the foregoing materials, including the exhibits thereto and documents incorporated by reference therein, together with the Registration Statement, Prospectus and the Prospectus Supplement, being collectively referred to herein as the “SEC Reports”) on a timely basis or has received a valid extension of such time of filing and has filed any such SEC Reports prior to the expiration of any such extension.  As of their respective dates, the SEC Reports complied in all material respects with the requirements of the Securities Act and the Exchange Act, as applicable, and none of the SEC Reports, when filed, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. The Company has never been an issuer subject to Rule 144(i) under the Securities Act. The financial statements of the Company included in the SEC Reports comply in all material respects with applicable accounting requirements and the rules and regulations of the Commission with respect thereto as in effect at the time of filing.  Such financial statements have been prepared in accordance with United States generally accepted accounting principles applied on a consistent basis during the periods involved (“GAAP”), except as may be otherwise specified in such financial statements or the notes thereto and except that unaudited financial statements may not contain all footnotes required by GAAP, and fairly present in all material respects the financial position of the Company and its consolidated Subsidiaries as of and for the dates thereof and the results of operations and cash flows for the periods then ended, subject, in the case of unaudited statements, to normal, immaterial, year-end audit adjustments.

(i)Material Changes; Undisclosed Events, Liabilities or Developments.  Since the date of the latest audited financial statements included within the SEC Reports, except as set forth on Schedule 3.1(i), (i) there has been no event, occurrence or development that has had or that could reasonably be expected to result in a Material Adverse Effect, (ii) the Company has not incurred any liabilities (contingent or 

10

 

otherwise) other than (A) trade payables and accrued expenses incurred in the ordinary course of business consistent with past practice and (B) liabilities not required to be reflected in the Company’s financial statements pursuant to GAAP or disclosed in filings made with the Commission, (iii) the Company has not altered its method of accounting, (iv) the Company has not declared or made any dividend or distribution of cash or other property to its stockholders or purchased, redeemed or made any agreements to purchase or redeem any shares of its capital stock and (v) the Company has not issued any equity securities to any officer, director or Affiliate, except pursuant to existing Company stock option plans and the issuance of Common Stock Equivalents as disclosed in the SEC Reports.  The Company does not have pending before the Commission any request for confidential treatment of information.  Except for the issuance of the Shares contemplated by this Agreement or as set forth on Schedule 3.1(i), no event, liability, fact, circumstance, occurrence or development has occurred or exists or is reasonably expected to occur or exist with respect to the Company or its Subsidiaries or their respective businesses, prospects, properties, operations, assets or financial condition that would be required to be disclosed by the Company under applicable securities laws at the time this representation is made or deemed made that has not been publicly disclosed at least 1 Trading Day prior to the date that this representation is made.

(j)Litigation.  Except as set forth on Schedule 3.1(j), there is not, and to the knowledge of the Company there is not pending or contemplated, any action, suit, inquiry, notice of violation, proceeding or investigation, or to the knowledge of the Company, threatened against or affecting the Company, any Subsidiary or any of their respective properties before or by any court, arbitrator, governmental or administrative agency or regulatory authority (federal, state, county, local or foreign) (collectively, an “Action”).  None of the Actions listed on Schedule 3.1(j) (i) adversely affect or challenge the legality, validity or enforceability of any of the Transaction Documents or the Shares or (ii) could, if there were an unfavorable decision, have or reasonably be expected to result in a Material Adverse Effect.  Neither the Company nor any Subsidiary, nor, to the Company’s knowledge, any director or officer thereof, is or has been the subject of any Action involving a claim of violation of or liability under federal or state securities laws or a claim of breach of fiduciary duty.  To the knowledge of the Company, there has not been, and there is not pending or contemplated, any investigation by the Commission involving the Company or any current or former director or officer of the Company.  The Commission has not issued any stop order or other order suspending the effectiveness of any registration statement filed by the Company or any Subsidiary under the Exchange Act or the Securities Act.  

(k)Labor Relations.  No labor dispute exists or, to the knowledge of the Company, is imminent with respect to any of the employees of the Company, which could reasonably be expected to result in a Material Adverse Effect.  None of the Company’s or its Subsidiaries’ employees is a member of a union that relates to such employee’s relationship with the Company or such Subsidiary, and neither the Company nor any of its Subsidiaries is a party to a collective bargaining agreement, and the Company and its Subsidiaries believe that their relationships with their employees are good.  To the knowledge of the Company, no executive officer of the Company or any Subsidiary, is, or is now expected to be, in violation of any material term of any 

11

 

employment contract, confidentiality, disclosure or proprietary information agreement or non-competition agreement, or any other contract or agreement or any restrictive covenant in favor of any third party, and the continued employment of each such executive officer does not subject the Company or any of its Subsidiaries to any liability with respect to any of the foregoing matters that would reasonably be expected to have a Material Adverse Effect.  The Company and its Subsidiaries are in compliance with all U.S. federal, state, local and foreign laws and regulations relating to employment and employment practices, terms and conditions of employment and wages and hours, except where the failure to be in compliance could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

(l)Compliance.  Neither the Company nor any Subsidiary: (i) is in default under or in violation of (and no event has occurred that has not been waived that, with notice or lapse of time or both, would result in a default by the Company or any Subsidiary under), nor has the Company or any Subsidiary received notice of a claim that it is in default under or that it is in violation of, any indenture, loan or credit agreement or any other agreement or instrument to which it is a party or by which it or any of its properties is bound (whether or not such default or violation has been waived), (ii) is in violation of any judgment, decree or order of any court, arbitrator or other governmental authority or (iii) is or has been in violation of any statute, rule, ordinance or regulation of any governmental authority, including without limitation all foreign, federal, state and local laws relating to taxes, environmental protection, occupational health and safety, product quality and safety and employment and labor matters, except in each case as could not have or reasonably be expected to result in a Material Adverse Effect.

(m)Environmental Laws.The Company and its Subsidiaries (i) are in compliance with all federal, state, local and foreign laws relating to pollution or protection of human health or the environment (including ambient air, surface water, groundwater, land surface or subsurface strata), including laws relating to emissions, discharges, releases or threatened releases of chemicals, pollutants, contaminants, or toxic or hazardous substances or wastes (collectively, “Hazardous Materials”) into the environment, or otherwise relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Hazardous Materials, as well as all authorizations, codes, decrees, demands, or demand letters, injunctions, judgments, licenses, notices or notice letters, orders, permits, plans or regulations, issued, entered, promulgated or approved thereunder (“Environmental Laws”); (ii) have received all permits licenses or other approvals required of them under applicable Environmental Laws to conduct their respective businesses; and (iii) are in compliance with all terms and conditions of any such permit, license or approval where in each clause (i), (ii) and (iii), the failure to so comply could be reasonably expected to have, individually or in the aggregate, a Material Adverse Effect.

(n)Regulatory Permits.  The Company and the Subsidiaries possess all certificates, authorizations and permits issued by the appropriate federal, state, local or foreign regulatory authorities, including, without limitation, those administered by the U.S. Food and Drug Administration (“FDA”) of the U.S. Department of Health and Human Services, the Centers for Medicare & Medicaid Services (“CMA”), or by any 

12

 

foreign, federal, state or local governmental or regulatory authority performing functions similar to those performed by the FDA or CMS necessary to conduct their respective businesses as described in the SEC Reports, except where the failure to possess such permits could not reasonably be expected to result in a Material Adverse Effect (“Material Permits”), and neither the Company nor any Subsidiary has received any notice of proceedings relating to the revocation or modification of any Material Permit.

(o)Title to Assets.  The Company and the Subsidiaries have good and marketable title in fee simple to all real property owned by them and good and marketable title in all personal property owned by them that is material to the business of the Company and the Subsidiaries, in each case free and clear of all Liens, except for (i) Liens as do not materially affect the value of such property and do not materially interfere with the use made and proposed to be made of such property by the Company and the Subsidiaries and (ii) Liens for the payment of federal, state or other taxes, for which appropriate reserves have been made therefor in accordance with GAAP and, the payment of which is neither delinquent nor subject to penalties.  Any real property and facilities held under lease by the Company and the Subsidiaries are held by them under valid, subsisting and enforceable leases with which the Company and the Subsidiaries are in compliance.

(p)Intellectual Property.  The Company and the Subsidiaries have, or have rights to use, all patents, patent applications, trademarks, trademark applications, service marks, trade names, trade secrets, inventions, copyrights, licenses and other intellectual property rights and similar rights necessary or required for use in connection with their respective businesses as described in the SEC Reports and which the failure to so have could have a Material Adverse Effect (collectively, the “Intellectual Property Rights”).  None of, and neither the Company nor any Subsidiary has received a notice (written or otherwise) that any of, the Intellectual Property Rights has expired, terminated or been abandoned, or is expected to expire or terminate or be abandoned, within two (2) years from the date of this Agreement, except where such action would not reasonably be expected to have a Material Adverse Effect.  Neither the Company nor any Subsidiary has received, since the date of the latest audited financial statements included within the SEC Reports, a written notice of a claim or otherwise has any knowledge that the Intellectual Property Rights violate or infringe upon the rights of any Person, except as could not have or reasonably be expected to not have a Material Adverse Effect.  To the knowledge of the Company, all such Intellectual Property Rights are enforceable and there is no existing infringement by another Person of any of the Intellectual Property Rights.  The Company and its Subsidiaries have taken reasonable security measures to protect the secrecy, confidentiality and value of all of their intellectual properties, except where failure to do so could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

(q)Insurance.  The Company and the Subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as are prudent and customary in the businesses in which the Company and the Subsidiaries are engaged, including, but not limited to, directors and officers insurance coverage at least equal to the aggregate Subscription Amount.  Neither the Company nor any 

13

 

Subsidiary has any reason to believe that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business without a significant increase in cost.

(r)Transactions With Affiliates and Employees.  Except as set forth on Schedule 3.1(r), none of the officers or directors of the Company or any Subsidiary and, to the knowledge of the Company, none of the employees of the Company or any Subsidiary is presently a party to any transaction with the Company or any Subsidiary (other than for services as employees, officers and directors), including any contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental of real or personal property to or from, providing for the borrowing of money from or lending of money to or otherwise requiring payments to or from any officer, director or such employee or, to the knowledge of the Company, any entity in which any officer, director, or any such employee has a substantial interest or is an officer, director, trustee, stockholder, member or partner, in each case in excess of $120,000 other than for (i) payment of salary or consulting fees for services rendered, (ii) reimbursement for expenses incurred on behalf of the Company and (iii) other employee benefits, including stock option agreements under any stock option plan of the Company.

(s)Sarbanes-Oxley; Internal Accounting Controls.  The Company and the Subsidiaries are in material compliance with any and all applicable requirements of the Sarbanes-Oxley Act of 2002 that are effective as of the date hereof, and any and all applicable rules and regulations promulgated by the Commission thereunder that are effective as of the date hereof and as of the Closing Date.  The Company and the Subsidiaries maintain a system of internal accounting controls sufficient to provide reasonable assurance that: (i) transactions are executed in accordance with management’s general or specific authorizations, (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain asset accountability, (iii) access to assets is permitted only in accordance with management’s general or specific authorization, and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences. The Company and the Subsidiaries have established disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Company and the Subsidiaries and designed such disclosure controls and procedures to ensure that information required to be disclosed by the Company in the reports it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms.  The Company’s certifying officers have evaluated the effectiveness of the disclosure controls and procedures of the Company and the Subsidiaries as of the end of the period covered by the most recently filed periodic report under the Exchange Act (such date, the “Evaluation Date”).  The Company presented in its most recently filed periodic report under the Exchange Act the conclusions of the certifying officers about the effectiveness of the disclosure controls and procedures based on their evaluations as of the Evaluation Date.  Since the Evaluation Date, there have been no changes in the internal control over financial reporting (as such term is defined in the Exchange Act) of the Company and its 

14

 

Subsidiaries that have materially affected, or is reasonably likely to materially affect, the internal control over financial reporting of the Company and its Subsidiaries.

(t)Certain Fees.  Except as set forth in the Prospectus Supplement, no brokerage or finder’s fees or commissions are or will be payable by the Company or any Subsidiary to any broker, financial advisor or consultant, finder, placement agent, investment banker, bank or other Person with respect to the transactions contemplated by the Transaction Documents.  The Purchasers shall have no obligation with respect to any fees or with respect to any claims made by or on behalf of other Persons for fees of a type contemplated in this Section that may be due in connection with the transactions contemplated by the Transaction Documents.

(u)Investment Company. The Company is not, and is not an Affiliate of, and immediately after receipt of payment for the Shares, will not be or be an Affiliate of, an “investment company” within the meaning of the Investment Company Act of 1940, as amended.  The Company shall conduct its business in a manner so that it will not become an “investment company” subject to registration under the Investment Company Act of 1940, as amended.

(v)Registration Rights.  Except as set forth on Schedule 3.1(v), no Person has any right to cause the Company or any Subsidiary to effect the registration under the Securities Act of any securities of the Company or any Subsidiary.

(w)Listing and Maintenance Requirements.  The Common Stock is registered pursuant to Section 12(b) or 12(g) of the Exchange Act, and the Company has taken no action designed to, or which to its knowledge is likely to have the effect of, terminating the registration of the Common Stock under the Exchange Act nor has the Company received any notification that the Commission is contemplating terminating such registration.  Except as set forth on Schedule 3.1(w), the Company has not, in the 12 months preceding the date hereof, received notice from any Trading Market on which the Common Stock is or has been listed or quoted to the effect that the Company is not in compliance with the listing or maintenance requirements of such Trading Market. Except as set forth on Schedule 3.1(w), the Company is, and has no reason to believe that it will not in the foreseeable future continue to be, in compliance with all such listing and maintenance requirements. The Common Stock is currently eligible for electronic transfer through the Depository Trust Company or another established clearing corporation and the Company is current in payment of the fees to the Depository Trust Company (or such other established clearing corporation) in connection with such electronic transfer.

(x)Application of Takeover Protections.  The Company and the Board of Directors have taken all necessary action, if any, in order to render inapplicable any control share acquisition, business combination, poison pill (including any distribution under a rights agreement) or other similar anti‐takeover provision under the Company’s certificate of incorporation (or similar charter documents) or the laws of its state of incorporation that is or could become applicable to the Purchasers as a result of the Purchasers and the Company fulfilling their obligations or exercising their rights under 

15

 

the Transaction Documents, including without limitation as a result of the Company’s issuance of the Shares and the Purchasers’ ownership of the Shares.

(y)Disclosure.  Except with respect to the material terms and conditions of the transactions contemplated by the Transaction Documents, the Company confirms that neither it nor any other Person acting on its behalf has provided any of the Purchasers or their agents or counsel with any information that it believes constitutes or might constitute material, non-public information which is not otherwise disclosed in the Prospectus Supplement.   The Company understands and confirms that the Purchasers will rely on the foregoing representation in effecting transactions in securities of the Company.  All of the disclosure furnished by or on behalf of the Company to the Purchasers regarding the Company and its Subsidiaries, their respective businesses and the transactions contemplated hereby, including the Disclosure Schedules to this Agreement, is true and correct and does not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading. The press releases disseminated by the Company during the twelve months preceding the date of this Agreement taken as a whole do not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made and when made, not misleading.  The Company acknowledges and agrees that no Purchaser makes or has made any representations or warranties with respect to the transactions contemplated hereby other than those specifically set forth in Section 3.2 hereof.

(z)No Integrated Offering. Assuming the accuracy of the Purchasers’ representations and warranties set forth in Section 3.2, neither the Company, nor any of its Affiliates, nor any Person acting on its or their behalf has, directly or indirectly, made any offers or sales of any security or solicited any offers to buy any security, under circumstances that would cause this offering of the Shares to be integrated with prior offerings by the Company for purposes of any applicable shareholder approval provisions of any Trading Market on which any of the securities of the Company are listed or designated.

(aa)Solvency.  Except as set forth on Schedule 3.1(aa), based on the consolidated financial condition of the Company as of the Closing Date, after giving effect to the receipt by the Company of the proceeds from the sale of the Shares hereunder, (i) the fair saleable value of the Company’s assets exceeds the amount that will be required to be paid on or in respect of the Company’s existing debts and other liabilities (including known contingent liabilities) as they mature, (ii) the Company’s assets do not constitute unreasonably small capital to carry on its business as now conducted and as proposed to be conducted including its capital needs taking into account the particular capital requirements of the business conducted by the Company, consolidated and projected capital requirements and capital availability thereof, and (iii) the current cash flow of the Company, together with the proceeds the Company would receive, were it to liquidate all of its assets, after taking into account all anticipated uses of the cash, would be sufficient to pay all amounts on or in respect of its liabilities when 

16

 

such amounts are required to be paid.  The Company does not intend to incur debts beyond its ability to pay such debts as they mature (taking into account the timing and amounts of cash to be payable on or in respect of its debt).  The Company has no knowledge of any facts or circumstances which lead it to believe that it will file for reorganization or liquidation under the bankruptcy or reorganization laws of any jurisdiction within one year from the Closing Date.  Schedule 3.1(aa) sets forth as of the date hereof all outstanding secured and unsecured Indebtedness of the Company or any Subsidiary, or for which the Company or any Subsidiary has commitments.  Neither the Company nor any Subsidiary is in default with respect to any Indebtedness. For the purposes of this Agreement, “Indebtedness” means (x) any liabilities for borrowed money or amounts owed in excess of $50,000 (other than trade accounts payable incurred in the ordinary course of business), (y) all guaranties, endorsements and other contingent obligations in respect of indebtedness of others, whether or not the same are or should be reflected in the Company’s consolidated balance sheet (or the notes thereto), except guaranties by endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business; and (z) the present value of any lease payments in excess of $50,000 due under leases required to be capitalized in accordance with GAAP.

(bb)Tax Status.  Except for matters that would not, individually or in the aggregate, have or reasonably be expected to result in a Material Adverse Effect, the Company and its Subsidiaries each (i) has made or filed all United States federal, state and local income and all foreign income and franchise tax returns, reports and declarations required by any jurisdiction to which it is subject, (ii) has paid all taxes and other governmental assessments and charges that are material in amount, shown or determined to be due on such returns, reports and declarations and (iii) has set aside on its books provision reasonably adequate for the payment of all material taxes for periods subsequent to the periods to which such returns, reports or declarations apply.  There are no unpaid taxes in any material amount claimed to be due by the taxing authority of any jurisdiction, and the officers of the Company or of any Subsidiary know of no basis for any such claim.

(cc)Foreign Corrupt Practices.  Neither the Company nor any Subsidiary, nor to the knowledge of the Company or any Subsidiary, any agent or other person acting on behalf of the Company or any Subsidiary, has (i) directly or indirectly, used any funds for unlawful contributions, gifts, entertainment or other unlawful expenses related to foreign or domestic political activity, (ii) made any unlawful payment to foreign or domestic government officials or employees or to any foreign or domestic political parties or campaigns from corporate funds, (iii) failed to disclose fully any contribution made by the Company or any Subsidiary (or made by any person acting on its behalf of which the Company is aware) which is in violation of law, or (iv) violated in any material respect any provision of FCPA.

(dd)Accountants.  The Company’s accounting firm is set forth in the SEC Reports.  To the knowledge and belief of the Company, the Company’s accounting firm (i) is a registered public accounting firm as required by the Exchange Act and (ii) shall 

17

 

express its opinion with respect to the financial statements to be included in the Company’s Annual Report for the fiscal year ending December 31, 2018.

(ee) Acknowledgment Regarding Purchasers’ Purchase of Shares.  The Company acknowledges and agrees that each of the Purchasers is acting solely in the capacity of an arm’s length purchaser with respect to the Transaction Documents and the transactions contemplated thereby.  The Company further acknowledges that no Purchaser is acting as a financial advisor or fiduciary of the Company (or in any similar capacity) with respect to the Transaction Documents and the transactions contemplated thereby and any advice given by any Purchaser or any of their respective representatives or agents in connection with the Transaction Documents and the transactions contemplated thereby is merely incidental to the Purchasers’ purchase of the Shares.  The Company further represents to each Purchaser that the Company’s decision to enter into this Agreement and the other Transaction Documents has been based solely on the independent evaluation of the transactions contemplated hereby by the Company and its representatives.

(ff)Acknowledgment Regarding Purchaser’s Trading Activity.  Anything in this Agreement or elsewhere herein to the contrary notwithstanding (except for Sections 3.2(f) and 4.14 hereof), it is understood and acknowledged by the Company that: (i) none of the Purchasers has been asked by the Company to agree, nor has any Purchaser agreed, to desist from purchasing or selling, long and/or short, securities of the Company, or “derivative” securities based on securities issued by the Company or to hold the Shares for any specified term; (ii) past or future open market or other transactions by any Purchaser, specifically including, without limitation, Short Sales or “derivative” transactions, before or after the closing of this or future private placement transactions, may negatively impact the market price of the Company’s publicly-traded securities; (iii) any Purchaser, and counter-parties in “derivative” transactions to which any such Purchaser is a party, directly or indirectly, presently may have a “short” position in the Common Stock, and (iv) each Purchaser shall not be deemed to have any affiliation with or control over any arm’s length counter-party in any “derivative” transaction.  The Company further understands and acknowledges that (y) one or more Purchasers may engage in hedging activities at various times during the period that the Shares are outstanding, and (z) such hedging activities (if any) could reduce the value of the existing stockholders' equity interests in the Company at and after the time that the hedging activities are being conducted.  The Company acknowledges that such aforementioned hedging activities do not constitute a breach of any of the Transaction Documents.

(gg)Regulation M Compliance.  Except as set forth on Schedule 3.1(gg), the Company has not, and to its knowledge no one acting on its behalf has, (i) taken, directly or indirectly, any action designed to cause or to result in the stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of any of the Shares, (ii) sold, bid for, purchased, or, paid any compensation for soliciting purchases of, any of the Shares, or (iii) paid or agreed to pay to any Person any compensation for soliciting another to purchase any other securities of the Company, other than, in the case of clauses (ii) and (iii), compensation paid to the Company’s placement agent in connection with the placement of the Shares.

18

 

(hh)Regulatory.  All preclinical and clinical studies conducted by or on behalf of the Company that are material to the Company and its Subsidiaries, taken as a whole, are or have been adequately described in the SEC Reports in all material respects.  The clinical and preclinical studies conducted by or on behalf of the Company and its Subsidiaries that are described in the SEC Reports or the results of which are referred to in the SEC Reports were and, if still ongoing, are being conducted in material compliance with all laws and regulations applicable thereto in the jurisdictions in which they are being conducted.  The descriptions in the SEC Reports of the results of such studies are accurate and complete in all material respects and fairly present the data derived from such studies, and the Company has no knowledge of, or reason to believe that, any clinical study the aggregate results of which are inconsistent with or otherwise call into question the results of any clinical study conducted by or on behalf of the Company and its Subsidiaries that are described in the SEC Reports or the results of which are referred to in the SEC Reports.  Except as disclosed in the SEC Reports, the Company has not received any written notices or statements from the U.S. Food and Drug Administration, the European Medicines Agency or any other governmental agency or authority requiring, requesting or suggesting  termination, suspension or material modification for or of any clinical or preclinical studies that are described in the SEC Reports or the results of which are referred to in the SEC Reports.  Except as disclosed in the SEC Reports, the Company has not received any written notices or statements from any governmental agency, and otherwise has no knowledge of, or reason to believe that any license, approval, permit or authorization to conduct any clinical trial of any potential product of the Company has been, will be or may be suspended, revoked, modified or limited. 

(ii)Stock Option Plans. Each stock option granted by the Company under the Company’s stock option plan was granted (i) in accordance with the terms of the Company’s stock option plan and (ii) with an exercise price at least equal to the fair market value of the Common Stock on the date such stock option would be considered granted under GAAP and applicable law. No stock option granted under the Company’s stock option plan has been backdated.  The Company has not knowingly granted, and there is no and has been no Company policy or practice to knowingly grant, stock options prior to, or otherwise knowingly coordinate the grant of stock options with, the release or other public announcement of material information regarding the Company or its Subsidiaries or their financial results or prospects.

(jj)Office of Foreign Assets Control.  Neither the Company nor any Subsidiary nor, to the Company's knowledge, any director, officer, agent, employee or affiliate of the Company  or any Subsidiary is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department (“OFAC”).

(kk)U.S. Real Property Holding Corporation.  The Company is not and has never been a U.S. real property holding corporation within the meaning of Section 897 of the Internal Revenue Code of 1986, as amended, and the Company shall so certify upon Purchaser’s request.

19

 

(ll)Bank Holding Company Act.  Neither the Company nor any of its Subsidiaries or Affiliates is subject to the Bank Holding Company Act of 1956, as amended (the “BHCA”) and to regulation by the Board of Governors of the Federal Reserve System (the “Federal Reserve”).  Neither the Company nor any of its Subsidiaries or Affiliates owns or controls, directly or indirectly, five percent (5%) or more of the outstanding shares of any class of voting securities or twenty-five percent or more of the total equity of a bank or any entity that is subject to the BHCA and to regulation by the Federal Reserve.  Neither the Company nor any of its Subsidiaries or Affiliates exercises a controlling influence over the management or policies of a bank or any entity that is subject to the BHCA and to regulation by the Federal Reserve.

(mm)Money Laundering.  The operations of the Company and its Subsidiaries are and have been conducted at all times in compliance with applicable financial record-keeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, applicable money laundering statutes and applicable rules and regulations thereunder (collectively, the “Money Laundering Laws”), and no Action or Proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or any Subsidiary with respect to the Money Laundering Laws is pending or, to the knowledge of the Company or any Subsidiary, threatened.

3.2Representations and Warranties of the Purchasers.  Each Purchaser, for itself and for no other Purchaser, hereby represents and warrants as of the date hereof and as of the Closing Date to the Company as follows (unless as of a specific date therein, in which case they shall be accurate as of such date):

(a)Organization; Authority.  Such Purchaser is either an individual or an entity duly incorporated or formed, validly existing and in good standing under the laws of the jurisdiction of its incorporation or formation with full right, corporate, partnership, limited liability company or similar power and authority to enter into and to consummate the transactions contemplated by the Transaction Documents and otherwise to carry out its obligations hereunder and thereunder. The execution and delivery of the Transaction Documents and performance by such Purchaser of the transactions contemplated by the Transaction Documents have been duly authorized by all necessary corporate, partnership, limited liability company or similar action, as applicable, on the part of such Purchaser.  Each Transaction Document to which it is a party has been duly executed by such Purchaser, and when delivered by such Purchaser in accordance with the terms hereof, will constitute the valid and legally binding obligation of such Purchaser, enforceable against it in accordance with its terms, except: (i) as limited by general equitable principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies and (iii) insofar as indemnification and contribution provisions may be limited by applicable law.

(b)Understandings or Arrangements.  Such Purchaser is acquiring the Shares as principal for its own account and has no direct or indirect arrangement or understandings with any other persons to distribute or regarding the distribution of such Shares (this 

20

 

representation and warranty not limiting such Purchaser’s right to sell the Shares pursuant to the Registration Statement or otherwise in compliance with applicable federal and state securities laws).  Such Purchaser is acquiring the Shares hereunder in the ordinary course of its business.

(c)Purchaser Status.  At the time such Purchaser was offered the Shares, it was, and as of the date hereof it is either: (i) an “accredited investor” as defined in Rule 501(a)(1), (a)(2), (a)(3), (a)(7) or (a)(8) under the Securities Act or (ii) a “qualified institutional buyer” as defined in Rule 144A(a) under the Securities Act.  

(d)Experience of Such Purchaser.  Such Purchaser, either alone or together with its representatives, has such knowledge, sophistication and experience in business and financial matters so as to be capable of evaluating the merits and risks of the prospective investment in the Shares, and has so evaluated the merits and risks of such investment.  Such Purchaser is able to bear the economic risk of an investment in the Shares and, at the present time, is able to afford a complete loss of such investment.

(e)Access to Information. Such Purchaser acknowledges that it has had the opportunity to review the Transaction Documents (including all exhibits and schedules thereto) and the SEC Reports and has been afforded, (i) the opportunity to ask such questions as it has deemed necessary of, and to receive answers from, representatives of the Company concerning the terms and conditions of the offering of the Shares and the merits and risks of investing in the Shares; (ii) access to information about the Company and its financial condition, results of operations, business, properties, management and prospects sufficient to enable it to evaluate its investment; and (iii) the opportunity to obtain such additional information that the Company possesses or can acquire without unreasonable effort or expense that is necessary to make an informed investment decision with respect to the investment.  Such Purchaser acknowledges and agrees that neither the Placement Agent nor any Affiliate of the Placement Agent has provided such Purchaser with any information or advice with respect to the Shares nor is such information or advice necessary or desired.  Neither the Placement Agent nor any Affiliate has made or makes any representation as to the Company or the quality of the Shares and the Placement Agent and any Affiliate may have acquired non-public information with respect to the Company which such Purchaser agrees need not be provided to it.  In connection with the issuance of the Shares to such Purchaser, neither the Placement Agent nor any of its Affiliates has acted as a financial advisor or fiduciary to such Purchaser.

(f)Certain Transactions and Confidentiality.  Other than consummating the transactions contemplated hereunder, such Purchaser has not, nor has any Person acting on behalf of or pursuant to any understanding with such Purchaser, directly or indirectly executed any purchases or sales, including Short Sales, of the securities of the Company during the period commencing as of the time that such Purchaser first received a term sheet (written or oral) from the Company or any other Person representing the Company setting forth the material pricing terms of the transactions contemplated hereunder and ending immediately prior to the execution hereof.  Notwithstanding the foregoing, in the case of a Purchaser that is a multi-managed investment vehicle whereby separate portfolio managers manage separate portions of such Purchaser’s assets and the portfolio managers have no 

21

 

direct knowledge of the investment decisions made by the portfolio managers managing other portions of such Purchaser’s assets, the representation set forth above shall only apply with respect to the portion of assets managed by the portfolio manager that made the investment decision to purchase the Shares covered by this Agreement.  Other than to other Persons party to this Agreement or to such Purchaser’s representatives, including, without limitation, its officers, directors, partners, legal and other advisors, employees, agents and Affiliates, such Purchaser has maintained the confidentiality of all disclosures made to it in connection with this transaction (including the existence and terms of this transaction). Notwithstanding the foregoing, for the avoidance of doubt, nothing contained herein shall constitute a representation or warranty, or preclude any actions, with respect to locating or borrowing shares in order to effect Short Sales or similar transactions in the future.

The Company acknowledges and agrees that the representations contained in this Section 3.2 shall not modify, amend or affect such Purchaser’s right to rely on the Company’s representations and warranties contained in this Agreement or any representations and warranties contained in any other Transaction Document or any other document or instrument executed and/or delivered in connection with this Agreement or the consummation of the transactions contemplated hereby.  Notwithstanding the foregoing, for the avoidance of doubt, nothing contained herein shall constitute a representation or warranty, or preclude any actions, with respect to locating or borrowing shares in order to effect Short Sales or similar transactions in the future.

ARTICLE IV.
OTHER AGREEMENTS OF THE PARTIES

4.1Furnishing of Information.  Until the time that no Purchaser owns Shares, the Company covenants to timely file (or obtain extensions in respect thereof and file within the applicable grace period) all reports required to be filed by the Company after the date hereof pursuant to the Exchange Act even if the Company is not then subject to the reporting requirements of the Exchange Act.  

4.2Integration.  The Company shall not sell, offer for sale or solicit offers to buy or otherwise negotiate in respect of any security (as defined in Section 2 of the Securities Act) that would be integrated with the offer or sale of the Shares for purposes of the rules and regulations of any Trading Market such that it would require shareholder approval prior to the closing of such other transaction unless shareholder approval is obtained before the closing of such subsequent transaction. 

4.3Securities Laws Disclosure; Publicity.  The Company shall (a) by the Disclosure Time, issue a press release disclosing the material terms of the transactions contemplated hereby, and (b) file a Current Report on Form 8-K, including the Transaction Documents as exhibits thereto, with the Commission within the time required by the Exchange Act.  From and after the issuance of such press release, the Company represents to the Purchasers that it shall have publicly disclosed all material, non-public information delivered to any of the Purchasers by the Company or any of its Subsidiaries, or any of their respective officers, directors, employees or agents in connection with the transactions contemplated by the Transaction Documents.  In addition, effective upon the issuance of such press release, the Company acknowledges and 

22

 

agrees that any and all confidentiality or similar obligations under any agreement, whether written or oral, between the Company, any of its Subsidiaries or any of their respective officers, directors, agents, employees or Affiliates on the one hand, and any of the Purchasers or any of their Affiliates on the other hand, shall terminate. The Company and each Purchaser shall consult with each other in issuing any other press releases with respect to the transactions contemplated hereby, and neither the Company nor any Purchaser shall issue any such press release nor otherwise make any such public statement without the prior consent of the Company, with respect to any press release of any Purchaser, or without the prior consent of each Purchaser, with respect to any press release of the Company, which consent shall not unreasonably be withheld or delayed, except if such disclosure is required by law, in which case the disclosing party shall promptly provide the other party with prior notice of such public statement or communication.  Notwithstanding the foregoing, the Company shall not publicly disclose the name of any Purchaser, or include the name of any Purchaser in any filing with the Commission or any regulatory agency or Trading Market, without the prior written consent of such Purchaser, except (a) as required by federal securities law in connection with the filing of final Transaction Documents with the Commission and (b) to the extent such disclosure is required by law or Trading Market regulations, in which case the Company shall provide the Purchasers with prior notice of such disclosure permitted under this clause (b).

4.4Shareholder Rights Plan.  No claim will be made or enforced by the Company or, with the consent of the Company, any other Person, that any Purchaser is an “Acquiring Person” under any control share acquisition, business combination, poison pill (including any distribution under a rights agreement) or similar anti-takeover plan or arrangement in effect or hereafter adopted by the Company, or that any Purchaser could be deemed to trigger the provisions of any such plan or arrangement, by virtue of receiving Shares under the Transaction Documents or under any other agreement between the Company and the Purchasers.

4.5Non-Public Information.   Except with respect to the material terms and conditions of the transactions contemplated by the Transaction Documents, which shall be disclosed pursuant to Section 4.3, the Company covenants and agrees that neither it, nor any other Person acting on its behalf will provide any Purchaser or its agents or counsel with any information that constitutes, or the Company reasonably believes constitutes, material non-public information, unless prior thereto such Purchaser shall have consented to the receipt of such information and agreed with the Company to keep such information confidential.  The Company understands and confirms that each Purchaser shall be relying on the foregoing covenant in effecting transactions in securities of the Company.  To the extent that the Company delivers any material, non-public information to a Purchaser without such Purchaser’s consent, the Company hereby covenants and agrees that such Purchaser shall not have any duty of confidentiality to the Company, any of its Subsidiaries, or any of their respective officers, directors, agents, employees or Affiliates, or a duty to the Company, any of its Subsidiaries or any of their respective officers, directors, agents, employees or Affiliates not to trade on the basis of, such material, non-public information, provided that the Purchaser shall remain subject to applicable law. To the extent that any notice provided pursuant to any Transaction Document constitutes, or contains, material, non-public information regarding the Company or any Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to a Current Report on Form 8-K.  The Company understands and confirms that each Purchaser shall be relying on the foregoing covenant in effecting transactions in securities of the Company.

23

 

4.6Use of Proceeds.  Except as set forth on Schedule 4.7 attached hereto, the Company shall use the net proceeds from the sale of the Shares hereunder for working capital purposes and shall not use such proceeds: (a) for the satisfaction of any portion of the Company’s debt (other than payment of trade payables in the ordinary course of the Company’s business and prior practices), (b) for the redemption of any Common Stock or Common Stock Equivalents, (c) for the settlement of any outstanding litigation or (d) in violation of FCPA or OFAC regulations.

4.7Indemnification of Purchasers.   Subject to the provisions of this Section 4.7, the Company will indemnify and hold each Purchaser and its directors, officers, shareholders, members, partners, employees and agents (and any other Persons with a functionally equivalent role of a Person holding such titles notwithstanding a lack of such title or any other title), each Person who controls such Purchaser (within the meaning of Section 15 of the Securities Act and Section 20 of the Exchange Act), and the directors, officers, shareholders, agents, members, partners or employees (and any other Persons with a functionally equivalent role of a Person holding such titles notwithstanding a lack of such title or any other title) of such controlling persons (each, a “Purchaser Party”) harmless from any and all losses, liabilities, obligations, claims, contingencies, damages, costs and expenses, including all judgments, amounts paid in settlements, court costs and reasonable attorneys’ fees and costs of investigation that any such Purchaser Party may suffer or incur as a result of or relating to (a) any breach of any of the representations, warranties, covenants or agreements made by the Company in this Agreement or in the other Transaction Documents or (b) any action instituted against the Purchaser Parties in any capacity, or any of them or their respective Affiliates, by any stockholder of the Company who is not an Affiliate of such Purchaser Party, with respect to any of the transactions contemplated by the Transaction Documents (unless such action is solely based upon a material breach of such Purchaser Party’s representations, warranties or covenants under the Transaction Documents or any agreements or understandings such Purchaser Party may have with any such stockholder or any violations by such Purchaser Party of state or federal securities laws or any conduct by such Purchaser Party which is finally judicially determined to constitute fraud, gross negligence, willful misconduct or malfeasance).  If any action shall be brought against any Purchaser Party in respect of which indemnity may be sought pursuant to this Agreement, such Purchaser Party shall promptly notify the Company in writing, and the Company shall have the right to assume the defense thereof with counsel of its own choosing reasonably acceptable to the Purchaser Party.  Any Purchaser Party shall have the right to employ separate counsel in any such action and participate in the defense thereof, but the fees and expenses of such counsel shall be at the expense of such Purchaser Party except to the extent that (x) the employment thereof has been specifically authorized by the Company in writing, (y) the Company has failed after a reasonable period of time to assume such defense and to employ counsel or (z) in such action there is, in the reasonable opinion of counsel, a material conflict on any material issue between the position of the Company and the position of such Purchaser Party, in which case the Company shall be responsible for the reasonable fees and expenses of no more than one such separate counsel.  The Company will not be liable to any Purchaser Party under this Agreement (1) for any settlement by a Purchaser Party effected without the Company’s prior written consent, which shall not be unreasonably withheld or delayed; or (2) to the extent, but only to the extent that a loss, claim, damage or liability is attributable to any Purchaser Party’s breach of any of the representations, warranties, covenants or agreements made by such Purchaser Party in this Agreement or in the other Transaction Documents. The indemnification required by this Section 

24

 

4.7 shall be made by periodic payments of the amount thereof during the course of the investigation or defense, as and when bills are received or are incurred. The indemnity agreements contained herein shall be in addition to any cause of action or similar right of any Purchaser Party against the Company or others and any liabilities the Company may be subject to pursuant to law.

4.8Reservation of Common Stock. As of the date hereof, the Company has reserved and the Company shall continue to reserve and keep available at all times, free of preemptive rights, a sufficient number of shares of Common Stock for the purpose of enabling the Company to issue Shares pursuant to this Agreement.   

4.9Listing of Common Stock. The Company hereby agrees to use reasonable best efforts to maintain the listing or quotation of the Common Stock on the Trading Market on which it is currently listed, and concurrently with the Closing, the Company shall apply to list or quote all of the Shares on such Trading Market and promptly secure the listing of all of the Shares on such Trading Market. The Company further agrees, if the Company applies to have the Common Stock traded on any other Trading Market, it will then include in such application all of the Shares, and will take such other action as is necessary to cause all of the Shares to be listed or quoted on such other Trading Market as promptly as possible.  The Company will then take all action reasonably necessary to continue the listing and trading of its Common Stock on a Trading Market and will comply in all respects with the Company’s reporting, filing and other obligations under the bylaws or rules of the Trading Market.  The Company agrees to maintain the eligibility of the Common Stock for electronic transfer through the Depository Trust Company or another established clearing corporation, including, without limitation, by timely payment of fees to the Depository Trust Company or such other established clearing corporation in connection with such electronic transfer.

4.10[Reserved.]  

4.11[Reserved.] 

4.12Equal Treatment of Purchasers.  No consideration (including any modification of any Transaction Document) shall be offered or paid to any Person to amend or consent to a waiver or modification of any provision of the Transaction Documents unless the same consideration is also offered to all of the parties to the Transaction Documents.  For clarification purposes, this provision constitutes a separate right granted to each Purchaser by the Company and negotiated separately by each Purchaser, and is intended for the Company to treat the Purchasers as a class and shall not in any way be construed as the Purchasers acting in concert or as a group with respect to the purchase, disposition or voting of Shares or otherwise.

4.13Certain Transactions and Confidentiality. Each Purchaser, severally and not jointly with the other Purchasers, covenants that neither it nor any Affiliate acting on its behalf or pursuant to any understanding with it will execute any purchases or sales, including Short Sales of any of the Company’s securities during the period commencing with the execution of this Agreement and ending at such time that the transactions contemplated by this Agreement are first publicly announced pursuant to the initial press release as described in Section 4.3.  Each Purchaser, severally and not jointly with the other Purchasers, covenants that until such time as 

25

 

the transactions contemplated by this Agreement are publicly disclosed by the Company pursuant to the initial press release as described in Section 4.3, such Purchaser will maintain the confidentiality of the existence and terms of this transaction and the information included in the Disclosure Schedules.  Notwithstanding the foregoing and notwithstanding anything contained in this Agreement to the contrary, the Company expressly acknowledges and agrees that (i) no Purchaser makes any representation, warranty or covenant hereby that it will not engage in effecting transactions in any securities of the Company after the time that the transactions contemplated by this Agreement are first publicly announced pursuant to the initial press release as described in Section 4.3, (ii) no Purchaser shall be restricted or prohibited from effecting any transactions in any securities of the Company in accordance with applicable securities laws from and after the time that the transactions contemplated by this Agreement are first publicly announced pursuant to the initial press release as described in Section 4.3 and (iii) no Purchaser shall have any duty of confidentiality or duty not to trade in the securities of the Company to the Company or its Subsidiaries after the issuance of the initial press release as described in Section 4.3.  Notwithstanding the foregoing, in the case of a Purchaser that is a multi-managed investment vehicle whereby separate portfolio managers manage separate portions of such Purchaser’s assets and the portfolio managers have no direct knowledge of the investment decisions made by the portfolio managers managing other portions of such Purchaser’s assets, the covenant set forth above shall only apply with respect to the portion of assets managed by the portfolio manager that made the investment decision to purchase the Shares covered by this Agreement.

4.14Capital Changes.  Until the one year anniversary of the Closing Date, the Company shall not undertake a reverse or forward stock split or reclassification of the Common Stock without the prior written consent of the Purchasers holding a majority in interest of the Shares, other than a stock split that is required, in the good faith judgment of the Board of Directors, to maintain the listing of the Common Stock on the current Trading Market.

ARTICLE V.
MISCELLANEOUS

5.1Termination.  This Agreement may be terminated by any Purchaser, as to such Purchaser’s obligations hereunder only and without any effect whatsoever on the obligations between the Company and the other Purchasers, by written notice to the other parties, if the Closing has not been consummated on or before the fifth (5th) Trading Day following the date hereof; provided, however, that no such termination will affect the right of any party to sue for any breach by any other party (or parties).

5.2Fees and Expenses.  Except as expressly set forth in the Transaction Documents to the contrary, each party shall pay the fees and expenses of its advisers, counsel, accountants and other experts, if any, and all other expenses incurred by such party incident to the negotiation, preparation, execution, delivery and performance of this Agreement.  The Company shall pay all Transfer Agent fees (including, without limitation, any fees required for same-day processing of any instruction letter delivered by the Company), stamp taxes and other taxes and duties levied in connection with the delivery of any Shares to the Purchasers.

26

 

5.3Entire Agreement.  The Transaction Documents, together with the exhibits and schedules thereto, the Prospectus and the Prospectus Supplement, contain the entire understanding of the parties with respect to the subject matter hereof and thereof and supersede all prior agreements and understandings, oral or written, with respect to such matters, which the parties acknowledge have been merged into such documents, exhibits and schedules.

5.4Notices.  Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall be in writing and shall be deemed given and effective on the earliest of: (a) the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number or email attachment at the email address as set forth on the signature pages attached hereto at or prior to 5:30 p.m. (New York City time) on a Trading Day, (b) the next Trading Day after the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number or email attachment at the email address as set forth on the signature pages attached hereto on a day that is not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading Day, (c) the second (2nd) Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight courier service or (d) upon actual receipt by the party to whom such notice is required to be given.  The address for such notices and communications shall be as set forth on the signature pages attached hereto. To the extent that any notice provided pursuant to any Transaction Document constitutes, or contains, material, non-public information regarding the Company or any Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to a Current Report on Form 8-K.

5.5Amendments; Waivers.  No provision of this Agreement may be waived, modified, supplemented or amended except in a written instrument signed, in the case of an amendment, by the Company and Purchasers which purchased at least 67% in interest of the Shares based on the initial Subscription Amounts hereunder or, in the case of a waiver, by the party against whom enforcement of any such waived provision is sought, provided that if any amendment, modification or waiver disproportionately and adversely impacts a Purchaser (or group of Purchasers), the consent of such disproportionately impacted Purchaser (or group of Purchasers) shall also be required.  No waiver of any default with respect to any provision, condition or requirement of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any subsequent default or a waiver of any other provision, condition or requirement hereof, nor shall any delay or omission of any party to exercise any right hereunder in any manner impair the exercise of any such right. Any proposed amendment or waiver that disproportionately, materially and adversely affects the rights and obligations of any Purchaser relative to the comparable rights and obligations of the other Purchasers shall require the prior written consent of such adversely affected Purchaser. Any amendment effected in accordance with this Section 5.5 shall be binding upon each Purchaser and holder of Securities and the Company.

5.6Headings.  The headings herein are for convenience only, do not constitute a part of this Agreement and shall not be deemed to limit or affect any of the provisions hereof.

5.7Successors and Assigns.  This Agreement shall be binding upon and inure to the benefit of the parties and their successors and permitted assigns.  The Company may not assign this Agreement or any rights or obligations hereunder without the prior written consent of each Purchaser (other than by merger).  Any Purchaser may assign any or all of its rights under this 

27

 

Agreement to any Person to whom such Purchaser assigns or transfers any Shares, provided that such transferee agrees in writing to be bound, with respect to the transferred Shares, by the provisions of the Transaction Documents that apply to the “Purchasers.”

5.8No Third-Party Beneficiaries.  The Placement Agent shall be the third party beneficiary of the representations and warranties of the Company in Section 3.1 and the representations and warranties of the Purchasers in Section 3.2.  This Agreement is intended for the benefit of the parties hereto and their respective successors and permitted assigns and is not for the benefit of, nor may any provision hereof be enforced by, any other Person, except as otherwise set forth in Section 4.7 and this Section 5.8.

5.9Governing Law.  All questions concerning the construction, validity, enforcement and interpretation of the Transaction Documents shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of conflicts of law thereof.  Each party agrees that all legal Proceedings concerning the interpretations, enforcement and defense of the transactions contemplated by this Agreement and any other Transaction Documents (whether brought against a party hereto or its respective affiliates, directors, officers, shareholders, partners, members, employees or agents) shall be commenced exclusively in the state and federal courts sitting in the City of New York.  Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in the City of New York, Borough of Manhattan for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein (including with respect to the enforcement of any of the Transaction Documents), and hereby irrevocably waives, and agrees not to assert in any Action or Proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such 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 Action or Proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof.  Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law.   If any party shall commence an Action or Proceeding to enforce any provisions of the Transaction Documents, then, in addition to the obligations of the Company under Section 4.7, the prevailing party in such Action or Proceeding shall be reimbursed by the non-prevailing party for its reasonable attorneys’ fees and other costs and expenses incurred with the investigation, preparation and prosecution of such Action or Proceeding.

5.10Survival.  The representations and warranties contained herein shall survive the Closing and the delivery of the Shares.

5.11Execution.  This Agreement may be executed in two or more counterparts, all of which when taken together shall be considered one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to each other party, it being understood that the parties need not sign the same counterpart.  In the event that any signature is delivered by facsimile transmission or by e-mail delivery of a “.pdf” format data file, such signature shall create a valid and binding obligation of the party executing (or on whose 

28

 

behalf such signature is executed) with the same force and effect as if such facsimile or “.pdf” signature page were an original thereof.

5.12Severability.  If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, illegal, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in full force and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use their commercially reasonable efforts to find and employ an alternative means to achieve the same or substantially the same result as that contemplated by such term, provision, covenant or restriction. It is hereby stipulated and declared to be the intention of the parties that they would have executed the remaining terms, provisions, covenants and restrictions without including any of such that may be hereafter declared invalid, illegal, void or unenforceable.

5.13Rescission and Withdrawal Right.  Notwithstanding anything to the contrary contained in (and without limiting any similar provisions of) any of the other Transaction Documents, whenever any Purchaser exercises a right, election, demand or option under a Transaction Document and the Company does not timely perform its related obligations within the periods therein provided, then such Purchaser may rescind or withdraw, in its sole discretion from time to time upon written notice to the Company, any relevant notice, demand or election in whole or in part without prejudice to its future actions and rights.

5.14Replacement of Shares.  If any certificate or instrument evidencing any Shares is mutilated, lost, stolen or destroyed, the Company shall issue or cause to be issued in exchange and substitution for and upon cancellation thereof (in the case of mutilation), or in lieu of and substitution therefor, a new certificate or instrument, but only upon receipt of evidence reasonably satisfactory to the Company of such loss, theft or destruction.  The applicant for a new certificate or instrument under such circumstances shall also pay any reasonable third-party costs (including customary indemnity) associated with the issuance of such replacement Shares.

5.15Remedies.  In addition to being entitled to exercise all rights provided herein or granted by law, including recovery of damages, each of the Purchasers and the Company will be entitled to specific performance under the Transaction Documents.  The parties agree that monetary damages may not be adequate compensation for any loss incurred by reason of any breach of obligations contained in the Transaction Documents and hereby agree to waive and not to assert in any Action for specific performance of any such obligation the defense that a remedy at law would be adequate.

5.16Payment Set Aside.  To the extent that the Company makes a payment or payments to any Purchaser pursuant to any Transaction Document or a Purchaser enforces or exercises its rights thereunder, and such payment or payments or the proceeds of such enforcement or exercise or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside, recovered from, disgorged by or are required to be refunded, repaid or otherwise restored to the Company, a trustee, receiver or any other Person under any law (including, without limitation, any bankruptcy law, state or federal law, common law or equitable cause of action), then to the extent of any such restoration the obligation or part thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such payment had not been made or such enforcement or setoff had not occurred.

29

 

5.17Independent Nature of Purchasers’ Obligations and Rights.  The obligations of each Purchaser under any Transaction Document are several and not joint with the obligations of any other Purchaser, and no Purchaser shall be responsible in any way for the performance or non-performance of the obligations of any other Purchaser under any Transaction Document.  Nothing contained herein or in any other Transaction Document, and no action taken by any Purchaser pursuant hereto or thereto, shall be deemed to constitute the Purchasers as a partnership, an association, a joint venture or any other kind of entity, or create a presumption that the Purchasers are in any way acting in concert or as a group with respect to such obligations or the transactions contemplated by the Transaction Documents.  Each Purchaser shall be entitled to independently protect and enforce its rights including, without limitation, the rights arising out of this Agreement or out of the other Transaction Documents, and it shall not be necessary for any other Purchaser to be joined as an additional party in any Proceeding for such purpose.  Each Purchaser has been represented by its own separate legal counsel in its review and negotiation of the Transaction Documents.  For reasons of administrative convenience only, each Purchaser and its respective counsel have chosen to communicate with the Company through EGS.  EGS does not represent any of the Purchasers and only represents the Placement Agent.  The Company has elected to provide all Purchasers with the same terms and Transaction Documents for the convenience of the Company and not because it was required or requested to do so by any of the Purchasers.  It is expressly understood and agreed that each provision contained in this Agreement and in each other Transaction Document is between the Company and a Purchaser, solely, and not between the Company and the Purchasers collectively and not between and among the Purchasers.

5.18Saturdays, 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.

5.19Construction. The parties agree that each of them and/or their respective counsel have reviewed and had an opportunity to revise the Transaction Documents and, therefore, the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of the Transaction Documents or any amendments thereto. In addition, each and every reference to share prices and shares of Common Stock in any Transaction Document shall be subject to adjustment for reverse and forward stock splits, stock dividends, stock combinations and other similar transactions of the Common Stock that occur after the date of this Agreement.

5.20WAIVER OF JURY TRIAL.  IN ANY ACTION, SUIT, OR PROCEEDING IN ANY JURISDICTION BROUGHT BY ANY PARTY AGAINST ANY OTHER PARTY, THE PARTIES EACH KNOWINGLY AND INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY, IRREVOCABLY AND EXPRESSLY WAIVES FOREVER TRIAL BY JURY. 

 

(Signature Pages Follow)

30

 

	

	
IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be duly executed by their respective authorized signatories as of the date first indicated above.

 

		
	
biocept, inc.

 

 
	
Address for Notice:

	
By:__________________________________________

     Name:

     Title:

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

E-Mail:

Fax:

	
 

 

 

 
	
Cooley LLP

4401 Eastgate Mall

San Diego, CA 92121

Attention: Charles Bair, Esq.

Fax: (858) 550-6420

 

 

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK

SIGNATURE PAGE FOR PURCHASER FOLLOWS]

31

 

[PURCHASER SIGNATURE PAGES TO BIOC SECURITIES PURCHASE AGREEMENT]

 

IN WITNESS WHEREOF, the undersigned have caused this Securities Purchase Agreement to be duly executed by their respective authorized signatories as of the date first indicated above.

Name of Purchaser: ________________________________________________________

Signature of Authorized Signatory of Purchaser: _________________________________

Name of Authorized Signatory: _______________________________________________

Title of Authorized Signatory: ________________________________________________

Email Address of Authorized Signatory:_________________________________________

Facsimile Number of Authorized Signatory: __________________________________________

Address for Notice to Purchaser:

 

 

Address for Delivery of Shares to Purchaser (if not same as address for notice):

 

 

DWAC for Shares:

 

 

Subscription Amount: $_________________

 

Shares: ____________________

 

EIN Number: _______________________

 

☐  Notwithstanding anything contained in this Agreement to the contrary, by checking this box (i) the obligations of the above-signed to purchase the securities set forth in this Agreement to be purchased from the Company by the above-signed, and the obligations of the Company to sell such securities to the above-signed, shall be unconditional and all conditions to Closing shall be disregarded, (ii) the Closing shall occur on the second (2nd) Trading Day following the date of this Agreement and (iii) any condition to Closing contemplated by this Agreement (but prior to being disregarded by clause (i) above) that required delivery by the Company or the above-signed of any agreement, instrument, certificate or the like or purchase price (as applicable) shall no longer be a condition and shall instead be an unconditional obligation of the Company or the above-signed (as applicable) to deliver such agreement, instrument, certificate or the like or purchase price (as applicable) to such other party on the Closing Date.

 

 

[SIGNATURE PAGES CONTINUE]

32

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00291-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00291-of-00352.parquet"}]]