Document:

Document

Exhibit 10.2

 PHASEBIO PHARMACEUTICALS, INC.
$55,000,000 Shares
Common Stock
($0.001 par value)
Equity Distribution Agreement
November 10, 2021
William Blair & Company, L.L.C.
150 North Riverside Plaza
Chicago, Illinois 60606

Ladies and Gentlemen:
PhaseBio Pharmaceuticals, Inc., a corporation organized under the laws of Delaware (the “Company”), confirms its agreement (this “Agreement”) with William Blair & Company, L.L.C. (the “Manager”) as follows:
1.Description of Shares.  The Company proposes to issue and sell through or to the Manager, as sales agent and/or principal, shares of the Company’s common stock, $0.001 par value (“Common Stock”), having an aggregate gross sales price of up to $55,000,000 (the “Shares”), from time to time during the term of this Agreement and on the terms set forth in Section 3 of this Agreement.  For purposes of selling the Shares through the Manager, the Company hereby appoints the Manager as exclusive agent of the Company for the purpose of soliciting purchases of the Shares from the Company pursuant to this Agreement and the Manager agree to use their reasonable efforts to solicit purchases of the Shares on the terms and subject to the conditions stated herein.  The Company agrees that whenever it determines to sell the Shares directly to the Manager as principal, it will enter into a separate agreement (each, a “Terms Agreement”) with the Manager in substantially the form of Annex I hereto, relating to such sale in accordance with Section 3 of this Agreement.  Certain terms used herein are defined in Section 19 hereof.
2.Representations and Warranties.  The Company represents and warrants to, and agrees with, the Manager at each such time the following representations and warranties are repeated or deemed to be made pursuant to this Agreement, as set forth below. 
(a)The Company meets the requirements for use of Form S-3 under the Securities Act and has prepared and filed or will file with the Commission a registration statement on Form S-3, including a Base Prospectus relating to certain securities. The Company has prepared a prospectus included as part of such registration statement specifically relating to the Shares (the “Offering Prospectus”). The Base Prospectus, including all documents incorporated therein by reference, included in such registration statement, as it may be supplemented by the Offering Prospectus and any prospectus supplement, in the form in which such Base Prospectus, Offering Prospectus and/or any 
						
		

			
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prospectus supplement have most recently been filed by the Company with the Commission pursuant to Rule 424(b) under the Securities Act, together with any Issuer Free Writing Prospectus, is herein called the “Prospectus.” Such Registration Statement, including any amendments thereto filed prior to the Execution Time or prior to any such time this representation is repeated or deemed to be made, will become or has become effective. The Prospectus will contain or contains all information required by the Securities Act and the rules thereunder, and, except to the extent the Manager shall agree in writing to a modification, shall be in all substantive respects in the form furnished to the Manager prior to the Execution Time or prior to any such time this representation is repeated or deemed to be made. The Registration Statement, at the Effective Date, will meet, and at each such time this representation is repeated or deemed to be made, and at all times during which a prospectus is required by the Securities Act to be delivered (whether physically or through compliance with Rule 172 or any similar rule) in connection with any offer or sale of Shares, meets the requirements set forth in Rule 415(a)(1)(x).  The initial Effective Date of the Registration Statement was not earlier than the date three years before the Execution Time. Any reference herein to the Registration Statement, the Base Prospectus, the Offering Prospectus or any Interim Prospectus Supplement shall be deemed to refer to and include the documents incorporated by reference therein pursuant to Item 12 of Form S-3 which were filed under the Exchange Act on or before the Effective Date of the Registration Statement or the issue date of the Base Prospectus, the Offering Prospectus or any Interim Prospectus Supplement, as the case may be; and any reference herein to the terms “amend,” “amendment” or “supplement” with respect to the Registration Statement, the Base Prospectus, the Prospectus or any Interim Prospectus Supplement shall be deemed to refer to and include the filing of any document under the Exchange Act after the Effective Date of the Registration Statement or the issue date of the Base Prospectus, the Prospectus or any Interim Prospectus, as the case may be, deemed to be incorporated therein by reference.
(b)To the extent that the Registration Statement is not available for the sales of the Shares as contemplated by this Agreement or the Company is not a “well known seasoned issuer” as defined in Rule 405 or otherwise is unable to make the representations set forth in Section 2(e) at any time when such representations are required, the Company shall file a new registration statement with respect to any additional shares of Common Stock necessary to complete such sales of the Shares and shall cause such registration statement to become effective as promptly as practicable.  After the effectiveness of any such registration statement, all references to “Registration Statement” included in this Agreement shall be deemed to include such new registration statement, including all documents incorporated by reference therein pursuant to Item 12 of Form S-3, and all references to the “Prospectus” included in this Agreement shall be deemed to include the final form of prospectus, including all documents incorporated therein by reference, included in any such registration statement at the time such registration statement became effective.
(c)On each Effective Date, at each Applicable Time, at each Settlement Date and at all times during which a prospectus is required by the Securities Act to be delivered (whether physically or through compliance with Rule 172 or any similar rule) 
						
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in connection with any offer or sale of Shares, the Registration Statement complied, and when it becomes effective will comply, in all material respects with the applicable requirements of the Securities Act and the Exchange Act and the respective rules thereunder 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 in order to make the statements therein not misleading; and on the date of any filing pursuant to Rule 424(b), at each Applicable Time, on each Settlement Date and at all times during which a prospectus is required by the Securities Act to be delivered (whether physically or through compliance with Rule 172 or any similar rule) in connection with any offer or sale of Shares, the Prospectus (together with any supplement thereto) complied and will comply in all material respects with the applicable requirements of the Securities Act and the Exchange Act and the respective rules thereunder and did not and will not include any 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; provided, however, that the Company makes no representations or warranties as to the information contained in or omitted from the Registration Statement or the Prospectus (or any supplement thereto) in reliance upon and in conformity with information furnished in writing to the Company by the Manager specifically for inclusion in the Registration Statement or the Prospectus (or any supplement thereto).
(d)At each Applicable Time and at each Settlement Date, the Disclosure Package does not, and will not, contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.  The preceding sentence does not apply to statements in or omissions from the Disclosure Package based upon and in conformity with written information furnished to the Company by the Manager specifically for use therein.
(e) (i) At the earliest time after the filing of the Registration Statement that the Company or another offering participant made a bona fide offer (within the meaning of Rule 164(h)(2)) of the Shares and (ii) as of the Execution Time and on each such time this representation is repeated or deemed to be made (with such date being used as the determination date for purposes of this clause (ii)), the Company was not and is not an Ineligible Issuer (as defined in Rule 405), without taking account of any determination by the Commission pursuant to Rule 405 that it is not necessary that the Company be considered an Ineligible Issuer.  
(f)Reserved.
(g)Reserved.
(h)Each Issuer Free Writing Prospectus, if any, does not include any information that conflicts with the information contained in the Registration Statement, including any document incorporated therein by reference and any prospectus supplement deemed to be a part thereof that has not been superseded or modified.  The foregoing sentence does not apply to statements in or omissions from any Issuer Free Writing 
						
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Prospectus based upon and in conformity with written information furnished to the Company by the Manager specifically for use therein.  
(i)The Registration Statement is not the subject of a pending proceeding or examination under Section 8(d) or 8(e) of the Securities Act, and the Company is not the subject of a pending proceeding under Section 8A of the Securities Act in connection with the offering of the Shares. 
(j)Reserved. 
(k)The Company is not party to any other sales agency agreements or other similar arrangements with any agent or any other representative in respect of at the market offerings of the Shares in accordance with Rule 415(a)(4) of the Securities Act.  
(l)The Company has not taken, directly or indirectly, without giving effect to activities by the Manager, any action designed to or that would constitute or that would reasonably be expected to cause or result in, under the Exchange Act or otherwise, stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Shares.
(m)The Company is not a party to any contract, agreement or understanding with any person (other than this Agreement) that would give rise to a valid claim against the Company or the Manager for a brokerage commission, finder’s fee or like payment in connection with the offering and sale of the Shares or any transaction contemplated by this Agreement, the Registration Statement, the Disclosure Package or the Prospectus. 
(n)The interactive data in the eXtensible Business Reporting Language (“XBRL”) included or incorporated by reference in the Registration Statement fairly presents the information called for in all material respects and has been prepared in accordance with the Commission’s rules and guidelines applicable thereto.   
(o)The Company been duly incorporated and is validly existing as a corporation in good standing under the laws of the jurisdiction in which it is chartered or organized with full corporate power and authority to own or lease, as the case may be, and to operate its properties and conduct its business as described in the Disclosure Package and the Prospectus, and is duly qualified to do business as a foreign corporation and is in good standing under the laws of each jurisdiction which requires such qualification, except where such failure would not reasonably be expected to have a material adverse effect on the condition (financial or otherwise), prospects, earnings, business or properties of the Company, whether or not arising from transactions in the ordinary course of business (a “Material Adverse Effect”).
(p)There is no franchise, contract or other document of a character required to be described in the Registration Statement or Prospectus, or to be filed as an exhibit thereto, which is not described or filed as required; and the statements in the Prospectus under the heading “Description of Capital Stock” insofar as such statements summarize legal matters, agreements, documents or proceedings discussed therein, are accurate and fair summaries of such legal matters, agreements, documents or proceedings.
						
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(q)This Agreement has been duly authorized, executed and delivered by the Company.
(r)The Company is not and, after giving effect to the offering and sale of the Shares and the application of the proceeds thereof as described in the Disclosure Package and the Prospectus, will not be an “investment company” as defined in the Investment Company Act of 1940, as amended, and the rules and regulations promulgated thereunder.
(s)No consent, approval, authorization, filing with or order of any court or governmental agency or body is required in connection with the transactions contemplated herein, except such as have been obtained under the Securities Act, the listing rules of the Nasdaq Global Market and the applicable rules of the Financial Industry Regulatory Authority, Inc. and such as may be required under the blue sky laws of any jurisdiction in connection with the purchase and distribution of the Shares by the Manager in the manner contemplated herein and in the Disclosure Package and the Prospectus.
(t)Neither the issue and sale of the Shares nor the consummation of any other of the transactions herein contemplated nor the fulfillment of the terms hereof will conflict with, result in a breach or violation of, or imposition of any lien, charge or encumbrance upon any property or assets of the Company pursuant to, (i) the charter or by- laws of the Company, (ii) the terms of any indenture, contract, lease, mortgage, deed of trust, note agreement, loan agreement or other agreement, obligation, condition, covenant or instrument to which the Company is a party or bound or to which its or their property is subject, or (iii) any statute, law, rule, regulation, judgment, order or decree applicable to the Company of any court, regulatory body, administrative agency, governmental body, arbitrator or other authority having jurisdiction over the Company or any of its properties, except in the cases of clauses (ii) and (iii) for such conflict, breach, violation or imposition as would not reasonably be expected to have a Material Adverse Effect.
(u)No holders of securities of the Company have rights to the registration of such securities under the Registration Statement except for such as have been effectively waived.
(v)The historical financial statements and schedules of the Company included in the Prospectus and the Registration Statement present fairly in all material respects the financial condition, results of operations and cash flows of the Company as of the dates and for the periods indicated, comply as to form in all material respects with the applicable accounting requirements of the Securities Act and have been prepared in conformity with generally accepted accounting principles applied on a consistent basis throughout the periods involved (except as otherwise noted therein).  
(w)No action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or its or their property is pending or, to the best knowledge of the Company, threatened that (i) would 
						
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reasonably be expected to have a Material Adverse Effect on the performance of this Agreement or the consummation of any of the transactions contemplated hereby or (ii) would reasonably be expected to have a Material Adverse Effect, except as set forth in or contemplated in the Disclosure Package and the Prospectus (exclusive of any amendment or supplement thereto).
(x) The Company owns or leases all such properties as are necessary to the conduct of its operations as presently conducted, except for intellectual property, which is separately addressed in subsection (rr) below, and except as would not reasonably be expected to have a Material Adverse Effect.
(y)The Company is not in violation or default of (i) any provision of its charter or bylaws, (ii) the terms of any indenture, contract, lease, mortgage, deed of trust, note agreement, loan agreement or other agreement, obligation, condition, covenant or instrument to which it is a party or bound or to which its property is subject, or (iii) any statute, law, rule, regulation, judgment, order or decree of any court, regulatory body, administrative agency, governmental body, arbitrator or other authority having jurisdiction over the Company or any of its properties, as applicable, except in the case of clauses (ii) and (iii), for such violation or default as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
(z)KPMG LLP, who have certified certain financial statements of the Company and delivered their report with respect to the audited financial statements and schedules included in the Disclosure Package and the Prospectus, are independent public accountants with respect to the Company within the meaning of the Securities Act and the applicable published rules and regulations thereunder.
(aa)There are no transfer taxes or other similar fees or charges under U.S. federal law or the laws of any state, or any political subdivision thereof, required to be paid in connection with the execution and delivery of this Agreement or the issuance by the Company of the Shares.
(ab)The Company has filed all tax returns that are required to be filed or has requested extensions thereof (except in any case in which the failure so to file would not reasonably be expected to have a Material Adverse Effect) and has paid all taxes required to be paid by it and any other assessment, fine or penalty levied against it, to the extent that any of the foregoing is due and payable, except for any such assessment, fine or penalty that is currently being contested in good faith or as would not reasonably be expected to have a Material Adverse Effect.
(ac)No labor problem or dispute with the employees of the Company exists or, to the knowledge of the Company, is threatened or imminent, and the Company is not aware of any existing or imminent labor disturbance by the employees of any of its principal suppliers, contractors or customers, that would reasonably be expected to have a Material Adverse Effect.
						
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(ad)The Company is insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as the Company reasonably believes are prudent and customary in the businesses in which they are engaged; all policies of insurance insuring the Company or its business, assets, employees, officers and directors are in full force and effect; the Company is in compliance with the terms of such policies and instruments in all material respects; and there are no claims by the Company under any such policy or instrument as to which any insurance company is denying liability or defending under a reservation of rights clause; the Company has not been refused any insurance coverage sought or applied for; and the Company has no 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 at a cost that would not reasonably be expected to have a Material Adverse Effect.
(ae)The Company possesses all licenses, certificates, permits and other authorizations required to be issued by all applicable authorities necessary to conduct its business, except where the failure to possess such licenses, certificates, permits and other authorizations would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, and the Company has not received any notice of proceedings relating to the revocation or modification of any such certificate, authorization or permit which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would reasonably be expected to have a Material Adverse Effect.
(af)The Company maintains a system of internal accounting controls designed 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 generally accepted accounting principles and to maintain asset accountability; (iii) access to assets is permitted only in accordance with management’s general or specific authorization, (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 and (v) the interactive data in eXtensible Business Reporting Language included or incorporated by reference in the Registration Statement and the Prospectus is in compliance with the Commission’s published rules, regulations and guidelines applicable thereto. The Company’s internal controls over financial reporting are effective at the reasonable assurance level and the Company is not aware of any material weakness in its internal controls over financial reporting (it being understood that as of the date hereof, the Company is not required to comply with Section 404 of the Sarbanes Oxley Act (as defined herein)).
(ag)The Company maintains “disclosure controls and procedures” (as such term is defined in Rule 13a-15(e) under the Exchange Act); such disclosure controls and procedures are effective at the reasonable assurance level.
(ah)The Company is (i) in compliance with any and all applicable foreign, federal, state and local laws and regulations relating to the protection of human health and safety, the environment or hazardous or toxic substances or wastes, pollutants or 
						
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contaminants (“Environmental Laws”), (ii) has received and is in compliance with all permits, licenses or other approvals required of them under applicable Environmental Laws to conduct its business and (iii) has not received notice of any actual or potential liability under any environmental law, except where such non-compliance with Environmental Laws, failure to receive required permits, licenses or other approvals, or liability would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. Except as set forth in the Disclosure Package and the Prospectus, the Company has not been named as a “potentially responsible party” under the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended.
(ai)None of the following events has occurred or exists: (i) a failure to fulfill the obligations, if any, under the minimum funding standards of Section 302 of the United States Employee Retirement Income Security Act of 1974, as amended (“ERISA”), and the regulations and published interpretations thereunder with respect to a Plan (as defined herein), determined without regard to any waiver of such obligations or extension of any amortization period; (ii) an audit or investigation by the Internal Revenue Service, the U.S. Department of Labor, the Pension Benefit Guaranty Corporation or any other federal or state governmental agency or any foreign regulatory agency with respect to the employment or compensation of employees by any of the Company that would reasonably be expected to have a Material Adverse Effect; and (iii) any breach of any contractual obligation, or any violation of law or applicable qualification standards, with respect to the employment or compensation of employees by the Company that would reasonably be expected to have a Material Adverse Effect. None of the following events has occurred or, to the Company’s knowledge, is reasonably likely to occur: (i) a material increase in the aggregate amount of contributions required to be made to all Plans in the current fiscal year of the Company compared to the amount of such contributions made in the most recently completed fiscal year of the Company; (ii) a material increase in the “accumulated post-retirement benefit obligations” (within the meaning of Statement of Financial Accounting Standards 106) of the Company compared to the amount of such obligations in the most recently completed fiscal year of the Company; (iii) any event or condition giving rise to a liability under Title IV of ERISA that would reasonably be expected to have a Material Adverse Effect; or (iv) the filing of a claim by one or more employees or former employees of the Company related to their employment that would reasonably be expected to have a Material Adverse Effect. For purposes of this paragraph, the term “Plan” means a plan (within the meaning of Section 3(3) of ERISA) subject to Title IV of ERISA with respect to which the Company may have any liability.
(aj)There is and has been no failure on the part of the Company and any of the Company’s directors or officers, in their capacities as such, to comply with any provision of the Sarbanes-Oxley Act of 2002, as amended, and the rules and regulations promulgated in connection thereunder (the “Sarbanes-Oxley Act”), including Section 402 relating to loans and Sections 302 and 906 relating to certifications.
(ak) Neither the Company nor, to the knowledge of the Company, any director, officer, agent, employee, affiliate or other person acting on behalf of the 
						
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Company is aware of or has taken any action, directly or indirectly, that would result in a violation or a sanction for violation by such persons of the Foreign Corrupt Practices Act of 1977 or the U.K. Bribery Act 2010, each as may be amended, or similar law of any other relevant jurisdiction, or the rules or regulations thereunder; and the Company has instituted and maintains policies and procedures designed to ensure compliance therewith. No part of the proceeds of the offering will be used, directly or indirectly, in violation of the Foreign Corrupt Practices Act of 1977 or the U.K. Bribery Act 2010, each as may be amended, or similar law of any other relevant jurisdiction, or the rules or regulations thereunder.
(al)The operations of the Company are and have been conducted at all times in compliance with applicable financial recordkeeping and reporting requirements and the money laundering statutes and the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any governmental agency (collectively, the “Money Laundering Laws”) and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company with respect to the Money Laundering Laws is pending or, to the best knowledge of the Company, threatened.
(am) Neither the Company nor, to the knowledge of the Company, any director, officer, agent, employee or affiliate of the Company (i) is, or is controlled or 50% or more owned in the aggregate by or is acting on behalf of, one or more individuals or entities that are currently the subject of any sanctions administered or enforced by the United States (including any administered or enforced by the Office of Foreign Assets Control of the U.S. Department of the Treasury, the U.S. Department of State or the Bureau of Industry and Security of the U.S. Department of Commerce), the United Nations Security Council, the European Union, a member state of the European Union (including sanctions administered or enforced by Her Majesty’s Treasury of the United Kingdom) or other relevant sanctions authority (collectively, “Sanctions” and such persons, “Sanctioned Persons” and each such person, a “Sanctioned Person”), (ii) is located, organized or resident in a country or territory that is, or whose government is, the subject of Sanctions that broadly prohibit dealings with that country or territory (collectively, “Sanctioned Countries” and each, a “Sanctioned Country”) or (iii) will, directly or indirectly, use the proceeds of this offering, or lend, contribute or otherwise make available such proceeds to any joint venture partner or other individual or entity in any manner that would result in a violation of any Sanctions by, or would result in the imposition of Sanctions against, any individual or entity (including any individual or entity participating in the offering and sale of the Shares, whether as underwriter, advisor, investor or otherwise).
(an)The Company has not engaged in any dealings or transactions with or for the benefit of a Sanctioned Person, or with or in a Sanctioned Country, in the preceding three years, nor does the Company have any plans to engage in dealings or transactions with or for the benefit of a Sanctioned Person, or with or in a Sanctioned Country.
(ao)The Company has no subsidiaries.
						
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(ap)The Company (i) is and at all times has been in compliance in all material respects with all statutes, rules and regulations applicable to the ownership, testing, development, manufacture, packaging, processing, use, distribution, marketing, advertising, labeling, promotion, sale, offer for sale, storage, import, export or disposal of any product manufactured or distributed by the Company including, without limitation the Federal Food, Drug and Cosmetic Act (21 U.S.C. §301 et seq.), the federal Anti- Kickback Statute (42 U.S.C. §1320a-7b(b)), the Health Insurance Portability and Accountability Act of 1996, as amended by the Health Information Technology for Economic and Clinical Health Act of 2009, and the Patient Protection and Affordable Care Act of 2010, as amended by the Health Care and Education Affordability Reconciliation Act of 2010, the regulations promulgated pursuant to such laws, and any successor government programs and comparable state laws, regulations relating to Good Clinical Practices and Good Laboratory Practices and all other local, state, federal, national, supranational and foreign laws, manual provisions, policies and administrative guidance relating to the regulation of the Company (collectively, the “Applicable Laws”); (ii) has not received any written notice from any court or arbitrator or governmental or regulatory authority or third party alleging or asserting noncompliance with any Applicable Laws or any licenses, exemptions, certificates, approvals, clearances, authorizations, permits, registrations and supplements or amendments thereto required by any such Applicable Laws (“Authorizations”), except for such non-compliance as would not reasonably be expected to have a Material Adverse Effect; (iii) possesses all Authorizations and such Authorizations are valid and in full force and effect and are not in violation of any term of any such Authorizations, except where the absence of any such Authorization would not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect; (iv) has not received written notice of any claim, action, suit, proceeding, hearing, enforcement, investigation arbitration or other action from any court or arbitrator or governmental or regulatory authority or third party alleging that any product operation or activity is in violation of any Applicable Laws or Authorizations nor, to the Company’s knowledge, is any such claim, action, suit, proceeding, hearing, enforcement, investigation, arbitration or other action threatened; (v) has not received any written notice that any court or arbitrator or governmental or regulatory authority has taken, is taking or intends to take, action to limit, suspend, materially modify or revoke any Authorizations nor, to the Company’s knowledge, is any such limitation, suspension, modification or revocation threatened; (vi) has filed, obtained, maintained or submitted all reports, documents, forms, notices, applications, records, claims, submissions and supplements or amendments as required by any Applicable Laws or Authorizations and that all such reports, documents, forms, notices, applications, records, claims, submissions and supplements or amendments were complete and accurate in all material respects on the date filed (or were corrected or supplemented by a subsequent submission), except where the failure to so file, obtain, maintain or submit or the failure of such reports, documents, forms, notices, applications, records, claims, submissions and supplements or amendment would not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect; and (vii) is not a party to any corporate integrity agreements, monitoring agreements, consent decrees, settlement orders, or similar agreements with or imposed by any governmental or regulatory authority.
						
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(aq)The clinical and pre-clinical trials conducted by or on behalf of or sponsored by the Company, or in which the Company has participated, that are described in the Registration Statement, the Disclosure Package and the Prospectus or the results of which are referred to in the Registration Statement, the Disclosure Package and the Prospectus, as applicable, and are intended to be submitted to Regulatory Authorities as a basis for product approval, were and, if still pending, are being conducted in all material respects in accordance with standard medical and scientific research procedures and all applicable statutes, rules and regulations of the U.S. Food and Drug Administration and comparable drug regulatory agencies outside of the United States to which it is subject (collectively, the “Regulatory Authorities”), including, without limitation, 21 C.F.R. Parts 50, 54, 56, 58, and 312, and current Good Clinical Practices and Good Laboratory Practices; the descriptions in the Registration Statement, the Disclosure Package or the Prospectus of the results of such studies and trials are accurate and complete in all material respects and fairly present the data derived from such trials; the Company has no knowledge of any other trials the results of which are inconsistent with or otherwise call into question the results described or referred to in the Disclosure Package and the Prospectus; the Company has operated and is currently in compliance in all material respects with all applicable statutes, rules and regulations of the Regulatory Authorities; the Company has not received any written notices, correspondence or other communication from the Regulatory Authorities or any governmental authority which could lead to the termination or suspension of any clinical or pre-clinical trials that are described in the Disclosure Package and the Prospectus or the results of which are referred to in the Registration Statement, Disclosure Package or the Prospectus, and, to the Company’s knowledge, there are no reasonable grounds for same.
(ar)The Company owns, possesses, licenses or has other rights to use, on reasonable terms, all patents, patent applications, trade and service marks, trade and service mark registrations, trade names, copyrights, licenses, inventions, trade secrets, technology, know-how and other intellectual property (collectively, the “Intellectual Property”) necessary for the conduct of the Company’s business as now conducted or as proposed in the Disclosure Package and Prospectus to be conducted, except, in each case, where the failure to own, possess, license or have such other rights that would not, individually or in the aggregate, have a Material Adverse Effect. Except as set forth in the Disclosure Package and the Prospectus (a) to the Company’s knowledge, there are no rights of third parties to any such Intellectual Property; (b) to the Company’s knowledge, there is no material infringement by third parties of any such Intellectual Property; (c) there is no pending or, to the Company’s knowledge, threatened action, suit, proceeding or claim by others challenging the Company’s rights in or to any such Intellectual Property, and the Company is unaware of any facts which would form a reasonable basis for any such claim; (d) there is no pending or, to the Company’s knowledge, threatened action, suit, proceeding or claim by others challenging the validity or scope of any such Intellectual Property, and the Company is unaware of any facts which would form a reasonable basis for any such claim; (e) there is no pending or, to the Company’s knowledge, threatened action, suit, proceeding or claim by others that the Company infringes or otherwise violates any patent, trademark, copyright, trade secret or other proprietary rights of others, and the Company is unaware of any other fact which would form a reasonable basis for any such claim; (f) to the Company’s knowledge, there is no 
						
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U.S. patent or published U.S. patent application which contains claims that dominate or may dominate any Intellectual Property described in the Disclosure Package and the Prospectus as being owned by or licensed to the Company or that interferes with the issued or pending claims of any such Intellectual Property; and (g) there is no prior art of which the Company is aware that may render any U.S. patent held by the Company invalid or any U.S. patent application held by the Company un-patentable which has not been disclosed to the U.S. Patent and Trademark Office.
(as)Except as disclosed in the Registration Statement, the Disclosure Package and the Prospectus, the Company (i) does not have any material lending or other relationship with any bank or lending affiliate of the Manager and (ii) does not intend to use any of the proceeds from the sale of the Shares hereunder to repay any outstanding debt owed to any affiliate of the Manager.
(at)Nothing has come to the attention of the Company that has caused the Company to believe that the statistical and market-related data included or incorporated by reference in the Registration Statement, the Disclosure Package and the Prospectus is not based on or derived from sources that are reliable and accurate in all material respects.
(au)No forward-looking statement (within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act) contained in the Registration Statement, the Disclosure Package or the Prospectus has been made or reaffirmed without a reasonable basis or has been disclosed other than in good faith.
(av)Except as may be included or incorporated by reference in the Registration Statement, the Disclosure Package and the Prospectus, (i) (x) to the Company’s knowledge, there has been no material security breach or other material compromise of or relating to any of the Company’s information technology and computer systems, networks, hardware, software, data (including the data of their respective customers, employees, suppliers, vendors and any third party data maintained by or on behalf of it), equipment or technology (collectively, “IT Systems and Data”) and (y) the Company has not been notified of, and has no knowledge of any event or condition that would reasonably be expected to result in, any material security breach or other material compromise to their IT Systems and Data; (ii) the Company is presently in compliance with all applicable laws or statutes and all judgments, orders, rules and regulations of any court or arbitrator or governmental or regulatory authority, internal policies and contractual obligations relating to the privacy and security of IT Systems and Data and to the protection of such IT Systems and Data from unauthorized use, access, misappropriation or modification, except as would not, in the case of this clause (ii), individually or in the aggregate, have a Material Adverse Effect; and (iii) the Company has implemented backup and disaster recovery technology consistent with industry standards and practices.
Any certificate signed by any officer of the Company and delivered to the Manager or counsel for the Manager in connection with this Agreement or any Terms Agreement shall be 
						
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deemed a representation and warranty by the Company, as to matters covered thereby, to the Manager.
3.Sale and Delivery of Shares.  
(a)Subject to the terms and conditions and in reliance upon the representations and warranties herein set forth, the Company agrees to issue and sell Shares from time to time through the Manager, acting as sales agent, and the Manager agrees to use their reasonable efforts to sell, as sales agents for the Company, the Shares on the following terms. 
(i)The Shares are to be sold by the Manager on a daily basis or otherwise as shall be agreed to by the Company and the Manager on any day that (A) is a trading day for the Nasdaq Global Market (“Nasdaq”), (B) the Company has instructed the Manager by telephone (confirmed promptly by electronic mail) to make such sales and (C) the Company has satisfied its obligations under Section 6 of this Agreement.  The Company will designate the maximum daily amount of the Shares to be sold by the Manager as agreed to by the Manager (in any event not in excess of the amount available for issuance under the Prospectus and the currently effective Registration Statement) and the minimum price per Share at which such Shares may be sold.  Subject to the terms and conditions hereof, the Manager shall use its reasonable efforts to sell on a particular day all of the Shares designated for the sale by the Company on such day.  The gross sales price of the Shares sold under this Section 3(a) shall be the market price for shares of the Company’s Common Stock sold by the Manager under this Section 3(a) on Nasdaq at the time of sale of such Shares. 
(ii)The Company acknowledges and agrees that (A) there can be no assurance that the Manager will be successful in selling the Shares, (B) the Manager will incur no liability or obligation to the Company or any other person or entity if the Manager does not sell Shares for any reason other than a failure by the Manager to use its reasonable efforts consistent with its normal trading and sales practices and applicable law and regulations to sell such Shares as required under this Agreement, and (C) the Manager shall not be under any obligation to purchase Shares on a principal basis pursuant to this Agreement, except as otherwise specifically agreed by the Manager and the Company.
(iii)The Company shall not authorize the issuance and sale of, and the Manager shall not be obligated to use its reasonable efforts to sell, any Share at a price lower than the minimum price therefor designated from time to time by the Company’s Board of Directors (the “Board”), or a duly authorized committee thereof, and notified to the Manager in writing.  The Company or the Manager may, upon notice to the other party hereto by telephone (confirmed promptly by electronic mail), suspend the offering of the Shares for any reason and at any time; provided, however, that such suspension or termination shall not affect or impair the parties’ respective obligations with respect to the Shares sold hereunder prior to the giving of such notice.  
						
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(iv)The Manager hereby covenants and agrees not to make any sales of the Shares on behalf of the Company, pursuant to this Section 3(a), other than (A) by means of ordinary brokers’ transactions between members of Nasdaq that qualify for delivery of a Prospectus to Nasdaq in accordance with Rule 153 of the Securities Act (such transactions are hereinafter referred to as “Continuous Offerings”) and (B) such other sales of the Shares on behalf of the Company in its capacity as agent of the Company as shall be agreed by the Company and the Manager pursuant to a Terms Agreement.   
(v)The compensation to the Manager for sales of the Shares with respect to which the Manager acts as sales agent under this Agreement shall be up to 3.0% of the gross sales price of the Shares sold pursuant to this Section 3(a) and payable as described in the succeeding subsection (vi) below. The foregoing rate of compensation shall not apply when the Manager acts as principal, in which case the Company may sell Shares to the Manager as principal at a price agreed upon at the relevant Applicable Time pursuant to a Terms Agreement. The remaining proceeds, after further deduction for any transaction fees imposed by any governmental or self-regulatory organization in respect of such sales (the “Transaction Fees”), shall constitute the net proceeds to the Company for such Shares (the “Net Proceeds”).  
(vi)The Manager shall provide written confirmation (which may be by facsimile or electronic mail) to the Company following the close of trading on Nasdaq each day in which the Shares are sold under this Section 3(a) setting forth the number of the Shares sold on such day, the aggregate gross sales proceeds and the Net Proceeds to the Company, and the compensation payable by the Company to the Manager with respect to such sales.  Such compensation shall be set forth and invoiced in periodic statements from the Manager to the Company, with payment to be made by the Company promptly after its receipt thereof.
(vii)Settlement for sales of the Shares pursuant to this Section 3(a) will occur on the second business day following the date on which such sales are made (each such day, a “Settlement Date”). On each Settlement Date, the Shares sold through the Manager for settlement on such date shall be issued and delivered by the Company to the Manager against payment of the aggregate gross sales proceeds less any Transaction Fees for the sale of such Shares.  Settlement for all such Shares shall be effected by free delivery of the Shares to the Manager’s account at The Depository Trust Company (“DTC”) in return for payments in same day funds delivered to the account designated by the Company.  If the Company or its transfer agent (if applicable) shall default on its obligation to deliver the Shares on any Settlement Date, the Company shall (A) indemnify and hold the Manager harmless against any loss, claim or damage arising from or as a result of such default by the Company and (B) pay the Manager any commission to which it would otherwise be entitled absent such default. If the Manager breaches this Agreement by failing to deliver the aggregate gross sales proceeds less any Transaction Fees to the Company on any Settlement Date for the Shares delivered by the Company, the Manager will pay the Company interest 
						
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based on the effective overnight federal funds rate on such unpaid amount less any compensation due to the Manager.
(viii)At each Applicable Time, Settlement Date and Representation Date (as defined in Section 4(k)), the Company shall be deemed to have affirmed each representation and warranty contained in this Agreement as if such representation and warranty were made as of such date, modified as necessary to relate to the Registration Statement and the Prospectus as amended as of such date.  Any obligation of the Manager to use its reasonable efforts to sell the Shares on behalf of the Company shall be subject to the continuing accuracy of the representations and warranties of the Company herein, to the performance by the Company of its obligations hereunder and to the continuing satisfaction of the additional conditions specified in Section 6 of this Agreement.      
(b)If the Company wishes to issue and sell the Shares pursuant to this Agreement but other than as set forth in Section 3(a) of this Agreement (each, a “Placement”), it will notify the Manager of the proposed terms of such Placement.  If the Manager wishes to accept such proposed terms (which it may decline to do for any reason in its sole discretion) or, following discussions with the Company wishes to accept amended terms, the Manager and the Company will enter into a Terms Agreement setting forth the terms of such Placement.  The terms set forth in a Terms Agreement will not be binding on the Company or the Manager unless and until the Company and the Manager have each executed such Terms Agreement accepting all of the terms of such Terms Agreement.  In the event of a conflict between the terms of this Agreement and the terms of a Terms Agreement, the terms of such Terms Agreement will control.  
(c)Each sale of the Shares to the Manager shall be made in accordance with the terms of this Agreement and, if applicable, a Terms Agreement, which will provide for the sale of such Shares to, and the purchase thereof by, the Manager.  A Terms Agreement may also specify certain provisions relating to the reoffering of such Shares by the Manager.  The commitment of the Manager to purchase the Shares pursuant to any Terms Agreement shall be deemed to have been made on the basis of the representations and warranties of the Company herein contained and shall be subject to the terms and conditions herein set forth.  Each Terms Agreement shall specify the number of the Shares to be purchased by the Manager pursuant thereto, the price to be paid to the Company for such Shares, any provisions relating to rights of, and default by, underwriters acting together with the Manager in the reoffering of the Shares, and the time and date (each such time and date being referred to herein as a “Time of Delivery”) and place of delivery of and payment for such Shares.  Such Terms Agreement shall also specify any requirements for opinions of counsel, accountants’ letters and officers’ certificates pursuant to Section 6 of this Agreement and any other information or documents required by the Manager.
(d)Under no circumstances shall the number and aggregate amount of the Shares sold pursuant to this Agreement and any Terms Agreement exceed (i) the aggregate amount set forth in Section 1, (ii) the number of shares of the Common Stock available for issuance under the currently effective Registration Statement or (iii) the 
						
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number and aggregate amount of the Shares authorized from time to time to be issued and sold under this Agreement by the Board, or a duly authorized committee thereof, and notified to the Manager acting as sales agent in writing.  
(e)If any party has reason to believe that the exemptive provisions set forth in Rule 101(c)(1) of Regulation M under the Exchange Act are not satisfied with respect to the Shares, it shall promptly notify the other parties and sales of the Shares under this Agreement and any Terms Agreement shall be suspended until that or other exemptive provisions have been satisfied in the judgment of each party.    
(f)Notwithstanding any other provision of this Agreement the Company shall not request the sale of any Shares that would be sold, and the Manager shall not be obligated to sell, during any period in which the Company’s insider trading policy, as it exists at the Execution Time, would prohibit the purchases or sales of the Company’s Common Stock by its officers or directors, or during any other period in which the Company is, or would reasonably be deemed to be, in possession of material non-public information; provided that, unless otherwise agreed between the Company and the Manager, for purposes of this paragraph (f) such period shall be deemed to end on the date on which the Company’s next subsequent Annual Report on Form 10-K or Quarterly Report on Form 10-Q, as the case may be, is filed with the Commission.
4.Agreements.  The Company agrees with the Manager that:
(a)During any period when the delivery of a prospectus relating to the Shares is required (including in circumstances where such requirement may be satisfied pursuant to Rule 172) to be delivered under the Securities Act, the Company will not file any amendment of the Registration Statement or supplement to the Prospectus (other than an amendment or supplement relating to an offering of the Company’s securities that is unrelated to the offering of Shares hereunder or any amendment pursuant to Section 10(a)(3) of the Securities Act deemed effected pursuant to the filing of an Annual Report on Form 10-K by the Company) or any Rule 462(b) Registration Statement unless the Company has furnished to the Manager a copy for its review prior to filing and will not file any such proposed amendment or supplement to which the Manager reasonably objects. The Company will properly complete the Prospectus, in a form approved by the Manager, and file such Prospectus, with the Commission and will cause any supplement to the Prospectus to be properly completed, in a form approved by the Manager, and will file such supplement with the Commission pursuant to the applicable paragraph of Rule 424(b) within the time period prescribed thereby and will provide evidence satisfactory to the Manager of such timely filing. The Company will promptly advise the Manager (i) when the Prospectus, and any supplement thereto, shall have been filed (if required) with the Commission pursuant to Rule 424(b) or when any Rule 462(b) Registration Statement shall have been filed with the Commission, (ii) when, during any period when the delivery of a prospectus (whether physically or through compliance with Rule 172 or any similar rule) is required under the Securities Act in connection with the offering or sale of the Shares, any amendment to the Registration Statement shall have been filed or become effective, (iii) of any request by the Commission or its staff for any amendment of the Registration Statement, or any Rule 462(b) Registration Statement, or 
						
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for any supplement to the Prospectus or for any additional information, (iv) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or of any notice objecting to its use or the institution or threatening of any proceeding for that purpose and (v) of the receipt by the Company of any notification with respect to the suspension of the qualification of the Shares for sale in any jurisdiction or the institution or threatening of any proceeding for such purpose.  Notwithstanding the foregoing, the Company shall not be obligated to provide notice of or furnish copies of any report or statement filed with the Commission to the extent it is available on the Commission’s Electronic Data Gathering, Analysis, and Retrieval System.  The Company will use its reasonable best efforts to prevent the issuance of any such stop order or the occurrence of any such suspension or objection to the use of the Registration Statement and, upon such issuance, occurrence or notice of objection, to obtain as soon as possible the withdrawal of such stop order or relief from such occurrence or objection, including, if necessary, by filing an amendment to the Registration Statement or a new registration statement and using its reasonable best efforts to have such amendment or new registration statement declared effective as soon as practicable. 
(b)If, at any time on or after an Applicable Time but prior to the related Settlement Date or Time of Delivery, any event occurs as a result of which the Disclosure Package would include any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein in the light of the circumstances under which they were made or the circumstances then prevailing not misleading, the Company will (i) notify promptly the Manager so that any use of the Disclosure Package may cease until it is amended or supplemented; (ii) amend or supplement the Disclosure Package to correct such statement or omission; and (iii) supply any amendment or supplement to the Manager in such quantities as the Manager may reasonably request. Notwithstanding the foregoing, in the alternative the Company can suspend or terminate the sale of Shares by the Manager upon written notice to the Manager and delay the filing of any amendment or supplement, if in the judgment of the Company, it is in the best interest of the Company.
(c)During any period when the delivery of a prospectus relating to the Shares is required (including in circumstances where such requirement may be satisfied pursuant to Rule 172) to be delivered under the Securities Act, any event occurs as a result of which the Prospectus as then supplemented would include any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein in the light of the circumstances under which they were made at such time not misleading, or if it shall be necessary to amend the Registration Statement, file a new registration statement or supplement the Prospectus to comply with the Securities Act or the Exchange Act or the respective rules thereunder, including in connection with use or delivery of the Prospectus, the Company promptly will (i) notify the Manager of any such event, (ii) prepare and file with the Commission, subject to the second sentence of paragraph (a) of this Section 4, an amendment or supplement or new registration statement which will correct such statement or omission or effect such compliance, (iii) use its reasonable best efforts to have any amendment to the Registration Statement or new registration statement declared effective as soon as practicable in order to avoid any 
						
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disruption in use of the Prospectus and (iv) supply any supplemented Prospectus to the Manager in such quantities as the Manager may reasonably request. Notwithstanding the foregoing, in the alternative, the Company can suspend or terminate the sale of Shares by the Manager upon written notice to the Manager and delay the filing of any amendment or supplement, if in the judgment of the Company, it is in the best interest of the Company.
(d)As soon as practicable, the Company will make generally available to its security holders and to the Manager an earnings statement or statements of the Company and its subsidiaries which will satisfy the provisions of Section 11(a) of the Securities Act and Rule 158.
(e)The Company will furnish to the Manager and counsel for the Manager, without charge, signed copies of the Registration Statement (including exhibits thereto) and, so long as delivery of a prospectus by the Manager or dealer may be required by the Securities Act (including in circumstances where such requirement may be satisfied pursuant to Rule 172), as many copies of the Prospectus and any Issuer Free Writing Prospectus and any supplement thereto as the Manager may reasonably request.  The Company will pay the expenses of printing or other production of all documents relating to the offering.
(f)The Company will arrange, if necessary, for the qualification of the Shares for sale under the laws of such jurisdictions as the Manager may reasonably designate and will maintain such qualifications in effect so long as required for the distribution of the Shares; provided that in no event shall the Company be obligated to qualify to do business in any jurisdiction where it is not now so qualified or to take any action that would subject it to service of process in suits, other than those arising out of the offering or sale of the Shares, in any jurisdiction where it is not now so subject.
(g)The Company agrees that, unless it has or shall have obtained the prior written consent of the Manager, and the Manager agrees with the Company that, unless it has or shall have obtained, as the case may be, the prior written consent of the Company, it has not made and will not make any offer relating to the Shares that would constitute an Issuer Free Writing Prospectus or that would otherwise constitute a “free writing prospectus” (as defined in Rule 405) required to be filed by the Company with the Commission or retained by the Company under Rule 433; provided that the prior written consent of the parties hereto shall be deemed to have been given in respect of the Free Writing Prospectuses included in Schedule I hereto. Any such free writing prospectus consented to by the Manager or the Company is hereinafter referred to as a “Permitted Free Writing Prospectus.”  The Company agrees that (i) it has treated and will treat, as the case may be, each Permitted Free Writing Prospectus as an Issuer Free Writing Prospectus and (ii) it has complied and will comply, as the case may be, with the requirements of Rules 164 and 433 applicable to any Permitted Free Writing Prospectus, including in respect of timely filing with the Commission, legending and record keeping. 
(h)The Company will not offer, sell, contract to sell, pledge, or otherwise dispose of, (or enter into any transaction which is designed to, or might reasonably be 
						
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expected to, result in the disposition of (whether by actual disposition or effective economic disposition due to cash settlement or otherwise) by the Company or any affiliate of the Company or any person in privity with the Company or any affiliate of the Company) directly or indirectly, including the filing (or participation in the filing) of a registration statement with the Commission in respect of, or establish or increase a put equivalent position or liquidate or decrease a call equivalent position within the meaning of Section 16 of the Exchange Act, any other shares of Common Stock or any securities convertible into, or exercisable, or exchangeable for, shares of Common Stock; or publicly announce an intention to effect any such transaction without (i) giving the Manager at least five Business Days’ prior written notice specifying the nature of the proposed transaction and the date of such proposed transaction and (ii) the Manager suspending acting under this Agreement for such period of time requested by the Company or as deemed appropriate by the Manager in light of the proposed transaction; provided, however, that the Company may issue and sell Common Stock pursuant to this Agreement or any Terms Agreement (provided that the Manager is aware of such transaction), issue, grant or sell Common Stock, options or other equity awards pursuant to any equity incentive plan, inducement plan, employee stock option plan, stock ownership plan or dividend reinvestment plan of the Company in effect at the Execution Time or approved by the Company’s Board thereafter, and the Company may issue Common Stock issuable upon the conversion of securities or the exercise of warrants outstanding at the Execution Time.  
(i)The Company will not (i) take, directly or indirectly, any action designed to or that would constitute or that might reasonably be expected to cause or result in, under the Exchange Act or otherwise, stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Shares or (ii) sell, bid for, purchase or pay any person (other than as contemplated by this Agreement or any Terms Agreement) any compensation for soliciting purchases of the Shares.
(j)The Company will, at any time during the term of this Agreement, as supplemented from time to time, advise the Manager immediately after it shall have received notice or obtain knowledge thereof, of any information or fact that would alter or affect any opinion, certificate, letter and other document provided to the Manager pursuant to Section 6 herein.  
(k)Upon commencement of the offering of the Shares under this Agreement (and upon the recommencement of the offering of the Shares under this Agreement following the termination of a suspension of sales hereunder), and each time that (i) the Registration Statement or the Prospectus shall be amended or supplemented (other than an Interim Prospectus Supplement filed pursuant to Rule 424(b) or a prospectus supplement relating solely to the offering of securities other than the Shares), (ii) the Company files an Annual Report on Form 10-K under the Exchange Act, (iii) a Quarterly Report on Form 10-Q under the Exchange Act, (iv) a Current Report on Form 8-K containing amended financial information (other than an earnings release or other information “furnished” pursuant to Items 2.02 or 7.01 of Form 8-K) under the Exchange Act, (v) the Shares are delivered to the Manager as principal at the Time of Delivery pursuant to a Terms Agreement, or (vi) otherwise as the Manager may reasonably request 
						
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(such commencement or recommencement date and each such date referred to in (i), (ii), (iii), (iv), (v) and (vi) above, a “Representation Date”), the Company shall furnish or cause to be furnished to the Manager forthwith a certificate dated and delivered the date of such commencement or recommencement, effectiveness of such amendment, the date of filing with the Commission of such supplement or other document,  the Time of Delivery, or promptly upon request, as the case may be, in form satisfactory to the Manager to the effect that the statements contained in the certificate referred to in Section 6(e) of this Agreement which were last furnished to the Manager are true and correct at the time of such commencement or recommencement, amendment, supplement, filing, or delivery, as the case may be, as though made at and as of such time (except that such statements shall be deemed to relate to the Registration Statement and the Prospectus as amended and supplemented to such time) or, in lieu of such certificate, a certificate of the same tenor as the certificate referred to in said Section 6(e), modified as necessary to relate to the Registration Statement and the Prospectus as amended and supplemented to the time of delivery of such certificate. The requirement to deliver a certificate under this Section 4(k) with respect to clauses (i), (iii), (iv), (v) or (vi) of the definition of Representation Date shall be automatically waived at a time at which no offering of Shares under this Agreement is ongoing, no sale of Shares by the Manager is pending or no Terms Agreement is in effect (a “Waiver”), which Waiver, in each case, shall not apply the next time Shares are sold by the Manager or the Company enters into a Terms Agreement.  Notwithstanding the foregoing, if the Company subsequently decides to sell Shares following a Representation Date when the Company relied on a Waiver and did not provide the Manager with a certificate under this Section 4(k), then before the Manager sells any Shares, the Company promptly shall provide the Manager with a certificate required under this Section 4(k).
(l)On the initial Representation Date and thereafter on each subsequent Representation Date that the Company delivers a certificate pursuant to Section 4(k), unless a Waiver is applicable, the Company shall furnish or cause to be furnished forthwith to the Manager and to counsel to the Manager a written opinion of Cooley LLP, counsel to the Company (“Company Counsel”), or other counsel satisfactory to the Manager, dated and delivered the date of commencement or recommencement, effectiveness of such amendment, the date of filing with the Commission of such supplement or other document, the Time of Delivery, or promptly upon such request, as the case may be, in form and substance reasonably satisfactory to the Manager, of the same tenor as the opinions referred to in Section 6(b) of this Agreement, but modified as necessary to relate to the Registration Statement and the Prospectus as amended and supplemented to the time of delivery of such opinion; provided, however, following the delivery of the first written opinion of Company Counsel under this Section 4(l), Company Counsel may, in lieu of the requirement to deliver such legal written opinion, furnish the Manager a letter (a “Reliance Letter”) to the effect that the Manager may rely on a prior written opinion delivered under this Section 4(l) to the same extent as if it was dated the date of such Reliance Letter (except that such statements in such prior opinion letter shall be deemed to relate to the Registration Statement and the Prospectus as amended or supplemented at such Representation Date);.   
						
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(m)At each Representation Date, the Company shall furnish or cause to be furnished forthwith to the Manager and to counsel to the Manager a written opinion of Cooley LLP, intellectual property counsel to the Company (“Company IP Counsel”), or other intellectual property counsel satisfactory to the Manager, dated and delivered the date of commencement or recommencement, effectiveness of such amendment, the date of filing with the Commission of such supplement or other document, the Time of Delivery, or promptly upon such request, as the case may be, in form and substance satisfactory to the Manager, of the same tenor as the opinions referred to in Section 6(c) of this Agreement, but modified as necessary to relate to the Registration Statement and the Prospectus as amended and supplemented to the time of delivery of such opinion.   
(n)On the initial Representation Date and thereafter on each subsequent Representation Date that the Company delivers a certificate pursuant to Section 4(k), unless a Waiver is applicable, Goodwin Procter LLP, counsel to the Manager (“Manager’s Counsel”), shall deliver a written opinion, dated and delivered the date of commencement or recommencement, effectiveness of such amendment, the date of filing with the Commission of such supplement or other document, the Time of Delivery, or promptly upon such request, as the case may be, of, in form and substance satisfactory to the Manager, of the same tenor as the opinions referred to in Section 6(d) of this Agreement but modified as necessary to relate to the Registration Statement and the Prospectus as amended and supplemented to the time of delivery of such opinion; provided, however, following the delivery of the first written opinion of Manager’s Counsel under this Section 4(n), Manager’s Counsel may, in lieu of the requirement to deliver such legal written opinion, furnish the Manager a Reliance Letter to the effect that the Manager may rely on a prior written opinion delivered under this Section 4(n) to the same extent as if it was dated the date of such Reliance Letter (except that such statements in such prior opinion letter shall be deemed to relate to the Registration Statement and the Prospectus as amended or supplemented at such Representation Date).
(o)Upon commencement of the offering of the Shares under this Agreement (and upon the recommencement of the offering of the Shares under this Agreement following the termination of a suspension of sales hereunder), and each time that (i) the Registration Statement or the Prospectus shall be amended or supplemented to include additional amended financial information, (ii) the Shares are delivered to the Manager as principal at a Time of Delivery pursuant to a Terms Agreement, (iii) the Company files a Quarterly Report on Form 10-Q or an Annual Report on Form 10-K, or (iv) at the Manager’s request and upon reasonable advance notice to the Company, there is filed with the Commission any document which contains financial information (other than an Annual Report on Form 10-K) incorporated by reference into the Prospectus, the Company shall cause KPMG LLP (the “Accountants”), or other independent accountants satisfactory to the Manager forthwith, to furnish the Manager a letter, dated the date of commencement or recommencement, effectiveness of such amendment, the date of filing of such supplement or other document with the Commission, or the Time of Delivery, as the case may be, in form reasonably satisfactory to the Manager, of the same tenor as the letter referred to in Section 6(f) of this Agreement but modified to relate to the Registration Statement and the Prospectus, as amended and supplemented to the date of such letter.
						
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(p)Upon commencement of the offering of the Shares under this Agreement (and upon the recommencement of the offering of the Shares under this Agreement following the termination of a suspension of sales hereunder), and at each Representation Date, unless a Waiver is applicable, the Company will, upon the request of the Manager, conduct a due diligence session, in form and substance reasonably satisfactory to the Manager, which shall include representatives of the management and the independent accountants of the Company.  The Company shall cooperate timely with any reasonable due diligence request from or review conducted by the Manager or their agents from time to time in connection with the transactions contemplated by this Agreement, including, without limitation, providing information and available documents and access to appropriate senior corporate officers and the Company’s agents during regular business hours and at the Company’s principal offices, and timely furnishing or causing to be furnished such certificates, letters and opinions from the Company, its officers and its agents, as the Manager may reasonably request.  
(q)The Company consents to the Manager trading in the Common Stock for the Manager’s own accounts and for the account of its clients at the same time as sales of the Shares occur pursuant to this Agreement or pursuant to a Terms Agreement.  
(r)The Company will disclose in its Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q, as applicable, the number of Shares sold through the Manager under this Agreement, the Net Proceeds to the Company and the compensation paid by the Company with respect to sales of Shares pursuant to this Agreement during the relevant quarter.  
(s)If to the knowledge of the Company, the conditions set forth in Section 6(a), 6(f) or 6(h) shall not be true and correct on the applicable Settlement Date, the Company will offer to any person who has agreed to purchase Shares from the Company as the result of an offer to purchase solicited by the Manager the right to refuse to purchase and pay for such Shares.  
(t)Each acceptance by the Company of an offer to purchase the Shares hereunder, and each execution and delivery by the Company of a Terms Agreement, shall be deemed to be an affirmation to the Manager that the representations and warranties of the Company contained in or made pursuant to this Agreement are true and correct as of the date of such acceptance or of such Terms Agreement as though made at and as of such date, and an undertaking that such representations and warranties will be true and correct as of the Settlement Date for the Shares relating to such acceptance or as of the Time of Delivery relating to such sale, as the case may be, as though made at and as of such date (except that such representations and warranties shall be deemed to relate to the Registration Statement and the Prospectus as amended and supplemented relating to such Shares).  
(u)The Company shall ensure that there are at all times sufficient shares of Common Stock to provide for the issuance, free of any preemptive rights, out of its authorized but unissued shares of Common Stock or shares of Common Stock held in treasury, of the maximum aggregate number of Shares authorized for issuance by the 
						
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Board pursuant to the terms of this Agreement.  The Company will use its commercially reasonable efforts to cause the Shares to be listed for trading on Nasdaq and to maintain such listing.  
(v)During any period when the delivery of a prospectus relating to the Shares is required (including in circumstances where such requirement may be satisfied pursuant to Rule 172) to be delivered under the Securities Act, the Company will file all documents required to be filed with the Commission pursuant to the Exchange Act within the time periods required by the Exchange Act and the regulations thereunder.  
(w)The Company shall cooperate with the Manager and use its reasonable efforts to permit the Shares to be eligible for clearance and settlement through the facilities of DTC.  
(x)The Company will apply the Net Proceeds from the sale of the Shares in the manner set forth in the Prospectus.  
(y)The Company will notify promptly the Manager if the Company ceases to be an Emerging Growth Company at any time prior to the later of (a) completion of the distribution of the Shares within the meaning of the Securities Act and (b) completion of the restricted period referred to in Section 5(h) hereof.
5.Payment of Expenses.  
(a)The Company agrees to pay the costs and expenses incident to the performance of its obligations under this Agreement, whether or not the transactions contemplated hereby are consummated, including without limitation: (i) the preparation, printing or reproduction and filing with the Commission of the Registration Statement (including financial statements and exhibits thereto), the Prospectus and any Issuer Free Writing Prospectus, and each amendment or supplement to any of them; (ii) the printing (or reproduction) and delivery (including postage, air freight charges and charges for counting and packaging) of such copies of the Registration Statement, the Prospectus, and any Issuer Free Writing Prospectus, and all amendments or supplements to any of them, as may, in each case, be reasonably requested for use in connection with the offering and sale of the Shares; (iii) the preparation, printing, authentication, issuance and delivery of certificates for the Shares, including any stamp or transfer taxes in connection with the original issuance and sale of the Shares; (iv) the printing (or reproduction) and delivery of this Agreement, any blue sky memorandum and all other agreements or documents printed (or reproduced) and delivered in connection with the offering of the Shares; (v) the registration of the Shares under the Exchange Act and the listing of the Shares on Nasdaq; (vi) any registration or qualification of the Shares for offer and sale under the securities or blue sky laws of the several states (including filing fees and the reasonable fees and expenses of counsel for the Manager relating to such registration and qualification); (vii) any filings required to be made with the Financial Industry Regulatory Authority, Inc. (“FINRA”) (including filing fees and the reasonable fees and expenses of counsel for the Manager relating to such filings); (viii) the transportation and other expenses incurred by or on behalf of Company representatives in connection with presentations to prospective purchasers of the Shares; (ix) the fees and expenses of the Company’s accountants and the fees and expenses of counsel (including 
						
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local and special counsel) for the Company; (x) the reasonable documented out-of-pocket expenses of the Manager, including the reasonable fees, disbursements and expenses of counsel for the Manager in connection with this Agreement and the Registration Statement and ongoing services in connection with the transactions contemplated hereunder, in an amount not to exceed $50,000; and (xi) all other costs and expenses incident to the performance by the Company of its obligations hereunder.
6.Conditions to the Obligations of the Manager.  The obligations of the Manager under this Agreement and any Terms Agreement shall be subject to (i) the accuracy of the representations and warranties on the part of the Company contained herein as of the Execution Time (as applicable), each Representation Date, and as of each Applicable Time, Settlement Date and Time of Delivery, (ii) to the performance by the Company of its obligations hereunder and (iii) the following additional conditions:
(a)The Prospectus, and any supplement thereto, required by Rule 424 to be filed with the Commission have been filed in the manner and within the time period required by Rule 424(b) with respect to any sale of Shares; each Interim Prospectus Supplement shall have been filed in the manner required by Rule 424(b) within the time period required by Section 3(a)(ix) of this Agreement; any other material required to be filed by the Company pursuant to Rule 433(d) under the Securities Act, shall have been filed with the Commission within the applicable time periods prescribed for such filings by Rule 433; and no stop order suspending the effectiveness of the Registration Statement or any notice objecting to its use shall have been issued and no proceedings for that purpose shall have been instituted or threatened.
(b)The Company shall have requested and caused the Company Counsel, to furnish to the Manager, on every date specified in Section 4(l) of this Agreement, its opinion or Reliance Letter, as applicable, dated as of such date and addressed to the Manager, in form and substance reasonably satisfactory to the Manager.
(c)The Company shall have requested and caused the Company IP Counsel, to furnish to the Manager, on every date specified in Section 4(m) of this Agreement, its opinion, dated as of such date and addressed to the Manager, in form and substance reasonably satisfactory to the Manager.
(d)The Manager shall have received from Manager’s Counsel, on every date that the delivery of the Company Counsel legal opinion is required pursuant to Section 4(l) of this Agreement, such opinion or opinions or Reliance Letter, as applicable, dated as of such date and addressed to the Manager, with respect to the issuance and sale of the Shares, the Registration Statement, the Disclosure Package, the Prospectus (together with any supplement thereto) and other related matters as the Manager may reasonably require, and the Company shall have furnished to such counsel such documents as they request for the purpose of enabling them to pass upon such matters. 
(e)The Company shall have furnished or caused to be furnished to the Manager, on every date specified in Section 4(k) of this Agreement, a certificate of the Company, signed by the Chairman of the Board or the chief executive officer and the 
						
		24

principal financial or accounting officer of the Company, dated as of such date, to the effect that the signers of such certificate have carefully examined the Registration Statement, the Disclosure Package and the Prospectus and any supplements or amendments thereto and this Agreement and that:
(i)the representations and warranties of the Company in this Agreement are true and correct on and as of such date with the same effect as if made on such date and the Company has complied with all the agreements and satisfied all the conditions on its part to be performed or satisfied at or prior to such date;
(ii)no stop order suspending the effectiveness of the Registration Statement or any notice objecting to its use has been issued and no proceedings for that purpose have been instituted or, to the Company’s knowledge, threatened; and
(iii)since the date of the most recent financial statements included in the Disclosure Package, there has been no Material Adverse Effect, except as set forth in or contemplated in the Disclosure Package and the Prospectus.
(f)The Company shall have requested and caused the Accountants to have furnished to the Manager, on every date specified in Section 4(o) hereof and to the extent requested by the Manager in connection with any offering of the Shares, letters (which may refer to letters previously delivered to the Manager), dated as of such date, in form and substance reasonably satisfactory to the Manager, confirming that they are independent accountants within the meaning of the Securities Act and the Exchange Act and the respective applicable rules and regulations adopted by the Commission thereunder and that they have performed a review of any unaudited interim financial information of the Company included or incorporated by reference in the Registration Statement and the Prospectus in accordance with Statement on Auditing Standards No. 100.  
(g)Since the respective dates as of which information is disclosed in the Registration Statement, the Disclosure Package and the Prospectus, except as otherwise stated therein, there shall not have been (i) any change or decrease in financial statement items specified in the letter or letters referred to in paragraph (e) of this Section 6 or (ii) any change, or any development involving a prospective change, in or affecting the condition (financial or otherwise), earnings, business or properties of the Company and its subsidiaries taken as a whole, whether or not arising from transactions in the ordinary course of business, except as set forth in or contemplated in the Disclosure Package (exclusive of any amendment or supplement thereto) the effect of which, in any case referred to in clause (i) or (ii) above, is, in the sole judgment of the Manager, so material and adverse as to make it impractical or inadvisable to proceed with the offering or delivery of the Shares as contemplated by the Registration Statement (exclusive of any amendment thereof), the Disclosure Package and the Prospectus (exclusive of any amendment or supplement thereto). 
						
		25

(h)Between the Execution Time and the time of any sale of Shares through the  Manager, there shall not have been any decrease in the rating of any of the Company’s debt securities by any “nationally recognized statistical rating organization” (as defined for purposes of Rule 436(g) under the Securities Act) or any notice given of any intended or potential decrease in any such rating or of a possible change in any such rating that does not indicate the direction of the possible change.  
(i)FINRA shall not have raised any objection with respect to the fairness and reasonableness of the terms and arrangements under this Agreement.  
(j)The Shares shall have been listed and admitted and authorized for trading on Nasdaq, and satisfactory evidence of such actions shall have been provided to the Manager.
(k)Prior to each Settlement Date and Time of Delivery, as applicable, the Company shall have furnished to the Manager such further information, certificates and documents as the Manager may reasonably request.
If any of the conditions specified in this Section 6 shall not have been fulfilled when and as provided in this Agreement, or if any of the opinions and certificates mentioned above or elsewhere in this Agreement shall not be reasonably satisfactory in form and substance to the Manager and counsel for the Manager, this Agreement, as it relates to the Manager, and all obligations of the Manager hereunder may be canceled at, or at any time prior to, any Settlement Date or Time of Delivery, as applicable, by the Manager.  Notice of such cancellation shall be given to the Company in writing or by telephone or facsimile confirmed in writing.
The documents required to be delivered by this Section 6 shall be delivered at the office of Goodwin Procter LLP, counsel for the Manager, at 620 Eighth Avenue, New York, New York 10018, on each such date as provided in this Agreement.
7.Indemnification and Contribution.
(a)The Company agrees to indemnify and hold harmless the Manager, the directors, officers, employees, affiliates within the meaning of Rule 405 under the Securities Act and agents of the Manager and each person who controls the Manager within the meaning of either the Securities Act or the Exchange Act against any and all losses, claims, damages or liabilities, joint or several, to which they or any of them may become subject under the Securities Act, the Exchange Act or other Federal or state statutory law or regulation, at common law or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of a material fact contained in the registration statement for the registration of the Shares as originally filed or in any amendment thereof, or in the Base Prospectus, Prospectus, any Interim Prospectus Supplement or any Issuer Free Writing Prospectus or in any amendment thereof or supplement thereto or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary in order to make the statements therein not misleading, and agrees to reimburse each such indemnified party, 
						
		26

as incurred, for any legal or other expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, damage, liability or action; provided, however, that the Company will not be liable in any such case to the extent that any such loss, claim, damage or liability arises out of or is based upon any such untrue statement or alleged untrue statement or omission or alleged omission made therein in reliance upon and in conformity with written information furnished to the Company by the Manager specifically for inclusion therein.  This indemnity agreement will be in addition to any liability that the Company may otherwise have. The Company acknowledges that the last sentence of the first paragraph under “Plan of Distribution” and the name and contact information of the Manager in the Prospectus constitute the only information furnished in writing by or on behalf of the Manager for inclusion in the Prospectus or any Issuer Free Writing Prospectus.
(b)The Manager agrees to indemnify and hold harmless the Company, each of its directors, each of its officers who signs the Registration Statement, and each person who controls the Company within the meaning of either the Securities Act or the Exchange Act, to the same extent as the foregoing indemnity from the Company to the Manager, but only with reference to written information relating to the Manager furnished to the Company by the Manager specifically for inclusion in the documents referred to in the foregoing indemnity. This indemnity agreement will be in addition to any liability which the Manager may otherwise have.  
(c)Promptly after receipt by an indemnified party under this Section 7 of notice of the commencement of any action, such indemnified party will, if a claim in respect thereof is to be made against the indemnifying party under this Section 7, notify the indemnifying party in writing of the commencement thereof; but the failure so to notify the indemnifying party (i) will not relieve it from liability under paragraph (a) or (b) above unless and to the extent it did not otherwise learn of such action and such failure results in the forfeiture by the indemnifying party of substantial rights and defenses and (ii) will not, in any event, relieve the indemnifying party from any obligations to any indemnified party other than the indemnification obligation provided in paragraph (a) or (b) above. The indemnifying party shall be entitled to appoint counsel of the indemnifying party’s choice at the indemnifying party’s expense to represent the indemnified party in any action for which indemnification is sought (in which case the indemnifying party shall not thereafter be responsible for the fees and expenses of any separate counsel retained by the indemnified party or parties except as set forth below); provided, however, that such counsel shall be reasonably satisfactory to the indemnified party. Notwithstanding the indemnifying party’s election to appoint counsel to represent the indemnified party in an action, the indemnified party shall have the right to employ separate counsel (including local counsel), and the indemnifying party shall bear the reasonable and documented fees, costs and expenses of such separate counsel (which, if the Company is the indemnifying party, shall be limited to one such separate counsel, together with local counsel, for the Manager together with all persons who control the Manager within the meaning of the Exchange Act or the Securities Act) if (i) the use of counsel chosen by the indemnifying party to represent the indemnified party would present such counsel with a conflict of interest, (ii) the actual or potential defendants in, or targets of, any such action include both the indemnified party and the indemnifying 
						
		27

party and the indemnified party shall have reasonably concluded that there may be legal defenses available to it and/or other indemnified parties which are different from or additional to those available to the indemnifying party, (iii) the indemnifying party shall not have employed counsel reasonably satisfactory to the indemnified party to represent the indemnified party within a reasonable time after notice of the institution of such action or (iv) the indemnifying party shall authorize the indemnified party to employ separate counsel at the expense of the indemnifying party.  An indemnifying party will not, without the prior written consent of the indemnified parties (which shall not be unreasonably withheld), settle or compromise or consent to the entry of any judgment with respect to any pending or threatened claim, action, suit or proceeding in respect of which indemnification or contribution may be sought hereunder (whether or not the indemnified parties are actual or potential parties to such claim or action) unless such settlement, compromise or consent: (i) includes an unconditional release of each indemnified party from all liability arising out of such claim, action, suit or proceeding and (ii) does not include a statement as to or an admission of fault, culpability or a failure to act, by or on behalf of any indemnified party.
(d)In the event that the indemnity provided in paragraph (a), (b) or (c) of this Section 7 is unavailable to or insufficient to hold harmless an indemnified party for any reason, the Company and the Manager agree to contribute to the aggregate losses, claims, damages and liabilities (including legal or other expenses reasonably incurred in connection with investigating or defending the same) (collectively “Losses”) to which the Company and the Manager may be subject in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and by the Manager on the other from the offering of the Shares.  If the allocation provided by the immediately preceding sentence is unavailable for any reason, the Company and the Manager severally shall contribute in such proportion as is appropriate to reflect not only such relative benefits but also the relative fault of the Company on the one hand and of the Manager on the other in connection with the statements or omissions which resulted in such Losses as well as any other relevant equitable considerations.  Benefits received by the Company shall be deemed to be equal to the total net proceeds from the offering (before deducting expenses) received by it, and benefits received by the Manager shall be deemed to be equal to the gross compensation received by the Manager with respect to the Shares purchased under this Agreement, in each case as determined by this Agreement or any applicable Terms Agreement. Relative fault shall be determined by reference to, among other things, whether any untrue or any alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information provided by the Company on the one hand or the Manager on the other, the intent of the parties and their relative knowledge, access to information and opportunity to correct or prevent such untrue statement or omission.  The Company and the Manager agree that it would not be just and equitable if contribution were determined by pro rata allocation or any other method of allocation which does not take account of the equitable considerations referred to above.  Notwithstanding the provisions of this paragraph (d), in no event shall the Manager be required to contribute any amount in excess of the amount by which the gross compensation applicable to the Shares purchased by the Manager hereunder exceeds the amount of any damages that the Manager has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or 
						
		28

alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.  For purposes of this Section 7, each person who controls the Manager within the meaning of either the Securities Act or the Exchange Act and each director, officer, employee, affiliate within the meaning of Rule 405 under the Securities Act and agent of the Manager shall have the same rights to contribution as the Manager, and each person who controls the Company within the meaning of either the Securities Act or the Exchange Act, each officer of the Company who shall have signed the Registration Statement and each director of the Company shall have the same rights to contribution as the Company, subject in each case to the applicable terms and conditions of this paragraph (d). 
(e)If an indemnified party shall have requested an indemnifying party to reimburse the indemnified party for reasonable fees and expenses of counsel, such indemnifying party agrees that it shall be liable for any settlement of the nature contemplated by this Section 7 effected without its written consent if (1) such settlement is entered into more than 45 days after receipt by such indemnifying party of the aforesaid request, (2) such indemnifying party shall have received notice of the terms of such settlement at least 30 days prior to such settlement being entered into and (3) such indemnifying party shall not have reimbursed such indemnified party in accordance with such request prior to the date of such settlement.
8.Termination.
(a)The Company shall have the right, by giving written notice as hereinafter specified, to terminate the provisions of this Agreement relating to the solicitation of offers to purchase the Shares in its sole discretion at any time.  Any such termination shall be without liability of any party to any other party except that (i) if Shares have been sold through the Manager for the Company, then Section 4(t) shall remain in full force and effect, (ii) with respect to any pending sale, through the Manager for the Company, the obligations of the Company, including in respect of compensation of the Manager, shall remain in full force and effect notwithstanding the termination and (iii) the provisions of Sections 2, 5, 7, 10, 11, 13 and 15 of this Agreement shall remain in full force and effect notwithstanding such termination.  
(b)The Manager shall have the right, by giving written notice as hereinafter specified, to terminate its obligations under this Agreement relating to the solicitation of offers to purchase the Shares in its sole discretion at any time.  Upon a termination by the Manager pursuant to this section, the provisions of Sections 2, 5, 7, 10, 11, 13 and 15 of this Agreement shall remain in full force and effect with respect to the Manager notwithstanding such termination. 
(c)This Agreement shall remain in full force and effect unless terminated pursuant to Sections 8(a) or (b) above or otherwise by mutual agreement of the parties; provided that any such termination by mutual agreement shall in all cases be deemed to provide that Sections 2, 5, 7 and 10 shall remain in full force and effect. 
						
		29

(d)Any termination of this Agreement shall be effective on the date specified in such notice of termination; provided that such termination shall not be effective until the close of business on the date of receipt of such notice by the Manager or the Company, as the case may be.  If such termination shall occur prior to the Settlement Date or Time of Delivery for any sale of the Shares, such sale shall settle in accordance with the provisions of Section 3(a)(vii) of this Agreement.
(e)In the case of any purchase of Shares by the Manager pursuant to a Terms Agreement, the obligations of the Manager pursuant to such Terms Agreement shall be subject to termination, in the absolute discretion of the Manager, by notice given to the Company prior to the Time of Delivery relating to such Shares, if at any time prior to such delivery and payment (i) trading in the Company’s Common Stock shall have been suspended by the Commission or Nasdaq or trading in securities generally on the NYSE or Nasdaq shall have been suspended or limited or minimum prices shall have been established on either of such exchanges, (ii) a banking moratorium shall have been declared either by Federal or New York State authorities or (iii) there shall have occurred any outbreak or escalation of hostilities, declaration by the United States of a national emergency or war, or other calamity or crisis the effect of which on financial markets is such as to make it, in the sole judgment of the Manager, impractical or inadvisable to proceed with the offering or delivery of the Shares as contemplated by the Prospectus (exclusive of any amendment or supplement thereto). 
9.Recognition of the U.S. Special Resolution Regimes. 
(a)     In the event that the Manager that is a Covered Entity becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer from the Manager of this Agreement, and any interest and obligation in or under this Agreement, will be effective to the same extent as the transfer would be effective under the U.S. Special Resolution Regime if this Agreement, and any such interest and obligation, were governed by the laws of the United States or a state of the United States.
(b)     In the event that the Manager that is a Covered Entity or a BHC Act Affiliate of the Manager becomes subject to a proceeding under a U.S. Special Resolution Regime, Default Rights under this Agreement that may be exercised against the Manager are permitted to be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if this Agreement were governed by the laws of the United States or a state of the United States.
10.Representations and Indemnities to Survive.  The respective agreements, representations, warranties, indemnities and other statements of the Company or its officers and of the Manager set forth in or made pursuant to this Agreement will remain in full force and effect, regardless of any investigation made by the Manager or the Company or any of the officers, directors, employees, affiliates, agents or controlling persons referred to in Section 7 hereof, and will survive delivery of and payment for the Shares.  
11.Notices.  All communications hereunder will be in writing and effective only on receipt, and, if sent to the Manager, will be mailed, delivered or telefaxed to William Blair & Company, L.L.C., 150 North Riverside Plaza, Chicago, Illinois 60606, Attention: 
						
		30

General Counsel, Facsimile: (312) 551-4646; or, if sent to the Company, will be mailed, delivered or telefaxed to 11260 El Camino Real, Suite 100, San Diego, California 92130, Attention: Kris Hanson, Vice President and Head of Legal.
12.Successors.  This Agreement will inure to the benefit of and be binding upon the parties hereto and their respective successors and the officers, directors, employees, agents and controlling persons referred to in Section 8 hereof, and no other person will have any right or obligation hereunder.
13.No Fiduciary Duty. The Company hereby acknowledges that (a) the purchase and sale of the Shares pursuant to this Agreement is an arm’s-length commercial transaction between the Company, on the one hand, and the Manager and any affiliate through which it may be acting, on the other, (b) the Manager is acting solely as sales agent and/or principal in connection with the purchase and sale of the Company’s securities and not as fiduciary of the Company and (c) the Company’s engagement of the Manager in connection with the offering and the process leading up to the offering is as an independent contractor and not in any other capacity.  Furthermore, the Company agrees that it is solely responsible for making its own judgments in connection with the offering (irrespective of whether the Manager has advised or is currently advising the Company on related or other matters).  The Company agrees that it will not claim that the Manager has rendered advisory services of any nature or respect, or owe an agency, fiduciary or similar duty to the Company, in connection with such transaction or the process leading thereto.
14.Integration. This Agreement and any Terms Agreement supersede all prior agreements and understandings (whether written or oral) between the Company and the Manager with respect to the subject matter hereof.
15.Applicable Law.  This Agreement and any Terms Agreement will be governed by and construed in accordance with the laws of the State of New York applicable to contracts made and to be performed within the State of New York.
16.Waiver of Jury Trial.  The Company hereby irrevocably waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating to this Agreement, any Terms Agreement or the transactions contemplated hereby or thereby.
17.Counterparts.  This Agreement and any Terms Agreement may be signed in one or more counterparts, each of which shall constitute an original and all of which together shall constitute one and the same agreement. Delivery of a signed counterpart of this Agreement by electronic transmission (including in “.pdf” format) shall constitute valid and sufficient delivery thereof.
18.Headings.  The section headings used in this Agreement and any Terms Agreement are for convenience only and shall not affect the construction hereof.
19.Definitions.  The terms that follow, when used in this Agreement and any Terms Agreement, shall have the meanings indicated.
						
		31

“Applicable Time” shall mean, with respect to any Shares, the time of sale of such Shares pursuant to this Agreement or any relevant Terms Agreement.
“Base Prospectus” shall mean the base prospectus referred to in Section 2(a) above contained in the Registration Statement at the Execution Time.
“BHC Act Affiliate” shall mean “affiliate” as defined in, and shall be interpreted in accordance with, 12 U.S.C. § 1841(k). 
“Business Day” shall mean any day other than a Saturday, a Sunday or a legal holiday or a day on which banking institutions or trust companies are authorized or obligated by law to close in New York City.
“Commission” shall mean the Securities and Exchange Commission.
“Covered Entity” shall mean any of the following: (i) a “covered entity” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 252.82(b), (ii) a “covered bank” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 47.3(b) or (iii) a “covered FSI” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 382.2(b).
“Default Right” shall mean default right as defined and interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable.
“Disclosure Package” shall mean (i) the Prospectus, (ii) the most recently filed Interim Prospectus Supplement, (iii) the Issuer Free Writing Prospectuses, if any, identified in Schedule I hereto, (iv) the public offering price of Shares sold at the relevant Applicable Time and (v) any other Free Writing Prospectus that the parties hereto shall hereafter expressly agree in writing to treat as part of the Disclosure Package.
“Effective Date” shall mean each date and time that the Registration Statement, any post-effective amendment or amendments thereto and any Rule 462(b) Registration Statement became or becomes effective.
“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
“Execution Time” shall mean the date and time that this Agreement is executed and delivered by the parties hereto.
“Free Writing Prospectus” shall mean a free writing prospectus, as defined in Rule 405.
“Interim Prospectus Supplement” shall mean the prospectus supplement relating to the Shares prepared and filed pursuant to Rule 424(b) from time to time.
“Issuer Free Writing Prospectus” shall mean an issuer free writing prospectus, as defined in Rule 433.
						
		32

 “Registration Statement” shall mean the registration statement referred to in Section 2(a) above, including exhibits and financial statements and any prospectus supplement relating to the Shares that is filed with the Commission pursuant to Rule 424(b) and deemed part of such registration statement pursuant to Rule 430B, as amended on each Effective Date and, in the event any post-effective amendment thereto or any Rule 462(b) Registration Statement becomes effective, shall also mean such registration statement as so amended or such Rule 462(b) Registration Statement, as the case may be.  
“Rule 158”, “Rule 163”, “Rule 164”, “Rule 172”, “Rule 405”, “Rule 415”, “Rule 424”, “Rule 430B”, “Rule 433” and “Rule 462” refer to such rules under the Securities Act.
“Rule 462(b) Registration Statement” shall mean a registration statement and any amendments thereto filed pursuant to Rule 462(b) relating to the offering covered by the registration statement referred to in Section 1(a) hereof.
“Securities Act” shall mean the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
 “U.S. Special Resolution Regime” shall mean each of (i) the Federal Deposit Insurance Act and the regulations promulgated thereunder and (ii) Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act and the regulations promulgated thereunder.
 

						
		33

If the foregoing is in accordance with your understanding of our agreement, please sign and return to us the enclosed duplicate hereof, whereupon this letter and your acceptance shall represent a binding agreement among the Company and the Manager.
Very truly yours,
PhaseBio Pharmaceuticals, Inc.
By:     /s/ John Sharp    
Name: John Sharp
Title: Chief Financial Officer 
The foregoing Agreement is
hereby confirmed and accepted
as of the date first written above.

William Blair & Company, L.L.C.

By:    /s/ Steve Maletzky
Name: Steve Maletzky
Title: Partner, Equity Capital Markets

						
		

SCHEDULE I
Schedule of Free Writing Prospectuses included in the Disclosure Package

None. 
 
						
		

[Form of Terms Agreement]    ANNEX I

PHASEBIO PHARMACEUTICALS, INC.

Common Stock

TERMS AGREEMENT

______, 20__

William Blair & Company, L.L.C.
150 North Riverside Plaza
Chicago, Illinois 60606

Dear Sirs: 
PhaseBio Pharmaceuticals, Inc. (the “Company”) proposes, subject to the terms and conditions stated herein and in the Equity Distribution Agreement, dated November 10, 2021 (the “Equity Distribution Agreement”), between the Company, on the one hand, and William Blair & Company, L.L.C.  (the “Manager”), on the other, to issue and sell to William Blair & Company, L.L.C. the securities specified in Schedule I hereto (the “Purchased Shares”).
Each of the provisions of the Equity Distribution Agreement not specifically related to the solicitation by the Manager, as agent of the Company, of offers to purchase securities is incorporated herein by reference in its entirety, and shall be deemed to be part of this Terms Agreement to the same extent as if such provisions had been set forth in full herein.  Each of the representations and warranties set forth therein shall be deemed to have been made at and as of the date of this Terms Agreement and the Time of Delivery, except that each representation and warranty in Section 2 of the Equity Distribution Agreement which makes reference to the Prospectus (as therein defined) shall be deemed to be a representation and warranty as of the date of the Equity Distribution Agreement in relation to the Prospectus, and also a representation and warranty as of the date of this Terms Agreement and the Time of Delivery in relation to the Prospectus as amended and supplemented to relate to the Purchased Shares.
An amendment to the Registration Statement (as defined in the Equity Distribution Agreement), or a supplement to the Prospectus, as the case may be, relating to the Purchased Shares, in the form heretofore delivered to the Manager is now proposed to be filed with the Securities and Exchange Commission.
Subject to the terms and conditions set forth herein and in the Equity Distribution Agreement which are incorporated herein by reference, the Company agrees to issue and sell to William Blair & Company, L.L.C. and the latter agrees to purchase from the Company the number of shares of the Purchased Shares at the time and place and at the purchase price set forth in the Schedule I hereto.
						
		

If the foregoing is in accordance with your understanding, please sign and return to us a counterpart hereof, whereupon this Terms Agreement, including those provisions of the Equity Distribution Agreement incorporated herein by reference, shall constitute a binding agreement between William Blair & Company, L.L.C. and the Company.

						
	PhaseBio Pharmaceuticals, Inc.

	By:	
		Name:
		Title:
		

ACCEPTED as of the date
first written above.
						
	William Blair & Company, L.L.C.
		
		
	By:	
		Name:
		Title:
		

Form of Terms Agreement    Schedule I to the Terms Agreement

									
	Title of Purchased Shares:	
	Common Stock, par value $0.001 per share	
		
	Number of Shares of Purchased Shares:	
		
	Price to Public:	
		
	Purchase Price by William Blair & Company, L.L.C.:
	
		
	Method of and Specified Funds for Payment of Purchase Price:
		By wire transfer to a bank account specified by the Company in same day funds.
		
	Method of Delivery:
		Free delivery of the Shares to the Manager’s account at The Depository Trust Company in return for payment of the purchase price.
		
	Time of Delivery:	
		
	Closing Location:	
		
	Documents to be Delivered:	
		
		The following documents referred to in the Equity Distribution Agreement shall be delivered as a condition to the closing at the Time of Delivery:
                      (1)  The opinion or Reliance Letter, as applicable, referred to in Section 4(l).
(2)  The opinion referred to in Section 4(m).
(3)  The opinion or Reliance Letter, as applicable, referred to in Section 4(n).  
(4)  The accountants’ letter referred to in Section 4(o).
(5)  The officers’ certificate referred to in Section 4(k).
(6)  Such other documents as the Manager shall reasonably request.Exhibit
10.1

 

EXECUTIVE
EMPLOYMENT AGREEMENT

 

THIS
EXECUTIVE EMPLOYMENT AGREEMENT (“Agreement”), dated the 10th day of November, 2021 (the “Effective Date”),
is by and between PetVivo Holdings, Inc. a Nevada corporation (“Company”), and John Lai, a resident of Minnesota (“Executive”).

 

RECITALS

 

A.       Company
wishes to hire and Executive wishes to be employed by the Company in the capacity of Chief Executive Officer and President of the Company;
and

 

B.       In
connection with this Agreement, the Company and Executive are hereby terminating the Employment Agreement between the Company and Executive
dated October 1, 2019 (“Prior Employment Agreement”).

 

C.       In
consideration of the foregoing promises and the parties’ mutual covenants and undertakings contained in this Agreement, the Company
and Executive agree as follows:

 

Article
I.

DEFINITIONS

 

Capitalized
terms used in the Agreement shall have their defined meaning throughout the Agreement. The following terms shall have the meanings set
forth below, unless the context clearly requires otherwise.

 

1.1       “Accrued
Obligations” shall have the meaning set forth in Section 4.1(g).

 

1.2       “Base
Salary” shall have the meaning set forth in Section 3.1.

 

1.3       “Board”
means the Board of Directors of the Company.

 

1.4       “Cause”
shall have the meaning set forth in Section 4.1(c) of this Agreement.

 

1.5       “Company”
means all of the following, jointly and severally: (a) PetVivo Holdings, Inc; (b) any subsidiary; and (c) any successor.

 

1.6       “Confidential
Information” means information that is proprietary to the Company or proprietary to others and entrusted to the Company, whether
or not a trade secret. Confidential Information includes, but is not limited to, information relating to business and operating plans
and to business as conducted during Executive’s employment with the Company or anticipated to be conducted, as evidenced by Company
documents in existence as of the Termination Date, and to past or current or anticipated information as evidenced by Company documents
in existence (as of the Termination Date), products or services. Confidential Information also includes, without limitation, information
concerning research, development, purchasing, accounting, marketing, distribution and selling. All information that Executive has a reasonable
basis to consider confidential is Confidential Information, whether or not originated by Executive and without regard to the manner in
which Executive obtains access to this and any other proprietary information.

 

    	 

    	 

    

 

1.7       “Disability”
means the Executive’s inability by reason of physical or mental illness to fulfill his obligations hereunder for thirty (30)
consecutive days or a total of ninety (90) days (whether or not consecutive) in any 180-day period, which, in the reasonable opinion
of an independent physician selected by the Company or its insurers and reasonably acceptable to the Executive or the Executive’s
legal representative, renders the Executive unable to perform the essential functions of his job, even after reasonable accommodations
are made by the Company, and which inability by reason of such physical or mental illness to fulfill his obligations has not been cured,
as determined by such physician prior to the Termination Date.

 

1.8       “Executive”
means John Lai.

 

1.9       “Incentive
Plan” means the PetVivo Holdings, Inc. 2020 Equity Incentive Plan and any other equity compensation plans approved and adopted
by the Board of Directors and shareholders after the date of this Agreement.

 

1.10       “Inventions”
means all inventions, original works of authorship, developments, concepts, improvements, designs, discoveries, ideas, trademarks
(and all associated goodwill), mask works or trade secrets, whether or not such are patentable, copyrightable or protectable under any
statutory or regulatory scheme, and whether or not in writing or reduced to practice, which Executive may solely or jointly conceive
or develop or reduce to practice, or cause to be conceived or developed or reduced to practice, during Executive’s employment by
the Company.

 

1.11       “Stock
Award” means, individually or collectively, an option, stock appreciation right, restricted stock award, restricted stock unit,
deferred stock unit, performance award, or other stock-based award, in each case granted to the Executive pursuant to the Incentive Plan.

 

1.12       “Termination
Date” shall mean the date specified in the Termination Notice.

 

1.13       “Termination
Notice” shall have the meaning set forth in Section 4.1(f).

 

Article
II.

EMPLOYMENT,
DUTIES, AND TERM

 

2.1       Employment.
Upon the terms and conditions set forth in this Agreement, the Company hereby employs Executive, and Executive accepts such employment,
as the Chief Executive Officer and President of the Company. Except as expressly provided herein, termination of this Agreement by either
party or by mutual agreement of the parties shall also terminate Executive’s employment by the Company.

 

2.2       Duties.
During the Term (as defined in Section 2.5 of this Agreement), the Executive shall serve as the Chief Executive Officer and President
of the Company under the direction of the Board of Directors of the Company (the “Board”). During the Term the Executive
shall devote all of Executive’s business time, skill, and energies to promote the interests of the Company and to serve such positions
with the Company as may be reasonably assigned by the Board which are consistent with the title of Chief Executive Officer and President
of the Company. Executive shall undertake to perform all of Executive’s duties and responsibilities for the Company and any current
and/or future affiliates of the Company in good faith and on a full-time basis and shall at all times act in good faith in the course
of Executive’s employment under this Agreement and in the best interests of the Company and its affiliates.

 

    	2

    	 

    

 

2.3       Certain
Proprietary Information. If Executive possesses any proprietary information of another person or entity as a result of prior employment
or relationship, Executive shall honor any legal obligation that Executive has with that person or entity with respect to such proprietary
information.

 

2.4       No
Conflict. The Executive represents and warrants that Executive is not a party to or subject to any agreement, covenant, understanding,
or under any obligation, contractual or otherwise, to any firm, person or corporation, which would prevent his employment by the Company
or adversely affect his ability to serve as an executive of the Company, as herein contemplated.

 

2.5       Term.
Subject to the provisions of Article IV, the term of employment of Executive under this Agreement shall commence on the date set
forth above and continue until September 30, 2024 (the “Term”).

 

Article
III.

COMPENSATION,
BENEFITS AND EXPENSES

 

3.1       Base
Salary. The Company will pay to Executive an annual base salary (“Base Salary”) of $275,000 per year, less deductions
and withholdings, which Base Salary will be paid in accordance with the Company’s normal payroll policies and procedures. During
each year after the first year of Executive’s employment hereunder, the Compensation Committee of the Board (the “Committee”)
may review and increase Executive’s Base Salary in its sole discretion.

 

3.2       Award
Grants. During the Term, the Executive shall be eligible to receive one or more equity-based incentive awards at the discretion of
the Committee. The terms of such awards, if any, shall be determined in the sole discretion of the Committee, including the types of
awards, the number of securities covered by each award, the vesting conditions applicable to each award, and the manner in which awards
are to be paid or settled. Nothing herein shall obligate the Company to make an equity award to the Executive at any time.

 

3.3       Performance
Bonus Compensation. Executive may be eligible for a cash performance/incentive bonus that is approved and granted by the Committee
pursuant to the achievement of milestones established by the Committee; such a performance/incentive bonus (“Bonus”) shall
be equal to fifty percent (50%) of the Base Salary of the Executive or such other percentage as determined by the Committee. Any Bonus
shall be paid within seventy-four (74) days of the Company’s fiscal year end. The Committee will consider such performance-based
bonuses, including the milestones for such bonuses, for the Executive on a regular basis, which shall occur at least once each calendar
year.

 

3.4       Benefits
and Paid Time Off. Executive shall be eligible to participate in any and all executive or employee benefits, including but not limited
to any pension, equity incentive, health, welfare and fringe benefits Company maintains for its employees of similar tenure and grade,
subject to and on a basis consistent with the terms of each such Plan or program and consistent with executives of similar tenure or
grade. The Executive shall be entitled to paid time off in accordance with the Company’s employment policies addressing paid time
off.

 

    	3

    	 

    

 

3.5       Business
Expenses. The Company will reimburse Executive for all reasonable and necessary out-of-pocket business, travel and entertainment
expenses incurred by the Executive in the performance of the duties and responsibilities hereunder, subject to the Company’s normal
policies and procedures for expense verification and documentation.

 

Article
IV.

TERMINATION

 

4.1       Employment
Term. The Executive’s employment under this Agreement may be terminated prior to the end of the Term upon the earlier to occur
of any of the following events (at which time the Term shall be terminated):

 

(a)       Death.
The Executive’s employment hereunder shall terminate upon his death.

 

(b)       Disability.
The Company shall be entitled to terminate the Executive’s employment hereunder for Disability.

 

(c)       Cause.
The Company may terminate the Executive’s employment hereunder for Cause. For purposes of this Agreement, the term “Cause”
shall include, without limitation, the following: (i) conviction (or a plea of nolo contendere) by the Executive to a felony;
(ii) acts of fraud, dishonesty or misappropriation committed by the Executive and intended to result in substantial personal enrichment
at the expense of the Company; (iii) willful, intentional or reckless misconduct by the Executive in the performance of the Executive’s
material duties required by this Agreement which materially damage or are reasonably likely to materially damage the financial position
or reputation of the Company; or (iv) a material breach of this Agreement by the Executive which is not cured within thirty (30) days
following receipt by the Executive of a Termination Notice from the Company.

 

(d)       Without
Cause. The Company may terminate the Executive’s employment hereunder during the Term without Cause, for any reason, provided
that the Company delivers to the Executive the Termination Notice at least thirty (30) days in advance of the Termination Date.

 

(e)       Voluntarily.
The Executive may voluntarily terminate his employment hereunder, provided that the Executive delivers to the Company the Termination
Notice at least thirty (30) days in advance of the Termination Date.

 

(f)       Notice
of Termination. Any termination of the Executive’s employment hereunder by the Company or by the Executive during the Term
shall be communicated by written notice of termination to the other party hereto in accordance with Section 8.4 (the “Termination
Notice”). The Termination Notice shall specify: (i) the termination provisions of this Agreement relied upon, (ii) to the extent
applicable, the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under the provisions
so indicated, and (iii) the applicable date of termination (“Termination Date”).

 

    	4

    	 

    

 

(g)       Accrued
Obligations Upon Termination. Upon termination of Executive’s employment with the Company for any reason, the Company shall
be obligated to pay to Executive, all Base Salary earned by Executive through his last day of employment, and any earned and payable
(but as of yet unpaid) Annual Bonus for the previous year, any accrued but unused vacation/paid time off and any unreimbursed business
expenses to the extent incurred before the termination and for which he would have been entitled to reimbursement but for the termination
of employment (to the extent that they have been properly submitted or are due, or if not previously submitted or reviewed by the Company,
the Company shall promptly review them if promptly submitted by the Executive thereafter), which are referred to herein as the “Accrued
Obligations”.

 

4.2       Compensation
Upon Termination.

 

(a)       Disability
or Death. If the Executive’s employment is terminated as a result of his Disability or death, the Company shall pay, as soon
as practicable, but not later than sixty (60) days of such termination, to the Executive or to the Executive’s estate, as applicable,
the Accrued Obligations.

 

(b)       Termination
for Cause. If the Executive’s employment is terminated by the Board for Cause, then the Company shall pay to the Executive,
no later than the next pay date, the Accrued Obligations and the Executive shall have no further entitlement to any other compensation
or benefits from the Company.

 

(c)       Termination
by the Company without Cause. If the Executive’s employment is terminated by the Company other than as a result of the Executive’s
death or Disability and other than for Cause, then the Company shall pay to the Executive, no later than the next pay date, the Accrued
Obligations. In addition, the Company shall make a lump sum severance payment to the Executive in an amount equal to one (1) month of
his Base Salary, within ten (10) days following receipt of the Release required under Section 4.2(f).

 

(d)       Voluntary
Termination by the Executive. If the Executive voluntarily terminates his employment, then the Company shall pay to the Executive,
no later than the next pay date, the Accrued Obligations.

 

(e)       Stock
Awards. If the Executive’s employment is terminated for any reason, the vesting, exercisability and termination of the Stock
Awards shall be determined by the terms in the award agreement for each Stock Award and/or the terms of the Incentive Plan.

 

(f)       Release.
The Company shall have no obligation to make any severance payment under Section 4.2(c) unless the Executive executes and delivers (without
revoking) to the Company within sixty (60) days following the Executive’s Termination Date a general release in form and substance
satisfactory to the Company of any and all claims he may have against the Company and its affiliates (the “Release”).

 

    	5

    	 

    

 

(g)       Exclusive
Obligations. This Section 4.2 sets forth the only obligations of the Company with respect to the termination of the Executive’s
employment with the Company, and the Executive acknowledges that, upon the termination of his employment, he shall not be entitled to
any payments or benefits which are not explicitly provided in this Section 4. The provisions of this Section 4.2 shall survive any termination
of this Agreement.

 

4.3       Return
of Property. Upon termination of Executive’s employment for any reason, be it voluntary or involuntary, Executive shall promptly
deliver to the Company (a) all records, manuals, books, documents, client lists, letters, reports, data, tables, calculations, prototypes
and any and all copies of any of the foregoing which are the property of the Company or which relate in any way to the business or practices
of the Company, and (b) all other property of the Company and Confidential Information which in any of these cases are in his possession
or under his control. Executive shall not retain any copies or summaries of any kind of documents and materials covered by this Section
4.3.

 

Article
V.

CONFIDENTIAL INFORMATION

 

5.1       Prohibitions
Against Use. Executive will not, during or subsequent to the termination of Executive’s employment under this Agreement, use
or disclose, other than in connection with Executive’s employment with the Company, any Confidential Information to any person
not employed by the Company or not authorized by the Company to receive such Confidential Information, without the prior written consent
of the Company. Executive will use reasonable and prudent care to safeguard and protect and prevent the unauthorized use and disclosure
of Confidential Information. The obligations contained in this Section 5.1 will survive for as long as the Company in its sole judgment
considers the information to be Confidential Information. The obligations under this Section 5.1 will not apply to any Confidential Information
that is now or becomes generally available to the public through (a) no fault of Executive or (b) to Executive’s disclosure of
any Confidential Information required by law or judicial or administrative process.

 

5.2       Proprietary
Information. If Executive has possessed or possesses any proprietary information of another person or entity as a result of prior
employment or relationship, Executive shall honor any legal obligation that Executive has with that person or entity with respect to
such proprietary information.

 

Article
VI.

NON-COMPETITION

 

6.1       Non-Competition.
Subject to Sections 6.2 and 6.3, Executive agrees that during the Term of this Agreement and for a period of one (1) year following
termination of his employment for any reason, Executive will not, anywhere in the world, directly or indirectly, alone or as a partner,
officer, director, shareholder or employee of any other firm or entity, engage in any commercial activity in competition with the Company
which activity involves the development, distribution, sales or marketing of manufactured biomaterials containing proteins including,
but not limited to, collagen-, elastin-, casein- or fibrin-containing products for any medical application. For purposes of this paragraph,
“shareholder” shall not include beneficial ownership of less than five percent (5%) of the combined voting power of all issued
and outstanding voting securities of a publicly held corporation whose stock is traded on a major stock exchange or quoted on a major
stock exchange.

 

    	6

    	 

    

 

6.2       Covenant
Not to Recruit. Executive recognizes that the Company’s workforce constitutes an important and vital aspect of its business
on a world-wide basis. Executive agrees that for a period of one (1) year following the termination of this Agreement for any reason
whatsoever, he shall not solicit, or assist anyone else in the solicitation of, any of the Company’s then-current employees to
terminate their employment with the Company and to become employed by any business enterprise with which the Executive may then be associated,
affiliated or connected.

 

6.3       Judicial
Modification. If any of the foregoing covenants are deemed by a court of competent jurisdiction to be unenforceable because of their
scope or duration, or the area or subject matter covered thereby, the Company and Executive agree that the court making such determination
shall have the power to reduce or modify the scope, duration, subject matter and/or area of such covenant to the extent that allows the
maximum scope, duration, subject matter and area permitted by applicable law.

 

Article
VII.

INVENTIONS

 

7.1       Assignment
of Inventions. Executive shall promptly make full, written disclosure to the Company, and will hold in trust for the sole right and
benefit of the Company, and hereby irrevocably transfers and assigns, and agrees to transfer and assign, to the Company, or its designee,
all his right, title and interest in and to any and all Inventions. Executive further acknowledges that all original works of authorship
which are made by Executive (solely or jointly with others) within the scope of and during the period of his employment with the Company
and which may be protected by copyright are “Works Made For Hire” as that term is defined by the United States Copyright
Act. Executive understands and agrees that the decision whether to commercialize or market any Invention developed by Executive (solely
or jointly with others) is within the Company’s sole discretion and the Company’s sole benefit and that no royalty will be
due to Executive as a result of the Company’s efforts to commercialize or market any such Invention.

 

Executive
recognizes that Inventions relating to his activities while working for the Company and conceived or made by Executive, whether alone
or with others, within one (1) year after cessation of Executive’s employment, may have been conceived in significant part while
employed by the Company. Accordingly, Executive acknowledges and agrees that such Inventions shall be presumed to have been conceived
during Executive’s employment with the Company and are to be, and hereby are, assigned to the Company unless and until Executive
has established the contrary.

 

The
requirements of this Section 7.1 do not apply to any intellectual property for which no equipment, supplies, facility or trade secret
information of the Company was used, and which was developed entirely on the Executive’s own time, and (a) which does not relate
(i) directly to the Company’s business or (ii) to the Company’s actual or demonstrably anticipated research and development
or (b) which does not result from any work the Executive performed for the Company.

 

    	7

    	 

    

 

7.2       Maintenance
of Records. Executive agrees to keep and maintain adequate and current written records of all Inventions made by Executive (solely
or jointly with others) during his employment with the Company. The records will be in the form of notes, sketches, drawings and any
other format that may be specified by the Company. The records will be available to and remain the sole property of the Company at all
times.

 

7.3       Trademark
and Copyright Registrations. Executive agrees to assist the Company, or its designee, at the Company’s expense, in every proper
way to secure the Company’s rights in the Inventions and any copyrights, patents, trademarks, service marks, mask works, or any
other intellectual property rights in any and all countries relating thereto, including, but not limited to, the disclosure to the Company
of all pertinent information and data with respect thereto, the execution of all applications, specifications, oaths, assignments and
all other instruments the Company reasonably deems necessary in order to apply for and obtain such rights and in order to assign and
convey to the Company, its successors, assigns, and nominees the sole and exclusive rights, title, and interest in and to such inventions,
and any copyrights, patents, trademarks, service marks, mask works, or any other intellectual property rights relating thereto. Executive
further agrees that his obligation to execute or cause to be executed, when it is in his power to do so, any such instrument or paper
shall continue after termination or expiration of this Agreement or the cessation of his employment with the Company. If the Company
is unable, because of Executive’s mental or physical incapacity or for any other reason, after reasonably diligent efforts, to
secure Executive’s signature to apply for or to pursue any application for any United States or foreign patents, trademarks or
copyright registrations covering inventions or original works of authorship assigned to the Company as above, then Executive hereby irrevocably
designates and appoints the Company and its duly authorized officers and agents as Executive’s agent and attorney-in-fact to act
for and on his behalf and stead to execute and file any such applications and to do all other lawfully permitted acts to further the
prosecution and issuance of letters, patents, trademarks or copyright registrations thereon with the same legal force and effect as if
executed by Executive; this power of attorney shall be a durable power of attorney which shall come into existence upon Executive’s
mental or physical incapacity.

 

7.4       Prior
Inventions. Executive has identified on Exhibit A to this Agreement all Inventions relating in any way to the Company’s business
or demonstrably anticipated research and development that were made by Executive prior to employment with the Company, and Executive
represents that such list is complete. Executive represents that Executive has no rights in any such Inventions other than those specified
in Exhibit A. If there is no such list on Exhibit A, Executive represents that Executive has made no such Inventions at the time of signing
this Agreement. Executive shall not incorporate, or permit to be incorporated, any prior Invention owned by Executive or in which he
has an interest in a Company product, process or machine without the Company’s prior written consent.

 

    	8

    	 

    

 

Article
VIII.

GENERAL PROVISIONS

 

8.1       No
Adequate Remedy. The parties declare that it is impossible to accurately measure in money the damages which will accrue to either
party by reason of a failure to perform any of the obligations under this Agreement. Therefore, if either party shall institute any action
or proceeding to enforce the provisions hereof, other than a claim by Executive for a payment pursuant to Section 4 of this Agreement,
the party against whom such action or proceeding is brought hereby waives the claim or defense that such party has an adequate remedy
at law, and such party shall not assert in any such action or proceeding the claim or defense that such party has an adequate remedy
at law.

 

8.2       Arbitration.
Any claim arising out of or relating to Executive’s employment with the Company including claims: (a) arising out of termination
or discipline (including constructive discharge) or any denial of promotion; (b) relating to breach of contract (express or implied);
(c) relating to tort; (d) relating to wages or other compensation due; (e) relating to benefits (except claims under an employee benefit
or pension plan that either (i) specifies that its claims procedures shall culminate in an arbitration procedure different from this
one, or (ii) is underwritten by a commercial insurer which decides claims; (f) concerning discrimination disputes (including, but not
limited to race, sex, sexual orientation, religion, national origin, age, marital status, or disability), including complaints regarding
hostile work environment, or other prohibited discriminatory conduct; and (g) concerning violation of any law, statute, regulation or
ordinance, shall be settled by arbitration administered by the American Arbitration Association under its National Rules for the Resolution
of Employment Disputes and judgment upon the award rendered by the arbitrator(s) may be entered in any court having jurisdiction thereof.

 

Notwithstanding
the above, claims that are not arbitrable are those for injunctive and/or other equitable relief, including but not limited to those
for unfair competition and the use or disclosure of Confidential Information, as to which the Executive agrees that the Company may seek
and obtain relief from a court of competent jurisdiction. Claims for workers’ compensation or unemployment compensation benefits
are also excluded from this requirement for arbitration.

 

The
aggrieved party must give written notice to the other party of any claim. The written notice shall identify and describe the nature of
the claims asserted and the facts upon which such claims are based. Except for such claims listed above which are not arbitrable, for
all other claims this Section 8.2 specifically includes a waiver of the right to a court trial and a trial by jury.

 

8.3       Successor
and Assigns. This Agreement shall be binding upon the parties hereto, their heirs, devisees, legal representatives, administrators,
successors and assigns. Company may assign any or all of its rights and delegate its duties under this Agreement including, without limitation,
those contained in the restrictive covenants provided in Section 6 of this Agreement without the consent of Executive to any subsidiary
or affiliate of Company, to the purchaser of all or substantially all of Company’s assets or stock, or any other successor to Company’s
business. In such case, the covenants and agreements made by Executive herein shall inure to the benefit of and protect Company’s
assigns or the successors in interest. This Agreement is personal to the Executive and may not be assigned by him. Except as provided
in this Section, no party may assign or transfer his or its interests herein, or delegate his or its duties hereunder, without the written
consent of the other party. Any assignment or delegation of duties in violation of this provision shall be null and void.

 

    	9

    	 

    

 

8.4       Notices.
All notices, requests and demands given to or made pursuant hereto shall, except as otherwise specified herein, be in writing and
be personally delivered or mailed via overnight courier, with written confirmation of receipt, to the Company at its registered principal
office or to the Executive at the address reflected in the Company’s employment records as Executive’s address. Either party
may, by notice hereunder, designate a changed address. All notices and other communications given to any party hereto in accordance with
the provisions of this Agreement will be deemed to have been given on the date of delivery if personally delivered or on the business
day after the date when sent if sent by overnight courier, in each case addressed to such party as provided in this Section 8.4 or in
accordance with the latest unrevoked direction from such party.

 

8.5       Captions;
Construction. The various headings or captions in this Agreement are for convenience only and shall not affect the meaning or interpretation
of this Agreement. Whenever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Agreement shall be prohibited by or invalid under applicable law, such provision shall
be ineffective only to the extent of such prohibition or invalidity without invalidating the remainder of such provision or the remaining
provisions of this Agreement.

 

8.6       Governing
Law. The validity, interpretation, construction, performance, enforcement and remedies of or relating to this Agreement, and the
rights and obligations of the parties hereunder, shall be governed by the substantive laws of the State of Minnesota (without regard
to the conflict of laws, rules or statutes of any jurisdiction), and any and every legal proceeding arising out of or in connection with
this Agreement shall be brought in the appropriate courts of the State of Minnesota, each of the parties hereby consenting to the exclusive
jurisdiction of said courts for this purpose.

 

8.7       Waivers.
No failure on the part of either party to exercise, and no delay in exercising, any right or remedy hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise or any right or remedy hereunder preclude any other or further exercise thereof
or the exercise of any other right or remedy granted hereby or by any related document or by law.

 

8.8       Section
409A. It is the parties’ intention that any severance payment under Section 4.2(c) of this Agreement will be exempt from
the requirements of Section 409A of the Internal Revenue Code, and guidance issued thereunder (“Section 409A”) as
a short term deferral under Treas. Reg. Sec. 1.409A-1(b)(4) and this Agreement shall be construed and administered in a manner consistent
with such intent. Payments on account of a termination of employment may only be made upon a “separation from service” as
defined under Section 409A. To the extent the payments under this Agreement are subject to Section 409A, the Agreement shall be interpreted
and administered in a manner that complies with Section 409A. If at the time of the Executive’s termination of employment Executive
is a “specified” employee under Section 409A, then any payment or payments of deferred compensation subject to Section 409A
that are payable on account of such termination shall not be made or commenced until the first day following the earlier of (a) the expiration
of the six (6)-month period measured from the date of the “separation from service”, or (b) the date of Executive’s
death.

 

    	10

    	 

    

 

8.9       Entire
Agreement, Modification. This Agreement constitutes the entire agreement and understanding between the parties hereto in reference
to all the matters herein agreed upon. This Agreement replaces in full all prior employment agreements, consulting agreements or understandings
of the parties hereto, and any and all such prior agreements or understandings are hereby rescinded by mutual agreement. This Agreement
may not be modified or amended except by a written instrument signed by the parties hereto.

 

8.10       Execution
in Counterparts. This Agreement may be executed by each party in separate counterparts and by facsimile or PDF signatures, and each
such duly executed counterpart shall be of the same validity, force and effect as the original.

 

8.11       Survival.
The parties expressly acknowledge and agree that the provisions of this Agreement which by their express or implied terms extend
beyond the termination of Executive’s employment hereunder (including, without limitation, the provisions of Sections 3.3, 3.4,
and 4.2 or beyond the termination of this Agreement (including, without limitation, the provisions of Article V, Article VI and Article
VII) shall continue in full force and effect notwithstanding Executive’s termination of employment hereunder or the termination
of this Agreement, respectively.

 

[Remainder
of Page Intentionally Left Blank]

 

    	11

    	 

    

 

IN
WITNESS WHEREOF, the parties hereto have caused this Executive Employment Agreement to be duly executed and delivered as of the date
first above written.

  

	EXECUTIVE	 	PETVIVO
    HOLDINGS, INC.
	 	 	 	 	 
	By:	/s/
    John Lai	 	By:	/s/
    Robert J. Folkes
	 	John
    Lai	 	 	 Robert
    J. Folkes, Chief Financial Officer

  

    	12

    	 

    

 

SCHEDULE
A

 

Prior
Inventions

 

None

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