Document:

Warrant
      No.

              	
                Exhibit
      4.3

              

      

    

     

    VENTRUS
BIOSCIENCES, INC.

    COMMON
STOCK WARRANT

     

    THIS
WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “ACT”), OR
UNDER THE SECURITIES LAWS OF ANY STATE.  THIS WARRANT IS SUBJECT TO
RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD
EXCEPT AS PERMITTED UNDER THE ACT AND THE APPLICABLE STATE SECURITIES LAWS,
PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM.  THE ISSUER OF THIS
WARRANT MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO
THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE
WITH THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS.

     

    THIS
WARRANT HAS BEEN ISSUED UNDER AND IS SUBJECT TO THE TERMS AND PROVISIONS OF THE
SUBSCRIPTION AGREEMENT DATED AS OF [__________] BETWEEN VENTRUS BIOSCIENCES,
INC. (THE “COMPANY”) AND THE
HOLDER, AS IT MAY BE AMENDED, SUPPLEMENTED AND/OR RESTATED FROM TIME TO TIME
(THE “SUBSCRIPTION
AGREEMENT”).

    

    This
certifies that [__________] (the “Holder”), its
designees or permitted assigns, subject to the terms and conditions set forth
herein, at any time after the Commencement Date and prior to the Expiration Date
(as such terms are defined below), is entitled to purchase from Ventrus
Biosciences, Inc., a Delaware corporation (the “Company”),
[__________] fully-paid and non-assessable shares (subject to adjustment as
provided herein) (the “Warrant Shares”) of
the Company’s Common Stock, $0.001 par value per share (the “Common Stock”), upon
surrender to the Company at its principal office (or at such other location as
the Company may advise the Holder in writing) of this Warrant properly endorsed
with the Form of Subscription attached hereto duly completed and signed and upon
payment of the aggregate Exercise Price (as defined below) for the number of
Warrant Shares for which this Warrant is being exercised determined in
accordance with the provisions hereof.  The exercise price (the “Exercise Price”) per
Warrant Share issuable pursuant to this Common Stock Warrant shall be equal to
$5.36 per share.

     

    This
Warrant is issued subject to the following terms and conditions:

     

    1.           Exercise, Issuance of
Certificates.  The Holder may exercise this Warrant, at any
time or from time to time, during the period (a) commencing at 5:00 p.m.
(Eastern Time) on [__________], 2008 (the “Commencement Date”),
and (b) expiring at 5:00 p.m. (Eastern Time) on [__________], 2015 (the “Expiration
Date”).  The Holder may exercise this Warrant on or prior to
the Expiration Date for all or any part of the Warrant Shares (but not for a
fraction of a share) that may be purchased hereunder, as that number may be
adjusted pursuant to Section 3 of this Warrant.  The Company agrees
that the Warrant Shares purchased under this Warrant shall be and are deemed to
be issued to the Holder hereof as the record owner of such Warrant Shares as of
the close of business on the date on which this Warrant shall have been
surrendered, properly endorsed, the completed and executed Form of Subscription
delivered, and payment made for such Warrant Shares (such date, a “Date of
Exercise”).  Certificates for the Warrant Shares so purchased,
together with any other securities or property to which the Holder hereof is
entitled upon such exercise, shall be delivered to the Holder hereof by the
Company at the Company’s expense as soon as practicable after the rights
represented by this Warrant have been so exercised, but in any event not later
than ten (10) business days following the Date of Exercise.  In case
of a purchase of less than all the Warrant Shares which may be purchased under
this Warrant, the Company shall cancel this Warrant and execute and deliver to
the Holder hereof within a reasonable time a new Warrant or Warrants of like
tenor for the balance of the Warrant Shares purchasable under the Warrant
surrendered upon such purchase.  Each stock certificate so delivered
shall be registered in the name of such Holder and issued with a legend in
substantially the form of the legend placed on the front of this
Warrant.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    (a)           The
Company’s obligations to issue and deliver Warrant Shares in accordance with the
terms hereof are absolute and unconditional, irrespective of any action or
inaction by the Holder to enforce the same.  Nothing herein shall
limit a Holder’s right to pursue any other remedies available to it hereunder,
at law or in equity including, without limitation, a decree of specific
performance and/or injunctive relief with respect to the Company’s failure to
timely deliver certificates representing shares of Common Stock upon exercise of
the Warrant  as required pursuant to the terms hereof.

     

    (b)           Payment of Exercise
Price. The Holder shall pay the Exercise Price by delivering immediately
available funds to the Company.

     

    2.           Shares to be Fully Paid;
Reservation of Shares.  The Company covenants and agrees that
all Warrant Shares will, upon issuance and payment of the applicable Exercise
Price, be duly authorized, validly issued, fully paid and nonassessable, and
free of all preemptive rights, liens and encumbrances, except for restrictions
on transfer provided for herein.  The Company shall at all times
reserve and keep available out of its authorized and unissued Common Stock,
solely for the purpose of providing for the exercise of the rights to purchase
all Warrant Shares granted pursuant to this Warrant, such number of shares of
Common Stock as shall, from time to time, be sufficient therefor.

     

    3.           Adjustment of Exercise Price
and Number of Shares.  The Exercise Price and the total number
of Warrant Shares shall be subject to adjustment from time to time upon the
occurrence of certain events described in this Section 3.

     

    (a)           Subdivision or Combination
of Stock.  In the event the outstanding shares of the Company’s
Common Stock shall be increased by a stock dividend payable in Common Stock,
stock split, subdivision, or other similar transaction occurring after the date
hereof into a greater number of shares of Common Stock, the Exercise Price in
effect immediately prior to such subdivision shall be proportionately reduced
and the number of Warrant Shares issuable hereunder proportionately
increased.  Conversely, in the event the outstanding shares of the
Company’s Common Stock shall be decreased by reverse stock split, combination,
consolidation, or other similar transaction occurring after the date hereof into
a lesser number of shares of Common Stock, the Exercise Price in effect
immediately prior to such combination shall be proportionately increased and the
number of Warrant Shares issuable hereunder proportionately
decreased.

     

    (b)           Reclassification.  If
any reclassification of the capital stock of the Company or any reorganization,
consolidation, merger, or any sale, lease, license, exchange or other transfer
(in one transaction or a series of related transactions) of all or substantially
all, of the business and/or assets of the Company (the “Reclassification
Events”) shall be effected in such a way that holders of Common Stock
shall be entitled to receive stock, securities, or other assets or property,
then, as a condition of such Reclassification Event, lawful and adequate
provisions shall be made whereby the Holder hereof shall thereafter have the
right to purchase and receive (in lieu of the shares of Common Stock of the
Company immediately theretofore purchasable and receivable upon the exercise of
the rights represented hereby) such shares of stock, securities, or other assets
or property as may be issued or payable with respect to or in exchange for a
number of outstanding shares of such Common Stock equal to the number of shares
of such stock immediately theretofore purchasable and receivable upon the
exercise of the rights represented hereby.  In any Reclassification
Event, appropriate provision shall be made with respect to the rights and
interests of the Holder of this Warrant to the end that the provisions hereof
(including, without limitation, provisions for adjustments of the Exercise Price
and of the number of Warrant Shares), shall thereafter be applicable, as nearly
as may be, in relation to any shares of stock, securities, or assets thereafter
deliverable upon the exercise hereof.

    
      
         

      

      
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    (c)           Notice of
Adjustment.  Upon any adjustment of the Exercise Price or any
increase or decrease in the number of Warrant Shares, the Company shall give
written notice thereof, by first class mail postage prepaid, addressed to the
registered Holder of this Warrant at the address of such Holder as shown on the
books of the Company.  The notice shall be prepared and signed by the
Company’s Chief Financial Officer and shall state the Exercise Price resulting
from such adjustment and the increase or decrease, if any, in the number of
shares purchasable at such price upon the exercise of this Warrant, setting
forth in reasonable detail the method of calculation and the facts upon which
such calculation is based.

    

    4.           No Voting or Dividend
Rights.  Nothing contained in this Warrant shall be construed
as conferring upon the holder hereof the right to vote or to consent to receive
notice as a stockholder of the Company on any other matters or any rights
whatsoever as a shareholder of the Company.  No dividends or interest
shall be payable or accrued in respect of this Warrant or the interest
represented hereby or the shares purchasable hereunder until, and only to the
extent that, this Warrant shall have been exercised.

     

    5.           Compliance with the
Act. The Holder of this Warrant, by acceptance hereof, agrees that this
Warrant is being acquired for its own account and not for any other person or
persons, for investment purposes and that it will not offer, sell, or otherwise
dispose of this Warrant except under circumstances which will not result in a
violation of the Act or any applicable state securities laws.

     

    6.           Limited
Transferability.  The Holder represents that by accepting this
Warrant it understands that this Warrant and any securities obtainable upon
exercise of this Warrant have not been registered for sale under Federal or
state securities laws and are being offered and sold to the Holder pursuant to
one or more exemptions from the registration requirements of such securities
laws.  In the absence of an effective registration of such securities
or an exemption therefrom, any certificates for such securities shall bear the
legend set forth on the first page hereof.  The Holder understands
that it must bear the economic risk of its investment in this Warrant and any
securities obtainable upon exercise of this Warrant for an indefinite period of
time, as this Warrant and such securities have not been registered under Federal
or state securities laws and therefore cannot be sold unless subsequently
registered under such laws, unless an exemption from such registration is
available.

     

    7.           Amendment, Waiver,
etc.  Except as expressly provided herein, neither this Warrant
nor any term hereof may be amended, waived, discharged or terminated other than
by a written instrument signed by the party against whom enforcement of any such
amendment, waiver, discharge or termination is sought; provided, however, that
any provisions hereof may be amended, waived, discharged or terminated upon the
written consent of the Company and the holders of not less than two-thirds (2/3)
of the Warrant Shares then issuable upon exercise of then outstanding warrants
of like tenor to this Warrant issued by the Company in connection with the
offering to which the Subscription Agreement relates.

     

    8.           Notices.  Any
notice, request, or other document required or permitted to be given or
delivered to the Holder hereof or the Company shall be delivered as set forth in
the Subscription Agreement.

     

    9.           Governing
Law.  This Warrant shall be construed and enforced in
accordance with, and the rights of the parties shall be governed by, the laws of
the State of New York without regard to the conflicts of laws provisions
thereof.

    
      
         

      

      
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    10.         Lost or Stolen
Warrant.  Upon receipt of evidence reasonably satisfactory to
the Company of the loss, theft, destruction, or mutilation of this Warrant and,
in the case of any such loss, theft or destruction, upon receipt of an indemnity
reasonably satisfactory to the Company, or in the case of any such mutilation,
upon surrender and cancellation of such Warrant, the Company, at its expense,
will make and deliver a new Warrant, of like tenor, in lieu of the lost, stolen,
destroyed or mutilated Warrant.

     

    11.         Fractional
Shares.  No fractional shares shall be issued upon exercise of
this Warrant.  The Company shall, in lieu of issuing any fractional
share, pay the Holder entitled to such fraction a sum in cash equal to such
fraction (calculated to the nearest 1/100th of a share) multiplied by the then
effective Exercise Price on the date the Form of Subscription is received by the
Company.

     

    12.         Successors and
Assigns.  This Warrant and the rights evidenced hereby shall
inure to the benefit of and be binding upon the successors of the Company and
the successors and assigns of the Holder.  The provisions of this
Warrant are intended to be for the benefit of all Holders from time to time of
this Warrant, and shall be enforceable by any such Holder.

     

    13.         Severability of
Provisions. In case any one or more of the provisions of this Warrant
shall be invalid or unenforceable in any respect, the validity and
enforceability of the remaining terms and provisions of this Warrant shall not
in any way be affected or impaired thereby and the parties will attempt in good
faith to agree upon a valid and enforceable provision which shall be a
commercially reasonable substitute therefor, and upon so agreeing, shall
incorporate such substitute provision in this Warrant.

    
      
         

      

      
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    IN
WITNESS WHEREOF, the Company has caused this Warrant to be duly executed by its
officer, thereunto duly authorized as of this [___] day of [__________],
2008.

    

    
      
        
          	 
      	
                  VENTRUS
      BIOSCIENCES, INC.

                
	 
      	 
      	 
      
	 
      	
                  By: 

                	 
      
	 
      	
                  Name: 

                	 
      
	 
      	
                  Title:

                	 
      

        

      

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    FORM
OF SUBSCRIPTION

     

    (To be
signed only upon exercise of Warrant)

     

    To:       
  Ventrus Biosciences, Inc.

     

    The
undersigned, the holder of the attached Common Stock Warrant, hereby elects to
exercise the purchase right represented by such Warrant for, and to purchase
thereunder,                                    
shares of Common Stock of Ventrus Biosciences, Inc. and such holder herewith
makes payment of $_________ therefor.

     

    The
undersigned requests that certificates for such shares be issued in the name of,
and delivered to: ____
_______________________________________________________________________________________________
whose
address is:
____________________________________________________________.

     

    DATED:
___________________________

    

    
      
        
          
            
              	 
      
	
                      (Signature
      must conform in all respects to name of Holder as specified on the face of
      the Warrant)

                    
	 
      
	
                      Name: 

                    	 
      
	 
      	 
      
	
                      Title:Exhibit
4.4

     

    FUTURE
ADVANCE PROMISSORY NOTE

     

    
      
        
          	
                  FOR
      AMOUNTS ADVANCED

                
	
                  AS
      SHOWN ON SCHEDULE
      A

                	
                  New
      York, New York

                
	
                  ATTACHED
      HERETO

                	
                  ____________,
      20__

                

        

      

    

     

    For value
received, the undersigned, VENTRUS BIOSCIENCES, INC., a Delaware corporation
(the “Borrower”), having an address of 787 Seventh Avenue, New York, NY 10019,
hereby promises to pay to the order of __________________________, or its
permitted assigns (the “Holder”), having an address of 787 Seventh Avenue, New
York, NY 10019, at such place as the Holder may from time to time designate in
writing, in lawful currency of the United States of America, an amount equal to
the sum of all loans made by the Holder to the Borrower pursuant to Section 2
hereof in immediately available funds, together with interest at the rate
provided below, subject to the terms and conditions hereof.

     

    1.           Interest. Interest
shall accrue on the unpaid principal balance of this Note at a fixed rate equal
to eight percent (8%) per annum, and shall be payable on the Maturity Date, or,
if earlier, simultaneously with any prepayment pursuant to Section 5 below;
provided, however, that upon an
Event of Default (as defined below), the interest rate on this Note shall be
increased to twelve percent (12%) per annum. Simple interest from the date of
each advance as referenced on Schedule A attached
hereto shall be computed on the basis of a 360-day year of twelve 30-day
months.

     

    2.           Loans. From and after
the date hereof, but prior to the Maturity Date, or such later
date as the Holder and the Borrower may agree in writing, Borrower may request
the Holder to provide loans under this Note. For purposes of this Note, any
amounts which the Holder pays to third parties on behalf of the Borrower for
obligations arising out of the operations of the business of the Borrower shall
be considered a “loan.” Promptly after such request, if no Event of Default
shall have occurred and be continuing, the Holder or one or more if its
affiliates may provide such loan to the Borrower in the amount requested. The
Borrower hereby authorizes the Holder to record on the attached Schedule A the
principal amount of each loan made by the Holder or one or more of its
affiliates to the Borrower; provided, however, that any
failure by the Holder to record any such loan shall not affect the Borrower’s
obligation to repay such loan, together with interest thereon, in accordance
with this Note.

     

    3.           Maturity Date. The
unpaid principal balance of this Note, and all interest accrued thereon,
shall become immediately due and payable on the earliest to occur of the
following: (i) the ___ anniversary of the date hereof; (ii) the date of the
initial public offering of the Borrower’s securities pursuant to a registration
statement filed with the Securities and Exchange Commission in accordance with
the Securities Act of 1933, as amended; (iii) the first date on which the
Borrower’s securities (or any securities received in exchange for such
securities) trades on a national securities exchange, the Nasdaq SmallCap Market
or the Nasdaq National Market System or in the over-the-counter market; (iv)
consummation of an equity financing (whether in one transaction or a series of
related transactions) in which the gross proceeds to the Borrower equal or
exceed five million dollars ($5,000,000); (v) a Sale of the Borrower; or (vi) an
Event of Default (as defined below). For purposes hereof, a “Sale of the Borrower”
shall mean (x) the sale of all or substantially all of the Borrower’s assets;
(y) the sale or transfer of the outstanding shares of capital stock of the
Borrower; or (z) the merger or consolidation of the Borrower with another person
or entity, in each case in clauses (y) and (z) above under circumstances in
which the holders of the voting power of outstanding capital stock of the
Borrower, immediately prior to such transaction, own less than 50% in voting
power of the outstanding capital stock of the Borrower or the surviving or
resulting corporation or acquirer, as the case may be, immediately following
such transaction. A sale (or multiple related sales) of one or more subsidiaries
of the Borrower (whether by way of merger, consolidation, reorganization or sale
of all or substantially all assets or securities) which constitutes all or
substantially all of the consolidated assets of the Borrower shall be deemed a
Sale of the Borrower.
 

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    4.           Voluntary Prepayment.
All unpaid principal and interest on this Note may be prepaid in whole or in
part at any time without premium or penalty. Unless otherwise agreed or required
by applicable law, any voluntary prepayment by the Borrower will be applied
first to any unpaid collection costs and late charges, then to accrued and
unpaid interest, and then to principal.

     

    5.           Events of Default. An
“Event of
Default” shall occur:

     

    (a)           if
the Borrower shall default in the payment on the Note, when and as the same
shall become due and payable; or

     

    (b)          if
the Borrower shall default in the due observance or performance of any material
covenant, condition or agreement on the part of the Borrower contained in this
Note, and any such default shall continue for a period of five (5) days after
the Company receives notice thereof; or

     

    (c)           if
the Borrower shall default in the payment of the principal of, or any interest
on, any other debt or liability of the Borrower, when and as the same shall
become due and payable, if such default(s), in the aggregate, total at least
$25,000; or

     

    (d)          if
the Borrower commences any proceeding for dissolution, liquidation, winding up
or cessation of its business; or

     

    (e)           if
(i) the Borrower either (A) becomes insolvent, (B) is adjudicated insolvent or
bankrupt, (C) admits in writing its inability to pay its debts, (D) comes under
the authority of a custodian, receiver or trustee for it or for substantially
all of its assets, or (E) makes an assignment for the benefit of creditors; or
(ii) any proceeding under any law related to bankruptcy, insolvency, liquidation
or the reorganization, readjustment or the release of debtor is commenced by or
against the Borrower, and in the event any such proceeding is commenced against
it, such proceeding is not dismissed within sixty (60) days of
commencement.

     

    As soon
as practicable, but in any event within five (5) days after the Borrower becomes
aware of the existence of any Event of Default, or any event or condition which
after notice or lapse of time or both, reasonably could be expected to become an
Event of Default, the Borrower shall notify the Holder as to the existence of
such Event of Default or the nature of such event or
condition.
 

    
      
         

      

      
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    6.           Attorney’s Fees. If
the indebtedness represented by this Note or any part thereof is collected in
bankruptcy, receivership or other judicial proceedings or if this Note is placed
in the hands of attorneys for collection after default, the Borrower agrees to
pay, in addition to the principal and interest payable hereunder, reasonable
attorneys’ fees and costs incurred by Holder in collection.

     

    7.           Notices. All notices
and other communications provided for hereunder shall be in writing and
personally delivered, delivered by nationally-recognized overnight courier,
mailed, or sent by facsimile, to the applicable party’s address as set forth
above (or such other address as may be provided by Holder or Borrower in a
notice to the other pursuant to this Section). Any notice, demand or request so
delivered shall constitute valid notice under this Note and shall be deemed to
have been received (i) on the day of actual delivery in the case of personal
delivery, if delivered on a business day (otherwise on the next business day),
(ii) on the next business day after the date when sent in the case of delivery
by nationally-recognized overnight courier, (iii) on the fifth business day
after the date of deposit in the U.S. mail in the case of mailing or (iv) upon
receipt in the case of a facsimile transmission if received on a business day
(otherwise on the next business day). Any party hereto may from time to time by
notice in writing served upon the other as aforesaid designate a different
mailing address or a different Person to which all such notices, demands or
requests thereafter are to be addressed.

     

    8.           No Impairment. The
Borrower will not avoid or seek to avoid the observance or performance of any of
the terms of this Note, but will at all times in good faith assist in the
carrying out of all such terms and in the taking of all such action as may be
necessary or appropriate in order to protect the rights of the holder of this
Note against impairment.

     

    9.           Usury.
Notwithstanding anything herein to the contrary, this Note is subject to the
express condition that at no time shall the Borrower be obligated or required to
pay interest hereunder at a rate which could subject Holder to either civil or
criminal liability as a result of being in excess of the maximum contract rate
which is permitted by law. If, by the terms of this Note, the Borrower is at any
time required or obligated to pay interest at a rate in excess of the maximum
contract rate which is permitted by law, the rate of interest under this Note
shall be immediately reduced to the maximum contract rate which is permitted by
law and all interest payable hereunder shall be computed at the maximum contract
rate permitted by law, and the portion of all prior interest payments in excess
of the maximum contract rate permitted by law shall be applied to and shall be
deemed to have been payments made for the reduction of the outstanding principal
balance of this Note.

     

    10.         Waiver of Notice of
Presentment. All parties to this Note, whether principal, surety,
guarantor or endorser, hereby (i) waive presentment, demand for performance and
notice of protest, notice of dishonor and notice of acceleration of maturity,
(ii) waive any rights which they may have to require Holder to proceed against
any other person or property, (iii) agree that without notice to any party and
without affecting any party’s liability, Holder, at any time or times, may grant
extensions of the time for payment or other modification of this Note, and may
add or release any party primarily or secondarily liable, and (iv) agree that
Holder may apply all monies made available to it in connection with the payment
of this Note either to this Note or to any other obligation of any of the
parties to Holder, as Holder may elect from time to time.
 

    
      
         

      

      
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    11.         No Waiver;
Assignment. The failure of Holder to exercise any right or remedy
provided hereunder or available at law shall not be a waiver or release of such
rights or remedies or the right to exercise any right or remedy at another time.
Borrower may not negotiate, transfer or assign this Note without the prior
written consent of the Holder. This Note is binding upon, and will inure to the
benefit of, each holder, the maker, any sureties, endorsers or guarantors, and
their successors and permitted assigns.

     

    12.         Governing Law; Consent to
Jurisdiction. This Note shall be construed in accordance with the laws of
the State of New York without regard to the conflicts of laws provisions
thereof. Each of the parties hereto submits to the exclusive jurisdiction of any
state or federal court sitting in the Borough of Manhattan, County of New York,
in any action or proceeding arising out of or relating to this Note, agrees that
all claims in respect of the action or proceeding may be heard and determined in
any such court and agrees not to bring any action or proceeding arising out of
or relating to this Note in any other court. Each of the parties waives any
defense of inconvenient forum to the maintenance of any action or proceeding so
brought and waives any bond, surety or other security that might be required of
any other party with respect thereto. Any party may make service on any other
party hereto by sending or delivering a copy of the process to the party to be
served at the address and in the manner provided for the giving of notices in
Section 7 above. Nothing in this Section, however, shall affect the right of any
party to serve legal process in any other manner permitted by law. Each party
agrees that a final judgment in any action or proceeding so brought shall be
conclusive and may be enforced by suit on the judgment or in any other manner
provided by law.

     

    *  *  *  *  *
 

    
      
         

      

      
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      Exhibit
4.4

    

     

    IN WITNESS WHEREOF, this
Future Advance Promissory Note has been executed by the Borrower as of the day
and year first above written.

     

    
      
        
          	
                  VENTRUS
      BIOSCIENCES, INC.

                
	 
      	 
      
	
                  By: 

                	 
      
	 
      	
                  Name:
      Thomas Rowland

                
	 
      	
                  Title:
      President &
CEO

                

        

      

    
 

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
      Exhibit
4.4

SCHEDULE
A

    

    SCHEDULE
OF ADVANCES

      

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            
                                              
                                                
                                                  
                                                    
                                                      
                                                        
                                                          
                                                            
                                                              	
                                                                      Date of Advance

                                                                    	 	
                                                                      Advance Amount

                                                                    	 
	 
      	 	$	 	 
	 
      	 	$	 	 
	 
      	 	$	 	 
	 
      	 	$	 	 
	 
      	 	$	 	 
	 
      	 	$	 	 
	 
      	 	$	 	 
	 
      	 	$	 	 
	 
      	 	$	 	 
	 
      	 	$	 	 
	 
      	 	$	 	 

                                                            

                                                          

                                                        

                                                      

                                                    

                                                  

                                                

                                              

                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    
 

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    AMENDMENT
AGREEMENT

    (Related
Party Notes)

    

    December
21, 2009

     

    This
Amendment Agreement (this “Agreement”) is entered into by
and between Ventrus Biosciences, Inc., a Delaware corporation (the “Company”) and each of Capretti
Grandi, LLC and Paramount Biosciences, LLC (together with successors and assigns
of each, a “Holder,” and
collectively, the “Holders”) and amends the
Future Advance Promissory Notes issued to them on April 24, 2009 and July 23,
2008 respectively (collectively, the “Related Party Notes”) in the
aggregate principal amount of $2,573,201.

     

    RECITALS

     

    Whereas,
each of the Holders and the Company are party to the Related Party Notes;
and

     

    Whereas, each of the undersigned
Holders agrees to amend the Related Party Notes on the terms set forth
herein.

     

    AMENDMENT

     

    NOW,
THEREFORE, the parties agree as follows:

     

    1.        Amendments.   Section 3
of each of the Related Party Notes is hereby deleted and replaced in its
entirety by the following:

     

    3(a)           All
references to the “Company” shall mean the “Borrower”.  All unpaid
principal and accrued but unpaid interest on this Note shall be automatically
converted into the Company’s equity securities (the “Securities”) issued in the
Company’s next equity financing (or series of related equity financings),
including without limitation a firm commitment underwritten initial public
offering pursuant to an effective registration statement under the Securities
Act of 1933, as amended (such offering, a “Qualified IPO”) involving the sale of
Securities in which the Company receives in arm’s length non-related party
transaction(s) at least $8,853,976 (the “Threshold”) in aggregate gross cash
proceeds (before brokers’ fees or other transaction related expenses, and
excluding any such proceeds resulting from any conversion of the convertible
promissory notes existing as of the date hereof (the “Bridge Notes”)) (a
“Qualified Financing”), at a conversion price equal to 70% of the lowest per
unit price paid for such Securities in cash by investors in such Qualified
Financing, and, with the exception of a Qualified IPO, upon such other terms,
conditions and agreements as may be applicable in such Qualified
Financing.  Notwithstanding the foregoing, the Threshold shall be
automatically reduced, on a dollar-for-dollar basis, by the amount of aggregate
gross cash proceeds to the Company from the arm’s length non-related party sale
of equity or debt securities of the Company, or the incurrence of new loans at
arm’s length from non-related party or parties, in each case after December 21,
2009, but shall not in any event be reduced to less than
$5,000,000.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
      3(b)           In the
event that the Company consummates a merger, share exchange, or other
transaction (or series of related transactions), other than in connection with a
Qualified Financing, in which (i) the Company merges into or otherwise becomes a
wholly-owned subsidiary of a company that (A) is subject to the public company
reporting requirements of the Securities Exchange Act of 1934, as amended, or
the equivalent reporting requirements of the Ontario Securities Commission, or
that is listed on the London Stock Exchange main market, the Euronext markets,
or AIM (or their successor exchanges or markets), and (B) does not engage in any
active operations, and (ii) the aggregate consideration payable to the Company
or its stockholders in such transaction(s) (the “Reverse Merger Consideration”)
is greater than or equal to $10,000,000 (a “Reverse Merger”), then immediately
prior to such Reverse Merger, all unpaid principal and accrued but unpaid
interest on this Note shall be automatically converted into Common Stock at a
conversion price per share equal to 70% of the quotient obtained by dividing (i)
the Reverse Merger Consideration less the amount of unpaid principal and accrued
but unpaid interest on all Bridge Notes, on all other notes convertible into
equity securities of the Company issued after December 21, 2009 (the “New Bridge
Notes”), and the Related Party Notes immediately prior to the Reverse Merger by
(ii) the number of shares of Common Stock of the Company then outstanding, on a
fully diluted basis (the “Outstanding Shares”). For this purpose, Outstanding
Shares shall (i) exclude any shares of Common Stock issuable upon conversion of
the Notes, the New Bridge Notes or the Related Party Notes or upon exercise of
the warrants issued to the Placement Agent in connection with the sale of the
Notes or the New Bridge Notes but (ii) include all shares of Common Stock
issuable upon the exercise of (A) options and other warrants outstanding (to the
extent that such options or warrants are exercised or assumed in connection with
the Reverse Merger) and (B) options that the Company is required by agreement to
issue to one or more employees, consultants, or licensors of the Company in
connection with such Reverse Merger to maintain a specified percentage interest
in the Company (but which have not yet been issued)).

    

     

    
      3(c)           The price
per share at which the Notes will convert into Common Stock of the Company upon
a Sale of the Company will be equal to the lesser of (i) 70% of the quotient
obtained by dividing (x) the value of the Sale Proceeds received in such
transaction less the unpaid principal and accrued but unpaid interest on the
Notes, the New Bridge Notes and the Related Party Notes immediately prior to the
Sale of the Company by (y) the number of Outstanding Shares, and (ii) the
quotient obtained by dividing (x) $50,000,000 less the unpaid principal and
accrued but unpaid interest on the Notes, the New Bridge Notes and the Related
Party Notes by (y) the number of Outstanding Shares. For purposes of this
Section 2.1(c), Outstanding Shares shall be determined as set forth in Section
2.1(b) of this Note, except that it shall not include any shares of Common Stock
issuable upon the exercise of any options and warrants outstanding immediately
prior to such Sale of the Company if such options or warrants have an exercise
price in excess of the Note conversion price determined under this Section
3(c)).

    

     

    2.        Consent.  The undersigned
hereby consents to the amendments to the Related Party Notes as set forth in
Section 1 hereof.

     

    3.        Representations
and Warranties of the Holders.  Each of the
Holders party hereto hereby represents and warrants to the Company
that:

     

    (a)           the
Holder is the lawful holder of their Related Party Note free and clear of all
security interests, claims, liens, pledges, conditional sales contracts,
attachments, judgments and encumbrances of every kind and nature, including
restrictions, or rights of any third parties;

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (b)           the
Holder has the requisite power and authority to execute and deliver this
Agreement, to perform the Holder’s obligations hereunder and to engage in the
transactions contemplated hereby;

    

    (c)           the
Holder has taken all requisite action to make all the provisions of this
Agreement the valid and enforceable obligations they purport to be;
and

    

    (d)           this
Agreement constitutes the valid and binding obligation of the Holder,
enforceable in accordance with its terms, subject to laws of general application
from time to time in effect affecting creditors' rights and the exercise of
judicial discretion in accordance with general equitable
principles.

    

    4.        Miscellaneous

     

    (a)           This
Agreement may be executed in two or more counterparts, all of which when taken
together shall be considered one and the same agreement and shall become
effective when counterparts have been signed by each party and delivered to the
other party, it being understood that both parties need not sign the same
counterpart.  In the event that any signature is delivered by facsimile or
electronic transmission, such signature shall create a valid and binding
obligation of the party executing (or on whose behalf such signature is
executed) with the same force and effect as if such facsimile or electronic
signature page were an original thereof.

     

    (b)           This
Agreement shall be governed by the law of the State of New York without giving
effect to any principles or conflicts of law.

     

    (c)           Except
as expressly amended hereby, the terms of the Related Party Notes shall remain
in full force and effect.  Each party shall do and perform, or cause
to be done and performed, all such further acts and things, and shall execute
and deliver all such other agreements, certificates, instruments and documents,
as the other party may reasonably request in order to carry out the intent and
accomplish the purposes of this Agreement and the consummation of the
transactions contemplated hereby.

     

    (d)           Existing
references to any of the Related Party Notes are henceforth deemed references to
the Amended Related Party Notes.

     

    (e)           If
any provision or portion of this Agreement shall be determined to be invalid or
unenforceable for any reason, in whole or in part, the remaining provisions of
this Agreement shall be unaffected thereby and shall remain in full force and
effect to the fullest extent permitted by law.

     

    (f)           The
headings contained in this Agreement are for reference purposes only and shall
not be deemed to be part of the Agreement or to affect the meaning or
interpretation of this Agreement.

     

    (g)           All
of the terms and provisions of this Agreement shall bind and inure to the
benefit of the parties hereto and their respective successors and assigns. This
Agreement is intended for the benefit of the parties hereto and their respective
permitted successors and assigns, and is not for the benefit of, nor may any
provision hereof be enforced by, any other person or entity.

     

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

     

    Ventrus
Biosciences, Inc.

    

    
      
        
          	
                  By:

                	  
      
	 
      	
                  Thom
      Rowland, Acting
President

                

        

      

    

    

    Capretti
Grandi, LLC

    

    
      
        
          
            
              	
                      By:

                    	 
      
	 
      	 
      
	
                      Name:

                    	 
      
	 
      	 
      
	
                      Title:

                    	 
      

            

          

        

      

    

    

    Paramount
Biosciences, LLC

    

    
      
        
          
            
              	
                      By:

                    	 
      
	 
      	 
      
	
                      Name:

                    	 
      
	 
      	 
      
	
                      Title:

                    	 
      

            

          

        

      

    

     

    
      Amendment
Agreement Signature Page

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